Delhi District Court
Bajrang Mittal vs . on 7 December, 2012
IN THE COURT OF MANISH KHURANA
METROPOLITAN MAGISTRATE
OUTER DISTRICT:ROHINI COURTS: DELHI
BAJRANG MITTAL
VS.
UDAY SHANKAR TIWARI
CC No.: 16/1
PS: Prashant Vihar
u/s 138 N I Act
1. Date of the commission of the offence: 08.12.2010
2. Name of the complainant: Bajrang Mittal
3. Name of the accused and address: Uday Shankar Tiwari
S/o Sh. Bodh Ram
Tiwari,
R/o H. No. D52,
Mangey Ram Park,
Rohini, Delhi.
Presently at M77,
Krishna Vihar,
Delhi86.
4. Offence complained of: u/s 138 Negotiable
Instruments Act
5. Plea of accused: Pleaded not guilty.
6. Final order: Convicted
7. Date of such order: 07.12.2012
Bajrang Mittal Vs. Uday Shankar Tiwari page 1
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8. Unique ID Number : 02404R0002292011
Date of Institution of case: 12.01.2011
Date of decision of the case: 07.12.2012
JUDGMENT
BRIEF FACTS AND REASONS FOR DECISION OF THE CASE
1. By way of the present Judgment, I shall decide the complaint case u/s 138 Negotiable Instruments Act,1881 (hereinafter referred to as N I Act) (as amended upto date) filed by the complainant Bajrang Mittal against accused Uday Shankar Tiwari.
2. The facts in brief necessary for the disposal of the present case are that as per the allegations in the complaint, the complainant wounded up his business of manufacturing of lead pencils, erasers and sharpeners under the trademark of NAGRAJ in the year 2007 and the accused who was working with M/s Ramaria Associates Pvt. Ltd. and was personally known to the complainant for last 45 years approached the complainant on 07.02.2008 and showed his intention to start his business in the said field by purchasing the above said machinery, pencil, eraser and its packaging material along with NAGRAJ trademark of the complainant on credit basis. It is further alleged that both the parties in the presence of Sh. T R Mittal, i.e. the father of the complainant entered into an agreement to sell the above said material for the consideration of Rs. 7 Lacs Bajrang Mittal Vs. Uday Shankar Tiwari page 2 of 17 on credit with the agreed term of payment that the accused would make the payment of the said amount by 31.03.2008 and the accused took the delivery of the entire material and machinery against a receipt dt. 07.02.2008 (Ex.CW1/1) from the complainant. However, the accused failed to make the payment of the said amount by the agreed date and the complainant approached him but the accused sought further time till 31.07.2004 and thereafter uptil 30.09.2008 and a written agreement dt. 22.05.2008 (Ex.CW1/2) was also executed between the parties. The accused again failed to make the payment of the said amount by 30.09.2008 and he approached the complainant with request of seeking some more time to make the payment and the aforesaid request was accepted by the complainant on the condition that the interest at the rate of 18% per annum shall be paid by the accused. Later on, the matter was settled on 10.08.2010 by making payment of Rs. 9,99,250 (Rs. 7 Lacs as Principle amount and Rs. 2,99.250 as interest thereupon) and the payment was made by the accused vide cheque bearing number 124604 dated 10.08.2010 drawn on Indian Overseas Bank, Prashant Vihar, Delhi amounting to Rs. 9,99,250 in favor of the complainant (cheque is Ex.CW1/3). However, on presentation of the same, it was dishonored vide cheque returning memo dated 10.08.2010 (Ex.CW1/4) with remarks "Funds Insufficient". Thereupon the complainant contacted the accused who felt sorry and requested him to present the said cheque again Bajrang Mittal Vs. Uday Shankar Tiwari page 3 of 17 in the last week of October, 2010 but the said cheque when again presented for payment got dishonored vide cheque returning memo dt. 30.10.2010 (Ex.CW1/5). The complainant thereafter sent a legal notice of demand dated 19.11.2010 (Ex.CW1/6) through his counsel through Registered AD and UPC (Ex.CW1/7 to Ex.CW1/9) which was posted on 23.11.2010 thereby calling upon the accused to make the payment of the cheque amount. It is alleged that accused has failed to pay the cheque amount despite service of legal notice within the stipulated period of time. As a result of which, the complainant has filed the instant complaint for prosecution of accused u/s 138 N I Act.
