Delhi District Court
Ms. Kaushalaya Devi vs . Ms. Rachna Sharma on 4 April, 2013
Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma
IN THE COURT OF MS. DEEPIKA SINGH, METROPOLITIAN
MAGISTRATE-03, CENTRAL, DELHI
CC No. 1856/11
Ms. Kaushalaya Devi
W/o Late Shri Jassi Ram
R/o N-460, Chandershekhar Azad Colony
Kishan Ganj, Delhi-7.
....................Complainant
vs.
Ms. Rachna Sharma
D/o Shri Narender Sharma
R/o B-18, Swamy Dayanand Colony,
Amba Bagh, Near Police Control Room,
Sarai Rohilla, Delhi-7.
............................Accused
The offence complained of : u/s 138 NI Act
The plea of the accused persons : not guilty
Final order : Convicted
Date of institution of complaint : 14.02.2002
Date on which reserved for judgment : 18.03.2013
Date of pronouncement of judgment : 04.04.2013
JUDGMENT:
1. Vide this judgment this court shall dispose of the present complaint u/s Page 1 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma 138 Negotiable Instruments Act, 1881 filed by the complainant against the accused.
2. Brief facts stated in the complaint are that the accused being a friend of complainant issued a cheque bearing no.252467 dated 03.01.2002 for Rs. 1,00,000/- in favour of the complainant drawn on Punjab National Bank, Kishan Ganj Branch, Delhi in discharge of his legal liability. The cheque is Ex. CW-1/A. The complainant presented the said cheques with his banker but the aforesaid cheque was returned back with memorandum dated 11.01.2002 of the bank with the remarks "Account closed". The cheque returning memo is Ex. CW-1/B. Thereafter, complainant sent a legal notice dt.23.01.2002 through his counsel by Regd. AD/UPC. The legal demand notice is Ex. CW-1/D and postal receipt is Ex. CW1-E. On failure of the accused to make the payment within the stipulated period, the present complaint was filed.
3. After hearing the arguments on summoning, sufficient grounds were made out against the accused u/s 138 NI Act and process was issued against her.. On her appearance, the accused was admitted to bail on 01.05.2004.
4. Notice U/s 251 Cr.P.C was served upon the accused on dt.17.03.2005 to which the accused pleaded not guilty and claimed the trial. Page 2 of 18
Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma
5. Complainant examined two witnesses in her evidence. She examined herself as CW-1 and she adopted her pre summoning affidavit as the post summoning affidavit, which is Ex .C1 wherein she reiterated the same facts.
During the cross examination of the complainant, she deposed that she knew the accused as she was classmate of her daughter Kusum. She does not know what was written in Ex. C-1 dated 10.09.2009 as well as Ex. CW1/D and what was filled up Ex. CW1/C. The cheque Ex. CW 1/A was filled up by her daughter Ms. Kusum. The averments made in her complaint that the amount was given as loan to the accused is wrong and the amount was given for the purpose of arranging some employment of her daughter. She told to her Advocate that the sum of Rs. 2,50,000/- was given to the accused on account of arranging some employment for her daughter. She does not remember through whom she sent the legal notice dated 23.01.2002 as well as she does not remember whether she met with advocate Sh Sanjeev Kumar, through whom she sent the legal notice to the accused. Complainant further deposed that it is correct that neither she met nor seen Advocate Sanjeev Kumar. The averments regarding the loan mentioned in the legal notice Ex. CW 1/D is wrong. It is correct that she had not signed Ex. CW1/D. She arranged the amount in question from one Mr. Satbir Bhardwaj. It is correct that her daughter Pushpa was working with Satbir Bhardwaj. She had given the amount in question for arranging the employment of her two daughter and one son. She Page 3 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma does not know in what the denomination of the amount in question was given to the accused. Complainant denied the suggestion that the cheque Ex. CW1/A had been given to her by Satbir Bhardwaj. She denied the suggestion that Ex. CW1/A and other document were forged and fabricated by her in connivance and collusion with Satbir Bhardwaj. Complainant further denied that there is no legally enforceable debt and liability against the accused.
