Delhi District Court
Ajay Kumar vs Mukesh Tanwar on 5 October, 2024
IN THE COURT OF SH. NAVJEET BUDHIRAJA,
ADDITIONAL SESSIONS JUDGE-02, SOUTH
DISTRICT, SAKET COURTS, NEW DELHI
CRIMINAL APPEAL NO. 252/2023
CNR NO. DLST01-008889-2023
IN THE MATTER OF
Ajay Kumar
S/o Sh. Lekh Ram
R/o H. No. C-32, First Floor
Rajpur Khurd Extension
New Delhi-110068
Also at
Budget Couriers Pvt Ltd
335/2, Budget House
Daya Complex, NH-8
Rangpuri, New Delhi-110037 ........ appellant
Versus
Mukesh Tanwar
S/o Sh. Rajender Singh Tanwar
R/o 1042, Ward no.8
Mehrauli, New Delhi ........ Respondent
DATE OF INSTITUTION : 16.09.2023
DATE OF RESERVING ORDER : 12.09.2024
DATE OF PRONOUNCEMENT : 05.10.2024
DECISION : Dismissed
Digitally signed by
NAVJEET NAVJEET
BUDHIRAJ
BUDHIRAJ Date: 2024.10.05
15:19:10 +0530
1 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023
JUDGMENT
The present appeal under section 374(3) Code of Criminal Procedure, 1973 (Cr.P.C) has been filed against the judgment of conviction dated 06.06.2023 and order on sentence dated 14.07.2023 passed by Sh. Rakesh Siddhartha, Ld. Presiding Officer, Special Court (NI Act), South District, New Delhi in case titled as Mukesh Tanwar Vs. Ajay Kumar, CC no. 11447/2018. Vide impugned judgment dated 06.06.2023, the appellant has been convicted for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short 'NI Act') and vide order on sentence dated 14.07.2023, the appellant has been sentenced to undergo imprisonment for a period of six months and fine of Rs. 8,60,000/- to be paid within six months of the order dated 14.07.2023, and out of the said amount 10% is directed to be deposited in the Delhi Legal Aid Services Authority and in default of payment of fine, simple imprisonment for a period of one month.
2. The substratum of the complaint is that respondent is a friend of the appellant and in good faith, respondent gave a friendly loan of Rs.8,60,000/- in cash to the appellant in September, 2017 and in this regard, a written agreement Ex.CW1/A was entered to ensure that appellant would refund the amount within six months and in discharge of the said loan, the appellant issued post dated cheque of Corporation Bank vide cheque bearing no.391255 dated 11.06.2018 of Rs.8,60,000/- as Ex.CW1/B in favor of the respondent and after the expiry of period of 6 months, the respondent demanded 2 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed by NAVJEET NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:19:15 +0530 the repayment of the said loan but the appellant avoided the payment to the respondent and, therefore, the respondent presented the said cheque with his banker on 11.06.2018 but the same was dishonored and returned on 20.06.2018 with the remark 'fund insufficient'.
3. Thereafter, respondent got issued legal notice dated 30.06.2018, served through his counsel requiring the appellant to pay aforesaid loan amount within 15 days of receipt of the legal notice, failing which the appellant would be liable to be prosecuted under section 138 NI Act.
4. Post receiving of the legal notice, appellant did not make the payment, therefore, the respondent filed the complaint before the Ld. Trial Court which found that prima facie case against the appellant was made out under section 138 NI Act and notice was framed under section 251 Cr.P.C in which appellant pleaded not guilty and claimed trial.
5. During trial before the Ld. Trial Court, appellant took a defence that he had borrowed Rs.4,00,000/- from the respondent and the cheque in question was given as security to the respondent. The cheque in question was also admitted to be signed by the appellant. Appellant stated that he had returned Rs.9,60,000/- to the respondent till date. He also admitted to have received the legal demand notice, however, no reply thereto has been sent. Appellant Digitally signed by NAVJEET NAVJEET BUDHIRAJ 3 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 BUDHIRAJ Date:
2024.10.05 15:19:20 +0530 had stated that he has no legal liability to pay the amount to the respondent.
6. The grounds of the present appeal are that the impugned judgment is perverse, palpably wrong, manifestly erroneous due to misreading of evidence, demonstrably unsustainable in the eyes of law, is based on presumptions and assumptions, conjectures and surmises, devoid of merits, Ld. Trial Court had overlooked the material evidence resulting in flagrant miscarriage of justice, respondent had not supported his case on the ground of friendly loan through any documents i.e. bank statement or any mode through which he made the payment to the appellant, the proof of transaction was not made which makes the instant case of friendly loan doubtful, respondent should have presented the cheque in question on or before 16.03.2017 as per agreement, however, the same was deposited after an unexplained period of three months, the respondent is a property dealer and is income tax payee but has not produced ITR before Ld. Trial Court.