3. After the complaint was failed, the complainant lead pre summoning evidence by way of affidavit and the summons were issued to the accused vide order dated 12.01.2011 for the offence u/s 138 N I Act by this court. On appearance of the accused, a separate notice u/s 251 Cr.P.C. dated 01.08.2012 was given to the accused to which he pleaded not guilty and claimed trial.
4. In order to prove the case, the complainant got himself examined as CW1 and reiterated the contents of complainant on oath before the court. He got exhibited the original cheque in question before the court as Ex.CW1/3, the cheque returning memo dated 10.08.2010 as Ex.CW1/4 and memo dt. 30.10.2010 as Ex.CW1/5, the legal notice of demand dated 19.11.2010 as Ex.CW1/6 and registered post receipt and UPC postal receipts vide which the Bajrang Mittal Vs. Uday Shankar Tiwari page 4 of 17 aforesaid notice was sent as Ex.CW1/7 to Ex.CW1/9 respectively. The complainant was crossexamined by Ld. Counsel for the accused. Thereafter, the complainant's evidence was closed at request.
5. After that, the statement of accused was recorded u/s 313 Cr.P.C. in which all the incriminating evidence along with exhibited documents were put to the accused Uday Shankar Tiwari in which he stated that he had been falsely implicated in the case and he denied the agreement or the transaction between the parties. He also stated that he did not issue the cheque in question towards the payment of any machinery and the complainant was having his blank cheque which was used by the complainant. He denied that he ever received the legal notice of demand. He also denied his liability towards the complainant and stated that he was the employee in the firm of the father of the complainant and he left the job in the year 2008 and the father of the complainant used to open the bank account of all the employees and he used to get the blank cheque signed from all his employees before giving the employment. He also stated that he signed the cheque in question to get the employment but he was not liable to pay the cheque amount. Thereafter, the case was fixed for defence evidence. Ld. Counsel for accused moved an application u/s 315 Cr.P.C. for examination of the accused as a defence witness which was allowed and the accused examined himself as DW1 who was duly Bajrang Mittal Vs. Uday Shankar Tiwari page 5 of 17 cross examined by Ld. counsel for complainant. Thereafter, the defence evidence was closed and the case was fixed for final arguments.
6. I have heard Ld. Counsel for both the parties and also perused the record of the case file. In order to bring home the conviction of the accused, the complainant has to show not only unbroken chain of events leading to commission of actual offence on record but also the ingredients of the offence complained of.
7. Before proceeding further, let us go through the relevant provisions of law. The main ingredient of Section 138 of N I 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 cheque or within the period of its validity.
(d) When the aforesaid cheque was presented for encashment, the same was returned unpaid/dishonored.
(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 regarding the return of the cheque. Bajrang Mittal Vs. Uday Shankar Tiwari page 6 of 17
(f) The Drawer of the cheque failed to make the payment within 15 days of the receipt of the aforesaid legal notice of demand.
If the aforesaid ingredients are satisfied then the drawer of the cheque shall be deemed to have committed an offence punishable u/s 138 N I Act.
8. Now, let us deal with the each ingredient of the Section 138 of N I Act to see whether the case against the accused has been proved or not.
9. WHETHER THE CHEQUE WAS ISSUED OR NOT The accused has himself admitted to have signed the cheque in question while answering to the question at the time of framing of notice u/s 251 Cr.P.C. as well as during his statement u/s 313 Cr.P.C. Further the cheque in question is a bearer cheque having admitted signatures of the accused. Therefore, so far as signing or issuance of the cheque in question of the accused is concerned, the same is not disputed. In view of the evidence on record, it stands proved that the cheque in question was issued by the accused.
