Delhi District Court
Cc No. 459/2001 Parvinder Sadh vs Marshneil Garment Exports Page No. 1 Of ... on 28 November, 2013
IN THE COURT OF MS. NEHA PALIWAL
METROPOLITAN MAGISTRATE-03, KKD, EAST, NEW DELHI
Complaint No. 459/01/2011
Unique ID No. 02402R0338232011
PS. Geeta Colony
Shri Parvinder Sadh
S/o Sh. Kailash Nath Sadh,
X/3993, Street no.14, Shanti Mohalla, Gandhi Nagar,
Delhi-31 ......... Complainant.
Versus
1. Marshneil Garment Export ( P ) Ltd.
2. Sh. Ashok Yogi, Director
M/s Marshneil Garment Export ( P) Ltd.
Both of 114/1, Ramesh Park,
Laxmi Nagar, Delhi-92 ......... Accused.
COMPLAINT U/s 138 OF THE NEGOTIABLE INSTRUMENTS ACT
Offence complained of : U/s 138 N.I. Act
Plea of Accused person : Not guilty
Complaint filed on : 08.11.2011
Final Arguments heard &
Concluded on : 12.11.2013
Date of decision of the case : 28.11.2013
Final order : Acquittal
CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 1 of 14
BRIEF FACTS AND REASONS FOR DECISION OF THE CASE
1. The present case has been instituted on the complaint of the complainant Parvinder Sadh, U/s 138 Negotiable Instrument Act 1881 (as amended up to date) against the accused M/s Marshneil Garments Export Pvt. Ltd. and its Director Ashok Yogi.
2. As per the complaint, it is the case of the complainant that he is the Proprietor of M/s. Royal Fabrics and had business transactions with the accuseds. However, the accuseds purchased goods from him amounting to Rs. 10,02,118.75 ps. during the period 6.5.2009 to 26.7.2009 and issued four post dated cheques for the discharge of their liability i.e cheque bearing no. 480654 and 480655 both dated 5.8.11 for Rs. 2.50 lacs each and cheques bearing no. 480653 and 480657 both dated 6.8.11 for Rs. 2.00 lacs each. All drawn on ICICI Bank Ltd.
3. It is the case of the complainant that however, when he presented the said cheques for encashment time and again, they were returned unpaid, lastly on 15.9.11 with an endorsement "Funds Insufficient/Account blocked". Thereafter, the complainant got issued legal demand notice dated September 2011 by Speed Post and Courier on 1.10.2011 and 3.10.2011 respectively against the two cheques bearing no. 480654 and 480655 dated 05.8.11 each for Rs. 2.5 Lacs drawn on ICICI Bank Ltd. However, it is the case of the complainant that he received a false and frivolous reply of the same dated 15.10.2011 and the accused has not paid the cheque amount to the complainant despite the service of legal demand notice. It is the case of the complainant that there has been previous transactions between the parties and certain payments made by the accused pertaining to different and separate transactions.
4. It is the case of the complainant that as accuseds had not paid the amount the present complaint was filed by the complainant against both the accused. Thus it is prayed by the complainant that both the accused be tried and punished for the offence U/s 138 NI Act.
CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 2 of 14
5. In the present matter the complaint was filed before the court on 08.11.2011. The cognizance of the offence was taken on on 03.01.2012 and on the very same date the Ld. Predecessor of this court summoned the accused for the offence U/s 138 NI Act.
6. Thereafter, on 03.04.2012 accused no.2 appeared before the court on behalf of himself and accused no.1. He was admitted to court bail on the same day and on that day itself notice U/s 251 Cr.P.C. for the offence under section 138 NI Act was framed against both the accused to which they pleaded not guilty and claimed trial. It was submitted by the accused no.2 at the stage of framing of notice that he has only signed the cheque in question and had filled the amount therein. However, he had not issued the same to the complainant and nor he has filled the name of the payee or the date therein. It was the plea of accused no.2 that the cheques in question were lost and a complaint in this regard has already been filed by him. Accused no.2 also admitted receiving of the legal notice and stated that he has even replied to the same. It was submitted by him that he had no pecuniary liability towards the complainant and the cheques in question were misused by the complainant.
7. As it was submitted by Ld. Counsel for complainant that he has no objection if the opportunity is granted to the accused to cross examine the complainant, Ld. predecessor of this court put the matter straightaway for the purpose of cross examination of complainant and dispensed with the requirement of moving the application U/s 145(2) NI Act.