7. On behalf of the respondent, no formal reply to the appeal was filed and it was canvassed by Ld. Counsel for respondent on 18.12.2023 that he would straightway address the arguments.
8. On behalf of the appellant, Sh D K Singh, Ld. Counsel advanced the arguments on appeal and on behalf of respondent, Ld. Digitally signed by NAVJEET NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05
4 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 15:19:28 +0530 Counsel Sh. Deepak Gaur presented the rebuttal arguments.
9. The landscape of the complaint which was filed under section 138 NI Act as culled out from the trial court record is that both the respondent and appellant were known to each other for many years, being friends reposing faith and trust in each other. In the month of September 2017, appellant asked for a friendly loan from respondent in the sum of Rs.8.60 lacs on the pretext of appellant going through financial crisis and who needed money for his business. The respondent agreed to help the appellant and arranged for an amount of Rs.8.60 lacs in respect of which a written agreement was materialized between the parties with stipulation to return the amount within 6 months. Further, to win the trust of the respondent, appellant issued a post dated cheque bearing number 391255 dated 11.06.2018 of Rs.8.60 lacs but after the passage of six months when the respondent asked the appellant for his money, the appellant expressed some difficulty and requested for some more time and after patiently waiting for repayment from the appellant side, the respondent presented the cheque in question dated 11.06.2018 drawn on Corporation Bank, Connaught Circus Branch, New Delhi which got dishonored with return memo dated 20.06.2018 with remarks 'funds insufficient'. Respondent thereafter sent a legal notice dated 30.06.2018 through speed post thereby calling upon the appellant to pay the aforesaid amount but since the appellant failed to pay the amount within the stipulated period, the respondent resorted to legal recourse by filing the complaint under Digitally signed by NAVJEET NAVJEET BUDHIRAJ 5 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 BUDHIRAJ Date:
2024.10.05 15:19:33 +0530 section 138 NI Act.
10. Respondent proffered his testimony in the form of evidential affidavit Ex.CW1/D on similar lines as his complaint. The stand of the appellant as can be noted from the different stages during the inquiry and trial in the complaint is that he borrowed an amount of Rs.4 lacs from the respondent, the cheque in question was given as security to him, the cheque in question was signed by him, he had returned the amount of Rs.9,60,000/- to the respondent, had received the legal notice of demand but did not send any reply to the same and that he had no legal liability to pay the cheque amount to the respondent. This was precisely the stand of the appellant while service of notice under section 251 Cr.P.C upon him.
11. Record further demonstrates that during cross examination of respondent as CW1, he affirmed that appellant used to take financial help from him since 2015 and he had previous transactions with the appellant. His cross examination further demonstrates that on behalf of the appellant, the facts as asseverated in the complaint were again put to respondent. He also affirmed that the amount and the signature on the cheque Ex.CW1/B is of the appellant. He acknowledged that the date on the cheque was put by him. He denied that amount of Rs.8.60 lacs was filled by him and that the appellant never took any financial help from him in September 2017. He also denied having received cheque from the appellant at the time of financial help taken by the appellant in 2015.Digitally signed by NAVJEET
6 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 NAVJEET BUDHIRAJ BUDHIRAJ Date:
2024.10.05 15:19:38 +0530
12. Appellant, during his questioning under section 313 Cr.P.C, canvassed that he availed the friendly loan of Rs.4 lacs in the month of September 2017, given the blank signed cheque for the said amount but the respondent misused the cheque and filed the complaint. With regard to written agreement, stand of the appellant was that he entered into an agreement with the respondent but he had forcefully signed the same and he had already paid Rs.4 lacs to the respondent because the respondent pressured him to enter into the said agreement. He again affirmed having received the legal demand notice from the complainant and having not replied the same. In his defence, the appellant was examined as DW1 wherein he stated that respondent is his neighbor, he took loan of Rs.4 lacs from him in the year 2015 and against the said loan, he deposited two cheques as security, he had already returned Rs.4 lacs to the respondent, when he demanded the cheque, respondent asked him to sign a new agreement, respondent forced him to sign the agreement in front of 4-5 persons, he signed the agreement under duress, he made payments to the respondent online and cash also and that he has placed on record the copies of online monies transferred receipts.
13. In his cross examination, appellant fessed up that he did not file any complaint immediately after signing of the said agreement, that no FIR was registered against the complainant for forcefully signing the agreement nor the appellant had proceeded with any case against the appellant before any court. Further, when Digitally signed by NAVJEET NAVJEET BUDHIRAJ
7 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 BUDHIRAJ Date:
2024.10.05 15:19:44 +0530 the cheque in question Ex.CW1/B was shown to the appellant, he affirmed that except the date mentioned on the cheque, all other things were filled by him.