10. WHETHER THE CHEQUE WAS PRESENTED WITHIN THE PERIOD OF ITS VALIDITY Perusal of the record reveals that the cheque in question Ex.CW1/3 dated 10.08.2010 got dishonored on 10.08.2010 and on 30.10.2010 Bajrang Mittal Vs. Uday Shankar Tiwari page 7 of 17 vide cheque returning memos Ex.CW1/4 and Ex.CW1/5 for the "Funds Insufficient". It is not disputed by the accused during the cross examination of the complainant and it clearly shows that the cheque in question was presented within the period of its validity i.e. within six months from the date of issuance of the cheques.
11. DISHONOUR OF THE CHEQUE IN QUESTION In this case, the complainant has exhibited the cheque returning memos Ex.CW1/4 and Ex.CW1/5 vide which the cheque in question got dishonored. The dishonor of the cheque in question is also not disputed by the accused nor the cheque returning memo have been challenged by the accused. Therefore, it stands proved that the cheque in question got dishonored vide cheque returning memos dated 10.08.2010 and 30.10.2010 for the reason "Funds Insufficient".
12. SERVICE OF LEGAL NOTICE OF DEMAND UPON THE ACCUSED In the instant case, the complainant has stated in his evidence by way of affidavit that after dishonor of the cheque in question, a demand notice dated 19.11.2010 which is Ex.CW1/6 was sent through his counsel vide registered post and UPC postal receipts which are exhibited as Ex.CW1/7 to Ex.CW1/9 respectively. However, the accused denied the receipt of legal notice of demand at the time of his statement u/s 313 Cr.P.C.
Bajrang Mittal Vs. Uday Shankar Tiwari page 8 of 17 There is a presumption of Section 27 of General Clauses Act in favour of the complainant that properly addressed documents sent by the registered post is deemed to have been delivered if not returned back.
13.I have perused the legal notice of demand, it bears the correct address of the accused. However, the accused has raised the plea that in the year 2008, he had already shifted his residence, therefore, he did not receive the legal notice of demand.
14. In the case in hand, the notice was sent at the correct address of the accused which the accused left without intimation to the complainant. The complainant is not supposed to know the new address of the accused without being told or intimated by the accused. The accused cannot take the benefit of his own act and he cannot avoid his liability by simply saying that he has shifted his address, therefore, he did not receive the legal notice of demand and hence the case of the complainant cannot be proved. Ld. Counsel for the accused has also filed the Judgment titled as Amzad Pasha Vs. H N Lakshmana 2011 Crl.J. 552 Karnataka High Court in support of his contentions.
15. I have perused the aforesaid Judgment filed by Ld. Counsel for accused. In that Judgment, the Karnataka High Court has observed that when the legal notice of demand is not properly addressed then there cannot be a deemed service of notice. The Bajrang Mittal Vs. Uday Shankar Tiwari page 9 of 17 court has not stated that the properly addressed legal notice of demand is not presumed to be served in view of Section 27 of General Clauses Act.
16. Ld. Counsel for complainant has also relied upon Judgment titled as Subrata Kumar Dash Vs. Pradeep Kumar Sen 2000 Crl. J. 3614 Orissa High Court in which it was clearly held that when the legal notice was sent to the drawer of the cheque which was returned unserved and the facts and circumstances shows that the accused left the place of his residence to avoid receipt of notice, he is not entitled to take the stand that the statutory notice has not been served upon him.
17. Further the cross examination of the accused who examined himself as DW1 reveals that he admitted that he was residing at D52, Mangey Ram Park, Delhi and he never informed about the change of his address to the complainant.
18.Further in C.C. Alavi Haji Vs. Palapetty Muhammed and Anr. JT 2007 (7) SC 498, Crl. Appeal No. 767 of 2007, three Judge Bench of Hon'ble Supreme Court of India observed that any drawer who claims that he did not receive the notice sent by post, can, within 15 days of the receipt of summons from the court in respect of the complaint u/s 138 N I Act, make payment of the cheque amount and submit to the court that he had made payment within 15 days of receipt of summons and, therefore, the complaint Bajrang Mittal Vs. Uday Shankar Tiwari page 10 of 17 is liable to be rejected. A person who does not pay within 15 days of receipt of summons from the court cannot obviously contend that there was no proper service of notice as required u/s 138 N I Act, by ignoring statutory presumption to the contrary u/s 27 of General Clauses Act and Section 114 of Evidence Act. The court further observed that "in our view any other interpretation to the proviso would defeat the very object of the legislation". (para 17) The court while relying upon the Bhaskarans Case has also observed that if the giving of notice in the context of Clause b of the proviso of Section 138 N I Act was the same as the receipt of notice, a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of Section 138 of N I Act. (para 17)
19.Considering the evidence on record and the fact that the statutory notice was properly addressed at the address where the accused was admittedly residing at the time of issuance of cheques, the accused is not entitled to take the stand that he did not receive the legal notice of demand. Hence, I am of the considered opinion that the legal notice of demand was duly served upon the correct address of the accused.