8. In order to prove his case, the complainant examined himself as CW-1 and tendered his evidence by way of affidavit Ex. CW-1/1 before the court and relied upon the documents exhibited as Ex. CW-1/A to Ex. CW-1/M which are as under:-
(a) Ex. CW-1/A Ledger Account from 1.4.2009 to 31.3.2010 of Marshneil Overseas kept by Royal Fabrics.
(b) Ex. CW-1/B (Colly) carbon copies of bills / cash/credit memo of Royal Fabrics in the name of Marshneil Overseas).
CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 3 of 14
(c) Ex. CW-1/C cheque bearing no. 480654 dated 5.8.2011 for Rs. 2.5 lacs drawn on ICICI Bank Ltd.
(d) Ex. CW-1/D cheque bearing no. 480655 dated 5.8.2011 for Rs. 2.5 lacs drawn on ICICI Bank Ltd.
(e) Ex. CW-1/E debit / credit advice dated 1.11.2011. ( f) Ex CW1/F copy of legal notice dated September 2011.
(g) Ex CW1/G to Ex CW1/N postal receipts, courier receipts, AD cards, returned envelopes vis-a-vis legal notice showing the date of dispatch to be 1.10.2011.
(h) Ex CW1/M reply to legal notice dated 15.10.2011.
9. In the present matter vide order dated 4.8.2012, of the Ld. Predecessor of this court cross examination was jointly recorded with connected case bearing no. 458/01/2011 as it was jointly submitted by the parties that the parties are the same and even cause of action is the same and the cheques pertain to the same transaction. The documents confronted to the complainant during the cross examination were placed by the accused in CC. No. 458/01/2011 and the accused undertook to place those documents in this matter as well at the stage of recording statement of accused. However, he had placed before the court only certified copy of Ex. CW-1/D-1 and Ex. CW-1/D-2 and has not placed Ex. CW-1/D-3 to Ex. CW-1/D-4. However, as those documents were in connected matter, they were read in present matter as well.
10. Thus, during cross examination the complainant was confronted with documents Ex CW1/D1 i.e complaint filed by the brother of the complainant namely Sh. Shalinder Sadh against the accused; Ex CW1/D2 ( Colly) certified copies of the copies of the bills filed in that complaint and the certified copies of the cheques; CW1/D3 copy of the complaint made to SHO PS Shakarpur bearing DD no. 46 A dated 22.5.10 ( OSR). CW1/D4 copy of another complaint made against the brother of the complainant to SHO PS Shakarpur ( OSR).
11. As besides complainant no other witness was examined, on the submission of the counsel for the complainant post summoning evidence was closed, vide order of the court dated 01.08.2013.
CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 4 of 14 Thereafter, the matter was fixed for statement of accused and statement of accused was recorded before the court on 11.09.2013, wherein the accused reiterated the same stand as taken by him at the stage of framing of notice and stated that he had not issued the cheques in question to the complainant as he had no dealing with the complainant. He also submitted that he has even replied to the legal notice of the complainant and has also put to the complainant the copy of the complaint made by his brother against him. Copy of bills and copy of complaint made to SHO PS Shakarpur against complainant and his brother ( Ex CW1/D1 to D3). It was, however, submitted by the accused no.2 on behalf of both the accused that he does not wish to lead defence evidence.
12. Thereafter the matter was fixed for final arguments.
13. I have heard the arguments as advanced by the Ld. counsels for the complainant and the accused and have gone through the material placed on record alongwith the evidence adduced by the parties before the court.
14. Before adverting to the case in hand it is necessary to discuss the law of the land as applicable to the present case in hand. The main ingredients of Section 138 of the Negotiable Instruments Act are as follows:-
(a) The accused issued a cheque on an account maintained by him with a bank.
(b) The said cheque has been issued in discharge of any legal debt or other liability.
(c) The cheque has been presented to the bank within the period of six months from the date of the issuance of the cheque or within the period of its validity.
(d) When the aforesaid cheque was presented for encashment, the same was returned unpaid/ dishonoured.
(e) The Payee of the cheque issued a legal notice of demand within 30 days from the receipt of information by him from the Bank CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 5 of 14 regarding the return of the cheque.
(f) The Drawer of the cheque failed to make the payment within 15 days of the receipt of the aforesaid legal notice of demand.
15. If the aforesaid ingredients are satisfied then the drawer of the cheque shall be deemed to have committed an offence punishable u/s 138 Negotiable Instruments Act.
16. In the present case in hand the complainant has proved before the court the existence of cheques Ex. CW-1/C and CW1/D. The accused has admitted his signatures upon the cheques in question and that he had filled the amount in figures as well as words therein. Thus it is established before the court that these cheques belonged to the accused and bear the signatures of the accused. However, the accused has denied that he had handed over these cheques to the complainant and that he has filled the date therein.