14. Ld. Trial Court, post appreciating afore-noted evidence on either side, came to the following conclusion:
"12. It is not disputed that the cheque in question had not been issued by the accused from the account maintained by him and the signature on the aforesaid cheque has also been admitted by the accused. It is a fact that the cheque had been dishonored on presentation for the reasons "Funds Insufficient", it has been admitted by the accused that he had instructed the bank to stop the payment but the memo does not reflect the same. The evidence raised by the accused are not corroborated and since evidence that has been led by the accused does not reflect that there is no liability whatsoever and the proof of payment of Rs.8,00,000/- has also not been placed on record to show that the accused has discharged the liability. In fact the cheque in question is admittedly presented for encashment and on the non-payment of the accused of the loan amount and as the liability of the accused stood on the date when the cheque was presented it cannot be said that the aforesaid cheque in question was a security cheque. It is correct that the aforesaid may have been issued as the security cheque but if the payment of the complainant was forthcoming and the loan was being discharged from any other source
8 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed by NAVJEET NAVJEET BUDHIRAJ BUDHIRAJ Date:
2024.10.05 15:19:48 +0530 other than the instant cheque, the said defence cannot be taken. The instant cheque being a security cheque and on failure of payment of the loan amount to the complainant aforesaid security cheque would be utilised to ensure the payment and clearance of the liability.
13. Keeping in view this fact that the accused has already admitted that he had taken loan and payment has not been shown to have been made to repay the aforesaid loan. In consequence, the liability of the accused is writ large. I accordingly hold the accused guilty u/s 138 of NI Act."
15. It has been rightly noted above by Ld. Trial Court that the issuance of cheque in question by the appellant from the account maintained by him is not demurred by him. Rather, when the appellant was confronted with the cheque in question Ex.CW1/B, in his cross examination, he affirmed that all the contents of the same except the date were filled by him. This being the position on record, the stand of the appellant that he did not borrow sum of Rs.8,60,000/- from the respondent appears to be specious and untruthful in as much as if he had borrowed only Rs.4 lacs from the respondent, what was the occasion for him to have handed over a duly filled cheque of Rs.8,60,000/- to the respondent. The fact that the amount of Rs.8,60,000/- in the cheque Ex.CW1/B was duly filled by the appellant, the appellant cannot be believed that he only borrowed Rs.4 lacs from the respondent against which he handed over a cheque of Rs.8,60,000/-. His other fragment of the defence that he has already repaid the loan of Rs.4 lacs to the respondent
9 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed by NAVJEET NAVJEET BUDHIRAJ BUDHIRAJ Date:
2024.10.05 15:19:58 +0530 also is not substantiated as there is nothing on record to establish any repayment of the loan to the respondent. Though, the appellant deposed about placing on record copies of online monies transfer receipts but none of these have been exhibited and proved by the appellant. It is also not the case of the appellant that he wrote any correspondence to the respondent asking for return of his cheque if he had already repaid loan of Rs.4 lacs to the respondent.
16. The existence of the loan agreement on record is also a circumstance weighing heavily against the appellant. Though, apropos this, the stand of the appellant is that he entered into an agreement with the respondent but had forcibly signed the same because of the pressure of the respondent but this defence of the appellant also appears to be a ruse on his part in order to dodge his liability towards the cheque in question. In his cross examination, he categorically admitted that immediately after signing the said agreement, he had not filed any complaint which in the circumstance, is not a natural conduct. Had the respondent with his family members and 2-3 other persons coerced the appellant to execute the loan agreement, appellant would have immediately reported the matter to the police that he had been saddled with the liability to pay Rs.8,60,000/- to the respondent without actually owing that much amount him. Appellant also affirmed in his cross examination that no FIR was registered against the respondent for forcefully signing the agreement nor he proceeded with any case against the respondent. Further, appellant got an opportunity to put Digitally signed
10 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 NAVJEET by NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:20:03 +0530 forth his defence after the receipt of legal notice Ex.CW1/C by him but again he chose not to respond the same and, thus, this circumstance would further take the wind out of the appellant's sail. Appellant had categorically acknowledged having received the legal notice and not sending any reply to the same while service of notice under section 251 Cr.P.C and during his questioning under section 313 Cr.P.C.
17. In so far as the defence of the appellant and one of the contentions of Ld. Counsel for appellant that the cheque in question was a security cheque without any date filled therein, which was admittedly filled by the respondent, the Supreme Court has clarified the position that the holder of the cheque is entitled to fill its contents and the cheque even if issued for security purpose shall be valid and legal if there is existing liability of the drawer on the date of the presentation of the cheque. Reference is hereby made to the case of Bir Singh v. Mukesh Kumar, Criminal appeal no 230-231 of 2019 as under :
"38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
.....