20. WHETHER THE CHEQUE IN QUESTION WAS ISSUED IN DISCHARGE OF ANY LEGAL DEBT OR OTHER LIABILITY Bajrang Mittal Vs. Uday Shankar Tiwari page 11 of 17 In the case in hand, Bajrang Mittal, who is the complainant has got himself examined as Ex.CW1 and has stated in his evidence that the accused purchased the machinery etc. on credit basis and he also produced and exhibited the acknowledgment receipt dt. 07.02.2008 and the agreement dt. 22.05.2008 as Ex.CW1/1 and Ex.CW1/2 in support of his contentions. Perusal of the aforesaid acknowledgment receipt Ex.CW1/1 and agreement Ex.CW1/2 clearly reveals the commercial transaction between the parties and the admission of liability by the accused. Further the aforesaid acknowledgment receipt and agreement is duly signed by the accused Uday Shankar Tiwari.
21. However, during the cross examination of the complainant, Ld. Counsel for the accused gave the suggestions that the document Ex.CW1/1 was taken by the complainant after getting the same signed from the accused and Ex.CW1/2 was forged. Perusal of the cross examination of the complainant also reveals that the accused has not disputed his signatures over both of the above said documents and Ld. Defence counsel has given the suggestion that the complainant misused one blank paper duly signed by the accused and forged the agreement Ex.CW1/2 and due to that reason, the first page of the agreement did not bear the signatures of accused. The signing of the acknowledgment receipt dt. 07.02.2008 Ex.CW1/1 and the agreement dt. 22.05.2008 Ex.CW1/2 by the accused is not disputed. Further the signatures Bajrang Mittal Vs. Uday Shankar Tiwari page 12 of 17 over the cheque in question are also not disputed and the accused has admitted his signatures over the cheque in question. However, Ld. defence counsel has raised the arguments that the remaining particulars over the cheque in question were not filled in by the accused, therefore, the same cannot be said to have been issued for consideration.
22. The accused has taken the plea that the cheque in question was obtained by the father of the accused at the time of his employment in his company. However, during his crossexamination as DW1, the accused has admitted that he had not got the cheque book issued from the bank at the time of starting his job with M/s Ramariya Associates Pvt. Ltd. The accused has failed to explain as to how the cheque in question was delivered by him at the time of joining his job in Ramariya Associates when he had not received the cheque book from his bank. So far as alleged delivery of blank signed cheque by the accused is concerned, let us go through the relevant provisions of law:
Section 46 of the Negotiable Instruments Act speaks of the delivery, it reads as follows: "The making, acceptance or endorsement of a promisory notice, bill of exchange or cheque is completed by delivery, actual or constructive."
Section 118(b) of the Negotiable Instruments Act provides that Bajrang Mittal Vs. Uday Shankar Tiwari page 13 of 17 until the contrary is proved, the following presumption shall be made.
(b) As to date - that every Negotiable Instrument bearing a date was made or drawn on such date.
23. Moreover, there is a presumption in favour of the complainant u/s 118 (a) of Negotiable Instruments Act that until the contrary is proved, it will be presumed that every negotiable instrument was drawn for consideration and every such instrument when it has been accepted, endorsed, negotiated or transferred was accepted, endorsed, negotiated or transferred for consideration. Further Section 139 of the Negotiable Instruments Act, 1881 provides that it shall be presumed until the contrary is proved that the holder of the cheque received the cheque of the nature referred in the Section 138 of Negotiable Instruments Act for the discharged in whole or in part of his debt or liability.