6. The complainant examined Sh. J. K. Paul, Teller/Clerk, Punjab National Bank, Branch Kishan Ganj, Delhi as CW2 who had brought the summoned record of Saving Bank Account of Smt. Rachna Sharma bearing no. 28576. He deposed that one cheque Ex. CW-1/A was received in their bank for encashment through clearing from SBI on 11.01.2002 and the cheque was returned unpaid with the reason no. 8 as account closed in the aforesaid account number. Further, he placed on record copy of the cheque return book and statement of account, same are Ex. CW-2/A and Ex. CW-2/B respectively.
7. All the incriminating evidence had been put to the accused in her statement u/s 313 Cr.P.C, and she has replied that she never obtained any loan from the complainant. She stated that she obtained a loan of Rs. 1 Lac from one Mr. Satbir Page 4 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma Bhardwaj, who was introduced to her by Ms. Pushpa, daughter of the complainant. She further stated that the loan of Rs. 1 Lac had already been repaid along with interest of Rs. 30,000/-. The cheque in question was given as blank signed cheque under threat and two other blank papers also got signed from her forcibly. She denied of having received the legal demand notice. She never obtained any amount whatsoever from the complainant for any purpose not even for arranging a job for the children of the complainant. Her father lodged a complaint also in the concerned PS regarding the incident in question.
8. Accused examined herself as DW-1. In her examination in chief and in support of her defence, DW-1 relied upon some documents which are exhibited as Ex. DW1/1 i.e. statement of Kamal Kishore in case S/v Surender Grover Etc. dated 12.05.2011; DW-1/2 is the legal notice dated 23.01.2002; Ex. DW1/3 is the complaint dated 12.07.2001 to SHO Sarai Rohilla and Ex. CW 1/4 is the statement of Narender Kumar in case titled as Narender Kumar vs. Rachna Sharma dated 22.12.2009. She deposed that she had not taken any loan from the complainant Kaushalya Devi. She obtained a loan of Rs. 1 Lac from one Sh Satbir Bhardwaj, who was introduced to her by Ms. Pushpa, daughter of the complainant. The loan of Rs. 1 Lac had already been paid by her to Mr. Satbir Bhardwaj along with interest of Rs. 30,000/- upon the loan amount. Page 5 of 18
Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma The cheque in question along with other cheque were obtained from her by coercion and threat when Mr. Satbir Bhardwaj came along with Ms. Pushpa and two other person to her house. In this regard, her father made a complaint to the police. The cheque was given by her under threat as blank signed cheque and also she had given two blank papers and got signed obtained by Sh. Satbir Bhardwaj under threat and forcefully. She had never obtained any amount whatsoever from the complainant for any purpose not even arranging a job for children of complainant. She had not received any legal notice from the complainant.
In her cross examination, she deposed that she knew the complainant because her daughter studied with her. She used to visit the house of the complainant being friend to her daughter. The cheque in question only contains her signatures and none of its contents are in her hand writing. She had not received any legal notice dated 23.01.2002. She repaid the loan account by taking the loan from the Jain Co-operative Bank and paid a sum of Rs.1,30,000/- to Sh. Satbir Bhardwaj.
9. I have gone through the evidence, written submissions and heard the final arguments advanced by both the parties at length.
10. The case laws material for the present facts and circumstances are discussed Page 6 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma below.
In case entitled as "Rangappa vs Sri Mohan" [(2010), 11, Supreme Court Cases 441] where the Hon'ble Supreme Court of India, held that the bare denial of the passing of the consideration apparently does not appear to be any defence. To disprove the presumptions, the defendant has to bring on record such facts and circumstances, upon consideration on which the Court may either believe that the consideration does not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it does not exist and it was held that there is an initial presumption, which favours the complainant in the sense that the presumption mandated by Sec. 139 of NI Act does indeed include the existence of a legally enforceable debt or liability. Since the accused did admit that the signatures on the cheques was his, the statutory presumption comes into play and same has not been rebutted even with regard to the material submitted by the complainant.