17. It is the case of the accused at the stage of notice that these cheques were lost and he has also filed a complaint in this respect. The accused has confronted the complainant in his cross examination with the document Ex. CW-1/D-3 which is a complaint made by the accused to SHO PS Shakarpur as per which it is the case of the accused that he had given some post dated cheques to the brother of the complainant and despite the fact that he had given the brother of the complainant cash payment the brother is not returning the cheques to him.
18. The accused has also confronted the complainant with complaint made by the brother of the complainant against the accused Ex. CW-1/D-1. The complainant has admitted that the complaint Ex. CW-1/D-1 has been filed by his brother alongwith bills Ex. CW-1/D-2 against the present accused.
19. In his cross examination it is admitted by the complainant that his brother is also having dealing with the accused though he denied the accused had only dealing with his brother and not with him.
20. It was further admitted by the complainant in his cross CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 6 of 14 examination that his brother is having only one employee. The complainant further admitted that bills Ex. CW-1/B (Colly) and Ex. CW-1/D-2 colly., are in the same handwriting.
21. Perusal of the documents and the testimony of the complainant shows that the bills Ex. CW-1/B (Colly.) which are relied upon by the complainant in order to prove the pecuniary liability of the accused towards him and the bills Ex. CW-1/D-2 are prepared by the same person. As per the own admission of the complainant there is only one employee in the firm of his brother. Reading it all together, shows before the court that the bills of the complainant also were prepared by the employee of his brother. Furthermore, the bills Ex. CW-1//B (Colly.) do not bear any receiving or endorsement of the accused upon them and the said fact is also admitted by the complainant in his cross examination.
22. Moreover, it is stated by the complainant that he prepare bills in triplicate and can produce the bill book before the court. However, no bill book has been shown before the court by the complainant.
23. Furthermore the complainant has repeatedly stated in his cross examination that he has shown the amount outstanding against the accused in his income tax return for the year 2009-2010 and 2010-2011. However, despite the fact that liberty was given to him to produce the said documents before the court the complainant had failed to produce the said income tax returns before the court.
24. In the present case in hand the complainant has not even filed before the court any cheque returning memo which can show before the court that the cheques were dishonoured with the remarks 'Funds insufficient/Account Blocked', on 15.9.2011. The complainant has only produced before the court the debit/credit advice Ex. CW-1/E dated 1.11.2011 which shows that the cheques were rejected for the reasons 'Account Blocked'. The complainant has stated in his cross examination that he can produced before the court, that the cheques were dishonoured due to the reasons 'Funds Insufficient/No Balance' in the month of August 2011 and CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 7 of 14 lastly on September 2011. However, despite undertaking before the court that he can produce the said documents the complainant has failed to produce the said documents before the court. In the absence of the cheque returning memos of August and September 2011, the basic ingredient of the offence U/s 138 NI Act that the legal notice has to be given to the accused within 30 days of the dishonour of the cheque remains unproved. As the debit and the credit advice is dated 1.11.2011, it does not throw any light on the dates when the cheque was actually dishonoured and by no stretch of imagination it corroborate the stand of the complainant that in August 2011 the cheques were dishonoured with the remarks "Funds Insufficient/No Balance'.
25. Section 118 and Section 139 of Negotiable Instruments Act raised number of presumptions with respect to the offence U/s 138 NI Act as soon as the execution of the cheque by accused is established before the court. Section 118 NI Act raises a number of presumptions of consideration, date, time of acceptance, time of transfer and status of holder in due course unless the contrary is proved. The section lays down special rule of evidence applicable to negotiable instruments and presumptions are one of law and the court shall presume that the negotiable instrument which is the cheque in the present case, was made for consideration, was made on the date which it bears and that it was handed over to the complainant by the accused in due course.
26. Section 139 of Negotiable Instruments Act raises presumption that the holder of the cheque which is the complainant in the present case received the cheque for the discharge in whole or in part of any debt or other liability.
27. However, these presumption U/s 118 and Section 139 NI Act are rebuttable in nature. Thus as soon as the execution of the cheque is established the burden is shifted to accused to prove otherwise. A presumption is not itself evidence, but only makes a prima facie case for a party for whose benefit it exists.
28. In the present case in hand the accused has admitted before the court that the cheque in question bears his signatures though CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 8 of 14 he has disputed the handing over of the cheque to the complainant. As per the Negotiable Instruments Act, there is no legal requirement that the body of the cheque would also be filled by the person who is signing the same and once the signatures are admitted by the drawer, the presumptions come into force. However, these presumptions are rebuttable in nature, but the onus to rebut the same is upon the accused.