24. Moreover, in Jaipal Singh Rana Vs. Swaraj Pal 149 (2008) DLT 682, it was held by Delhi High Court that "by putting the amount and the name, there is no material alteration on the cheque u/s 87 of Negotiable Instruments Act. In fact, there is no alteration but only adding the amount and the date.
25. It was further observed in the aforesaid Judgment that there is no rule of banking business that the name of the payee as well as the Bajrang Mittal Vs. Uday Shankar Tiwari page 14 of 17 amount should be written by the drawer himself. No law provides that in case of cheques, the entire body has to be written by the drawer only."
26. As far as the plea of the accused that Ex.CW1/2 was a security cheque which was misused by the complainant, I would place reliance upon the Judgment of Hon'ble Delhi High Court titled as I.C.D.S. Ltd. Vs. Beena Shabeer and Anr., MANU/SC/0669/2002 wherein it is been held:
A. The language, however, has been rather specific as regards the intent of the legislature. The commencement of the Section stands with the words "Where any cheque". The above noted three words are of extreme significance, in particular, by reason of the user of the word "any" the first three words suggest that in fact for whatever reason if a cheque is drawn on an account maintained by him with a banker in favour of another person for the discharge of any debt or other liability, commencement of Section 138, leave no manner of doubt that for whatever reason it may be, the liability under this provision cannot be avoided in the event the same stands returned by the banker unpaid. The legislature has been careful enough to record not only discharge in whole or in part of any debt but the same includes other liability as well. B. The language of the Statute depicts the intent of the lawmakers to the effect that wherever there is a default on the part of one in Bajrang Mittal Vs. Uday Shankar Tiwari page 15 of 17 favour of another and in the event a cheque is issued in discharge of any debt or other liability there cannot be any restriction or embargo in the matter of application of the provisions of Sectoin 138 of the Act: 'Any cheque' and 'other liability' are the two key expressions which stands as clarifying the legislative intent so as to bring the factual context within the ambit of the provisions of the Statute. Any contra interpretation would defeat the intent of the legislature.
27. Further, the Hon'ble High court of Delhi in Constellation Enterprises Pvt. Ltd. & Anr. Vs. PEC Limited 2006 (2) RCR (Criminal) 372:"2006 AD (Delhi) 582:2006, held as under: Even if a post dated cheque is give as security and the payment is not made as promised, then the said post dated cheque itself becomes payable because that is the agreement and understanding between the parties otherwise the security would have no meaning.
28.In the case in hand, the transaction between the parties is proved by way of documents Ex.CW1/1 and Ex.CW1/2 and the signing and delivery of cheque has also been admitted. In view of the aforesaid discussion, I am of the considered opinion that the accused has failed to rebut the presumption u/s 118(a) & (b) and Section 139 of N I Act. Therefore, it stands proved that the cheque in question which is Ex.CW1/3 was issued by the accused in discharge of his legal liability and for consideration.
Bajrang Mittal Vs. Uday Shankar Tiwari page 16 of 17
29. The drawer of cheque has failed to make the payment within 15 days of the receipt of legal notice of demand. In the instant case, CW1 Bajrang Mittal, the complainant has stated in his evidence that despite service of legal notice of demand, the accused has failed to pay the cheque amount and he stood well during his crossexamination so far as nonpayment of cheque amount by the accused is concerned. Further the accused has nowhere alleged that he has made the payment of the cheque amount to the complainant. During his statement u/s 313 Cr.P.C. also, the accused has admitted that he had not made the payment of the cheque amount.
30.Considering the entire evidence on record, it stands duly proved that the accused has failed to make the payment of cheque amount within 15 days of receipt of legal notice of demand.
31. In view of the aforesaid discussion, I am of the considered opinion that the complainant has proved his case against the accused beyond reasonable doubts. All the ingredients of Section 138 of N I Act have been duly proved on record. Accordingly, accused Uday Shankar Tiwari stands convicted for the offence u/s 138 N I Act. Let the copy of the Judgment be supplied to the accused.
Announced in the open court
today i.e. on 07.12.2012 (MANISH KHURANA)
METROPOLITAN MAGISTRATE
OUTER06: ROHINI COURTS: DELHI
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