11. In the judgment "Hiten P. Dalal vs. Bratindra Nath Banerjee" AIR 2001 (SC) 3897 it was held that presumption under NI Act is a presumption of law as distinguished from a presumption under a fact which describes provisions by which the Court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with presumptions of innocence because by the later all that is meant is Page 7 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. Obligation on the prosecution may be discharged with the help of presumption of law or fact unless the accused adduces evidence showing the reasonable possibility of non-existence of a presumed fact.
12. In the judgment entitled "Pradeep Aggarwal & Ors vs Y. K. Goel", Cr. M. C. 66/2009 (Hon'ble High Court of Delhi), where it was held that complaints u/s 138 NI Act is a summary trial and accused should first disclose his defence and merely saying "He is innocent" or "He plead not guilty" will not be sufficient and onus is on the accused to show that no offence could have been deemed to be committed by him for some specific reasons and defences.
It was further held that u/s 138 NI Act, there is no presumption that even if an accused fails to bring out his defence, he is still to be considered innocent.
13. In the judgment "Mosaraf Hossain Khan vs Bhagheeraha Engg. Ltd." AIR 2006 S. C. 128(2006), it was held that the object of the provision of section 138 NI Act is that for proper and smooth functioning of business transaction in particular, use of cheques as negotiable instruments would primarily depend upon the integrity and honesty of the parties. It was noticed that cheques used to be issued as a device inter Page 8 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma alia for defrauding the creditors and stalling the payments. Dishonour of a cheque by the bank causes incalculable loss, injury and inconvenience to the payee and the entire credibility of the business transactions within and outside the country suffers a serious setback.
14. In the judgment "K.N. Beena Vs. Muniyappan, AIR 2001 SC 2895, where it was held that mere denial / averments in reply by the accused are not sufficient to shift the burden of proof onto the complainant. Accused has to prove in trial by leading cogent evidence that there was no debt or liability, which in the present case accused has not done.
15. From the perusal of material on record and evidence it is well established that both the complainant and accused are known to each other from quite some time as accused was class mate of daughter of the complainant. The signatures on the cheque have been admitted by the accused. Accused has taken the defence that she took the loan of Rs.1 Lac from one Mr. Satbir Bhardwaj and not from the complainant. Mr. Satbir Bhardwaj was introduced to the accused by Ms. Pushpa, the daughter of the complainant. Accused has also taken the defence that she repaid the entire loan amount along with interest of Rs.30,000/- to Mr. Satbir Bhardwaj by taking the loan from Jain Page 9 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma Co-operative bank and paid Rs.1,30,000/- to Mr. Satbir Bhardwaj. Accused has also taken the defence that the cheque in question were obtained from her by coercion and threat when Mr. Satbir Bhardwaj came along with Ms. Pushpa and two other persons at her residence. In this regard, accused's father had made a complaint to the police. The aforesaid submissions are not convincing to the court and cannot be appreciated in right perspectives in the facts and circumstances of the case. Assuming for a moment, the version of accused to be correct then what prevented her to examine Mr. Satbir Bhardwaj in her defence. Meaning thereby that accused owes a debt and liability towards the complainant. The documents relied upon by the accused fail to rebut the statutory presumptions in favour of the complainant. Mere averments without any cogent evidence does not create any defence in favour of the accused.