"40. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards 11 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed NAVJEET by NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:20:10 +0530 some payment, would attract presumption under section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
18. Also in M/s Sampelly Satyanarayan Rao Vs Indian Renewable Energy on 19.09.2016 in Crl. Appeal No.867/16 the Supreme Court of India observed:
"We have given due consideration to the submission advanced on behalf of the appellant as well as the observations of this Court in Indus Airways (supra) with reference to the explanation to Section 138 of the Act and the expression "for discharge of any debt or other liability" occurring in Section 138 of the Act. We are of the view that the question whether a post-dated cheque is for "discharge of debt or liability" depends on the nature of the transaction. If on the date of the cheque liability or debt exists or the amount has become legally recoverable, the Section is attracted and not otherwise. Reference to the facts of the present case clearly shows that though the word "security" is used in clause 3.1(iii) of the agreement, the said expression refers to the cheques being towards repayment of installments. The repayment becomes due under the agreement, the moment the loan is advanced and the installment falls due. It is undisputed that the loan was duly disbursed on 28th February, 2002 which was prior to the date of the cheques. Once the loan was disbursed and installments have fallen due on the date of the 12 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed by NAVJEET NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:20:16 +0530 cheque as per the agreement, dishonour of such cheques would fall under Section 138 of the Act.
The cheques undoubtedly represent the outstanding liability.
Judgment in Indus Airways (supra) is clearly distinguishable. As already noted, it was held therein that liability arising out of claim for breach of contract under Section 138, which arises on account of dishonour of cheque issued was not by itself at par with criminal liability towards discharge of acknowledged and admitted debt under a loan transaction. Dishonour of cheque issued for discharge of later liability is clearly covered by the statute in question. Admittedly, on the date of the cheque there was a debt/liability in presenti in terms of the loan agreement, as against the case of Indus Airways (supra) where the purchase order had been cancelled and cheque issued towards advance payment for the purchase order was dishonoured. In that case, it was found that the cheque had not been issued for discharge of liability but as advance for the purchase order which was cancelled. Keeping in mind this fine but real distinction, the said judgment cannot be applied to a case of present nature where the cheque was for repayment of loan installment which had fallen due though such deposit of cheques towards repayment of installments was also described as "security" in the loan agreement. In applying the judgment in Indus Airways (supra), one cannot lose sight of the difference between a transaction of purchase order which is cancelled and that of a loan transaction where 13 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 Digitally signed NAVJEET by NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:20:21 +0530 loan has actually been advanced and its repayment is due on the date of the cheque."
19. Another contention on behalf of the appellant is that as per the loan agreement, the loan amount was to be returned in installments, therefore, appellant cannot be held liable for an amount of Rs.8.60 lacs which was a single shot payment. This contention also cannot be countenanced as it is not the case of the appellant that he had repaid the loan amount in installments to the respondent in which case the respondent was not entitled to have presented the cheque in question for encashment. In the absence of any proof of repayment of loan by the appellant either in installments or otherwise, the respondent was within his rights to present the cheque in question Ex.CW1/B for encashment towards the recovery of the loan.
20. Another contention on behalf of the appellant is in relation to non disclosure of the source of loan of Rs.8.60 lacs extended to the appellant by the respondent. However, this contention also does not pass any muster in view of the settled legal proposition that once the issuance of the cheque is admitted by the appellant, the presumption under section 139 NI Act kicks in and it is for the appellant to rebut the evidence, which in the instant case, he has miserably failed to do. Otherwise also, in the instant case, the respondent has been able to demonstrate the fact of extending the loan to the appellant by way of loan agreement Ex.CW1/A Digitally signed NAVJEET by NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 14 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023 15:20:25 +0530 containing a specific speculation in this regard, the execution of which is not repudiated by the appellant.
21. In the aforesaid backdrop, the impugned judgment dated 06.06.2023 and order on sentence dated 14.07.2023 do not warrant any interference. Appeal accordingly stands dismissed. Copy of this judgment be provided to appellant against acknowledgment.
PRONOUNCED IN OPEN COURT Digitally signed
ON 05.10.2024 NAVJEET
by NAVJEET
BUDHIRAJ
BUDHIRAJ Date:
2024.10.05
15:20:30 +0530
(NAVJEET BUDHIRAJA)
ASJ-02/SOUTH/SAKET COURTS
NEW DELHI/05.10.2024
Certified that this judgment contains 15 pages and each page bears my signatures. Digitally signed NAVJEET by NAVJEET BUDHIRAJ BUDHIRAJ Date: 2024.10.05 15:20:34 +0530 (NAVJEET BUDHIRAJA) ASJ-02/SOUTH/SAKET COURTS NEW DELHI/05.10.2024 15 Ajay Kumar Vs. Mukesh Kumar Tanwar CA No. 252/2023