29. Hon'ble Supreme Court of India in the case of Krishna Janardhan Bhatt Vs Dattatraya G. Hegde (2008) 2 Supreme Court Cases (Cri.) 166 has cautioned that the court must be on guard to see that merely on the application of presumption as contemplated U/s 139 of the NI Act, the same may not lead to injustice or mistaken conviction.
30. It was held by Hon'ble Apex Court in the said case that for proving the defence the accused is not required to step into the witness box and need not examine himself. He may discharge his burden on the basis of the material already brought on record as he a constitutional right to maintain silence. Standard of proof on the part of the accused and that of the prosecution in a criminal case is different. The prosecution must prove the guilt of accused beyond all reasonable doubts. However, the standard of proof, so as to prove a defence on the part of the accused is preponderance of probabilities whose inference can be drawn not only from the materials brought on record by the parties, but also by reference to the circumstances upon which he relies. It was held that where chances of false implication cannot be ruled out, the background fact and the conduct of the parties together with their legal requirements are required to be taken into consideration.
31. It has been held by the Hon'ble Apex Court in Catena of judgments that the standard of proof in discharge of the burden in terms of section 139 of the Act being preponderance of probabilities the inference therefore, can be drawn not only from the material brought on record but also from the reference to the circumstances upon which the accused relies upon. Furthermore it is not essential for the accused to get himself examined as witness and he can CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 9 of 14 discharge the burden of proof which has been shifted upon him due to the presumptions even by cross examination of the complainant's witnesses.
32. In the case of Kumar Exports VS Sharma Carpets 2009 II AD (SC) 117 it was held by the Hon'ble Apex Court that to rebut the statutory presumptions the accused may either adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist on every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence, because the existence of negative evidence at all times is neither possible nor contemplated. At the same time mere denial of passing of consideration and existence of debt also would not serve the purpose of accused, something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. It was further held that once the rebutal evidence is adduced and accepted by the court the evidential burden shifts back upon the complainant and thereafter, the presumptions U/s 118 and 139 of the Act will not again come to the complainant's rescue.
33. Thus it has been held by Hon'ble Apex Court that Section 139 of the Act is an example of reverse onus clause which has been included for improving the credibility of Negotiable Instruments. However, as the offence U/s 138 is a regulatory offence only, therefore, test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused cannot be expected to discharge an unduly high standard of proof.
34. In view of the above said decisions it can be safely said that the onus upon the accused is only to show a probable defence which is not high as that of beyond reasonable doubt and only the accused has to prove his defence to the extent of preponderance of probabilities in order to shift back the onus upon the complainant to prove his case before the court.
35. In the present case in hand the accused has been able to rebut the presumptions as raised U/s 118 and 139 of NI Act on the CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 10 of 14 following grounds.
36. Firstly, the bills Ex. CW-1/B do not bear any receiving or signature of the accused and the said fact is also admitted by the complainant. Despite opportunity complainant has failed to show before the court, the binded bill book and only carbon copies of the bills were produced before the court. Therefore, the bills were not proved by the complainant before the court. Ex. CW-1/A is the copy of the ledger account of the complainant's firm wherein the account of Marshneil Overseas is shown. It is the case of the complainant that Marshneil Overseas is also the firm/company of the accused and on the submissions of the accused, the bills were raised in the name of Marshneil Overseas. Even though the said contention is believed, the complainant has failed to produce before the court his income tax return which can show that the amount was due from Marshneil Overseas towards Royal Fabrics. Despite opportunity given by the court the said income tax return is not shown before the court.
37. Secondly in the present case in his cross examination it is admitted by the complainant that accused was having financial transactions with his brother as well. It is further admitted by the complainant that the bills Ex. CW-1/B (Colly.) are in the handwriting of employee of his brother. It is the case of the accused that he was having dealings only with the brother of the complainant. The accused is relying upon Ex. CW-1/D-1 to Ex. CW-1/D-4. These exhibits are the certified copy of the complaint filed by the brother of the complainant against the accused. The certified copies of the bills and cheques filed in that complaint and the complaint made by the complainant to SHO, PS Shakarpur. Though it is the stand of the accused at the stage of notice that the cheques in question were lost. However, perusal of complaint Ex. CW-1/D-3 shows the stand of the accused that the complaint which was lodged by the accused and which is also getting mention in his reply at the stage of notice that accused has given certain post dated cheques to the brother of the complainant and despite the fact that he was giving cash in return the brother of the complainant had refused to hand over the CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 11 of 14 cheques to him. The complaint Ex. CW-1/D-3 is also mentioning the name of the present complainant as it is admitted by the present complainant in his cross examination that he is also known by the name Tinku. Perusal of the complaint coupled with the testimony of the complainant regarding the fact that the bills were prepared by the employee of his brother and that there is a stand of the accused that he has not handed over any cheque to the complainant and has handed over a blank signed cheques to the brother of the complainant, reverse the onus upon the complainant. This onus is further discharged by the accused considering the admission of the complainant in his cross examination that the amount as well as figures and signatures in the body of the cheque are in different handwriting and the words 'Royal Fabrics' i.e. The name of the payee and the date on the cheques in question is in different writing and ink. The difference in handwriting perse does not shift the onus or discharge the burden, however if coupled with other factors and circumstances it creates a platform for rebuttal of presumptions.