So far as contention that other columns in cheque were not filled in by the accused. This contention does not have any force. No law requires that all the columns must be filled in by the drawer / maker himself. If signature on the cheque is admitted, the same will be sufficient. Concept of blank signed cheque is virtually immaterial in view of several judgments of Hon'ble High Court of Delhi viz. Ravi Chopra vs State And Anr. 2008(2) JCC (NI) 169, Vijender Singh vs M/s Eicher Motors Limited & Anr. Crl. M. C. No.1454/2011 decided on 05.05.2011, Tarun Gautam vs State Crl. M. C. No. 529/2012 decided on 13.02.2012 and Manoj Sharma vs Anil Aggawal Crl. M. C. Page 10 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma 1325/2012 decided on 20.04.2012.
So far as claim of non service of legal demand notice is concerned, the same cannot help the accused as there are sufficient material to presume the service of notice. Accused has never tried to examine any witness to establish that he had not deliberately avoided the service of notice. The claim of the accused for non service of notice cannot be accepted. A three judges bench of the Hon'ble Supreme Court in CC. Alavi v. Palapetty Muhammed and Another (2007) 6 SCC 555 has held that :-
"Any drawer who claim that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint within the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G. C. Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation."
A three judges bench of Hon'ble Supreme Court in Rangappa vs S. Mohan (2010) 11 SCC 441) has held that:
".............Furthermore, the very fact that the accused had failed to reply to the statutory notice under Section 138 of the Act leads to the inference that there Page 11 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma was merit in the complainant's version........."
Accused has also taken the defence that complainant has filed two affidavits and has changed her version regarding the issuance of cheque. This argument is without any merits as the complainant has given a reasonable explanation that her earlier counsel had distorted the facts and she being an illiterate lady could not understand at the time of filing of the complaint and the same necessitated the filing of fresh affidavit. Hence, the accused has miserably failed in substantiating her defence and showing that there is no liability of the accused towards the complainant.
16. The main contention of the accused is that the cheque in question was dishonored for the reason "account closed". It is argued on behalf of accused that the reason of dishonor i.e "account closed" does not fall within the ambit of the provision of sec. 138 of N. I Act. In banking practices the proforma or return memo is given by the bank for the return of the cheque. Said proforma is used only to indicate that the cheque is not honoured for a particular reason mentioned therein. A person in whose favour the cheque has been issued is entitled to have that amount provided there is sufficient amount to the credit of that account. Following the dishonor of cheque a notice has to be issued to the person who has issued the cheque inviting his attention to the fact that the cheque has been dishonored for the reason stated in the bank memo and that he is liable Page 12 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma for penal consequence under the provision of sec. 138 N. I. Act. When the reason for the return of the cheque has been mentioned in bank returning memo then it is primary duty of drawer of the cheque to make the payment of the said amount of money to the payee within 15 days of the receipt of the said notice, and he fail to comply with clause
(c) of the sec. 138, the filing of the complaint within a month from the date of cause of action is also provided for under clause (b) section 142 of the Act. Thus, a notice has to be given to the drawer and the notice is condition precedent. That means, the drawer of the cheque has got an opportunity to know in advance before filing of the complaint the cheque was dishonored for a particular reason. When that information was already available with him and when he has not made any attempt to pay the same, it cannot be said that the cheque was returned not for insufficiency of funds or funds not arranged for. When an opportunity has been given to the drawer of the cheque by inviting his attention and when he has not paid the amount, it has to be construed that "account closed", ultimately, resulting in the dishonoring of the cheque and preventing the payee from getting amount which is only on the account of the act committed by the drawer who has given the cheques. The drawer of the cheque himself is prima facie answerable for the dishonor of cheque. Therefore, it cannot be said that for the cheque in question which was returned by the bank as dishonored, the provision of sec. 138 of N. I Act are not attracted at all.
Page 13 of 18
Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma
17. Ld. Counsel for the accused has relied upon the judgment entitled as "Krishna Janardhan Bhatt vs Dattatraya G. Hegde", (2008) (4) Supreme Court Cases 54. I have highest regard for the case law cited on behalf of the accused, however, same has been pronounced in different context and is of no help to the accused.