38. Considering all these grounds in totality, the accused has succeeded to prove a probable defence in his favour. Though he has not examined himself in defence, however, he has constitutional right to remain silent.
39. The accused has only to create a doubt in the version of the complainant which in view of the above discussion, the accused has succeeded in doing. Moreso, the complainant has also failed to establish before the court that the legal notice was given within the period of 30 days after the dishonour of the cheque as no cheque returning memo of August or September has been shown before the court.
40. Furthermore, in the present case in hand the name of the payee is M/s Royal Fabrics. The complainant has filed the present complaint before the court in the capacity of the proprietor of M/s Royal Fabrics. However, the complainant has not produced any document before the court in order to establish/prove before the court that he is the proprietor of M/s Royal Fabrics. Though, reply CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 12 of 14 by the accused to the legal notice of the complainant is on record Ex. CW-1/M and the said reply is not denying the factum of proprietorship categorically as it is stating the same to be a matter of record. However, perusal of the said reply shows that it has been replied viz a viz Shailender Sadh who is brother of the complainant and not viz a viz the complainant.
41. It was held by the Hon'ble Division Bench of Hon'ble Supreme Court ind the case of Milind Sripad Chandurkar v. Kalim M. Khan & Anr (JT2011(3)SC138) that:
"A person can maintain a complaint provided he is either a "payee" or "holder in due course" of the cheque.
In the instant case, the firm, namely, Vijaya Automobiles, has been the payee and that the appellant cannot claim to be the payee of the cheque, nor can he be the holder in due course, unless he establishes that the cheques had been issued to him or in his favour or that he is the sole proprietor of the concern and being so, he could also be payee himself and thus, entitled to make the complaint. The appellant miserably failed to prove any nexus or connection by adducing any evidence, whatsoever, worth the name with the said firm, namely, Vijaya Automobiles. Mere statement in the affidavit in this regard, is not sufficient to meet the requirement of law. The appellant failed to produce any documentary evidence to connect himself with the said firm. The appellant failed to adduce any evidence in this regard, nor made any attempt to adduce any additional evidence at the appellate stage, in spite of the fact that the respondent is raising this issue from the CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 13 of 14 initiation of the proceedings.
42. Thus in the present case the complainant has also failed to prove before the court beside other things that he is the holder of the cheque in due course or the payee of the cheque as he has failed to prove before the court the nexus between himself and the proprietorship firm and mere averment by way of affidavit is not sufficient.
43. Thus in view of the above said findings and discussions, firstly the ingredients of section 138 NI Act are not fulfilled as it is not proved before the court that the legal notice was issued within 30 days of dishonour of cheque. Secondly, the complainant has also failed to prove before the court that he is the holder of the cheque in due course and thirdly the accused has been able to rebut the presumptions as laid U/s 118 and 139 of NI Act and the onus has shifted upon the complainant to prove the guilt of the accused beyond the shadow of all reasonable doubts. However, the complainant after the onus has shifted upon him has failed to prove the guilt of the accused beyond the shadow of all reasonable doubts.
44. In view of the above said discussions and findings both the accused are acquitted for the offence U/s 138 NI Act.
45. For the purpose of section 437 A Cr.P.C, the previous personal bond and surety bonds of the accused no.2 stands extended for the period of next six months.
46. Let file be consigned to record room.
Announced in the open court
today i.e. 28.11.2013 (NEHA PALIWAL)
MM:East/KKD:DELHI
It is certified that the judgment contains 14 pages and all pages bear my signatures.
(NEHA PALIWAL) MM:KKD:DELHI:28.11.2013 CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 14 of 14 CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 15 of 14 CC No. 459/2001 Parvinder Sadh Vs Marshneil Garment Exports page no. 16 of 14