18. The complainant successfully proved all the essential requirements of sec 138 of the Act i.e. :
a) The cheque for an amount is issue by the accused to the complainant on a bank account maintained by him.
b) The said cheque is issued for the discharge, in whole or in part of any debt or other liability by the accused.
c) The cheque is returned by the bank unpaid on account of insufficient amount to honour the cheque.
d) The cheque is presented to the bank within 6 months from the date on which it is drawn and is within the period of its validity.
e) Within 30 days demand notice is issued by the complainant on receipt of information by him from the bank regarding the dishonour of the cheque.
f) The drawer of the said cheque / accused fails to make the payment of the said amount Page 14 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma of the money to the complainant within 15 days of the said notice.
g) The debt or liability against which the cheque was issued is legally enforceable.
19. Under the aforesaid discussion, accused Ms. Rachna Sharma is held guilty for offence U/s 138 NI Act and she is consequently convicted for the offence u/s 138 of Negotiable Instruments Act.
Announced in open court (Deepika Singh) today i.e. on 04.04.2013 MM -03 NI Act / Central / Delhi Page 15 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma IN THE COURT OF MS. DEEPIKA SINGH, METROPOLITIAN MAGISTRATE-03, CENTRAL, DELHI CC No. 1856/11 Ms. Kaushalaya Devi W/o Late Shri Jassi Ram R/o N-460, Chandershekhar Azad Colony Kishan Ganj, Delhi-7. ....................Complainant vs. Ms. Rachna Sharma D/o Shri Narender Sharma R/o B-18, Swamy Dayanand Colony, Amba Bagh, Near Police Control Room, Sarai Rohilla, Delhi-7. ............................Convict ORDER ON SENTENCE : 10.04.2013 Present : Complainant in person. Convict in person along with Ld. counsel. Arguments heard on sentencing.
Ld. counsel for the convict has argued that convict has a large family to support including two school going children. She is a home maker only and has no independent source of income. She has been bona-fide throughout in her conduct before the court, hence lenient view should be taken towards her.
Since the cases of dishonoring of the cheques are on high rise Page 16 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma in the society, therefore, court is not inclined to take lenient view and release the convict under Probation of Offenders Act as it would not be having any deterrent effect.
Almost 11 years have elapsed since the cheque was dishonored and the same has yet not been repaid to the complainant.
Keeping in view this conduct of the convict, no leniency ought to be granted to her. It is true that the object of Section 138 N.I. Act is to inculcate faith in the efficacy of banking operations and credibility in transacting business on negotiable instrument. It may also be noticed that when this offence was inserted in the statute in 1988, it provided for imprisonment upto one year which was revised to two years following the amendment to the Act in 2002, which makes it quite evident that the legislative intent to provide a strong criminal remedy in order to deter the worryingly high incidence of dishonour of cheques. In the present case, this faith has been breached and warrants imposition of imprisonment and payment of compensation.
After hearing the arguments, court is of the considered opinion that convict Ms. Rachna Sharma is sentenced to simple imprisonment for three months and she is further liable to pay a compensation of Rs. 1,30,000/-(Rs. One lac thirty thousand only) to the complainant within two months from today i.e. 10.04.2013 failing which, she will be liable to further simple imprisonment of three months.
At this stage, Ld. Counsel for the convict has filed an application for suspension of sentence, so that he can file an appropriate appeal Page 17 of 18 Ms. Kaushalaya Devi Vs. Ms. Rachna Sharma before the appropriate court. Hence convict is admitted to bail for 30 days on furnishing bail bond in the sum of Rs.20,000/- along with one surety of like amount.
Bail bonds furnished. Accepted.
Convict is admitted to bail till the expiry of 30 days.
Come up before this court on 10.05.2013. Copy of the judgment and order on sentence is given free of cost to the convict.
Announced in open court (Deepika Singh)
today i.e. on 10.04.2013 MM-03 NI Act / North / Delhi
Page 18 of 18