Delhi District Court
M/S Libra Finance Ltd. vs Tulsi Ram on 7 January, 2013
IN THE COURT OF SHRI ABHILASH MALHOTRA:METROPOLITAN
MAGISTRATE:DWARKA COURTS:NEW DELHI
CC. No. 315/12
Unique Case ID No. : 02405R0198922011
Libra Finance Ltd,
B-2, Bhargava Lane, Boulevard Road,
Near Tis Hazari Courts, Delhi - 110054,
Through its attorney/ Authorised Representative
Sh. Surinder Singh
......... Complainant
VERSUS
Tulshi Ram S/o Sh. Shiv Ram
At :
Vill. Sukhan, P.O. Danoghat,
Teh Arki Distt. Solan, Himachal Pradesh
....... Accused
Offence complained of or proved : Under Section 138 of
Negotiable Instruments Act, 1881.
Plea of the Accused : Pleaded not guilty
Date of filing : 24.06.2011
Date of Institution : 07.07.2011
Date of reserving judgment/order : 03.01.2013
Final order/Judgment : Accused is acquitted
Date of pronouncement of judgment : 07.01.2013
BRIEF FACTS AND REASONS FOR THE DECISION OF THE CASE:-
1. The present complaint is filed U/s 138 of Negotiable Instruments Act, 1881. The complainant bank is engaged in business of financing. Complaint is filed by the complainant through Authorised Representative Sh. Surinder Singh. It is the case of M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 1/8 the complainant that accused availed hire purchase facility from the complainant vide agreement no. 461529. In discharge of part of its debt, accused issued cheque in question bearing no. 239286 dated 14.04.2011 drawn on UCO Bank, Darlaghat (Dt. Solan) -171102 (H.P.) for a sum of Rs. 1,46,900/- to the complainant. On presentation said cheque was dishonored with reason "Funds Insufficient". Complainant sent a legal notice dated 10.05.2011 to the accused. Accused failed to make the payment and the present complaint has been filed.
2. In present case the accused was summoned on 01.08.2011 by my Ld. Predecessor. Thereafter, on 01.12.2011 notice U/s 251 Cr.PC. was framed and accusation U/s 138 Negotiable Instruments Act,1881 were explained to the accused. Accused pleaded not guilty and claimed trial.
3. In order to discharge its onus, the complainant has examined CW1 Sh. Surinder Singh. CW1 Sh. Surinder Singh has brought on record documents Ex. CW1/A to Ex. CW1/I. He has also filed on record documents Ex. CW1/J (Colly) and document Mark'X', Mark 'Y' and Mark 'Z'. Accused was examined U/s 313 Cr.PC. on 25.09.2012. Accused has not lead any defense evidence in present case.
4. Document Ex. CW 1/A is Complaint, Ex. CW1/B is General Power of Attorney, EX.CW1/C is cheque in question, Ex. CW1/D is Cheque Return Memo, Ex. CW1/E is Legal notice dated 10.05.11, Ex. CW1/F1 is postal receipt, Ex. CW1/F2 is Courier receipt, Ex.CW1/G is Consignment Tracking report, Ex.CW1/H is Copy of agreement dated 26.05.2006 bearing no. L-1529, Ex. CW1/I is Statement of Account, Ex. CW1/J is Copy of Despatch Register, Mark'X' (Colly) is Reminder/Notices, Mark 'Y' is Agreement no. D-2147 dated 03.06.2008 and Mark 'Z' is Statement of account.
5. I have heard the arguments and perused the record. Accused has admitted that M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 2/8 he availed a hire purchase facility from complainant and issued the cheque in question Ex. CW1/C to the complainant. It is the case of the accused that the cheque in question was issued as a blank signed security cheque. It is submitted that accused has also made a payment of Rs. 1,82,000/- to the complainant and not liable to make any other payment. It is also contented by the accused that the vehicle in question was stolen and thereafter the complainant should have realized the balance amount (if any) from the Insurance Company. It is argued that accused has not received legal notice dated 10.05.2011 Ex CW 1/E and the postal receipts Ex CW 1/F1 and CW 1/F2 are not addressed to accused as they show name of one 'Sh. Prithvi Raj' written on them. It is submitted that complainant has not sent the legal notice to the accused and has also failed to bring on record the postal receipts pertaining to the notice sent to accused. It is argued that as complainant has never sent any legal notice therefore offense U/s 138 NI Act is not made out. On other hand it is argued by counsel for the complainant that accused has admitted receipt of notice during examination under section 251 Cr.PC. It is also submitted that accused has failed to lead any evidence to show that cheque in question is a security cheque and has also failed to rebut the presumption under section 139 N.I. Act. It is further submitted that accused has not lead an evidence to show that financed vehicle was stolen and accused has made payment of Rs.1,82,000/-
6. Accused has taken defense that the cheque in question has been issued as security cheque at the time of availing the hire purchase facility. Accused has failed to lead any evidence to show that the cheque in question was issued as security cheque. The complainant has filed on record the loan agreement and statement of account in order to establish liability of the accused on the date of cheque. Therefore, in the absence of any evidence it cannot be said that the cheque in question was a security cheque. The Hon'ble High Court of Delhi in case of V.S.Yadav vs Reena, CRL. A. NO.1136 of 2010 held that:
M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 3/8
"7. The respondent has placed reliance on Krishna Janardhan Bhat v. Dattatraya G. Hegde, 2008 Crl.
L.J. 1172, which is also the case relied upon by the Trial Court. In this judgment itself Hon'ble Supreme Court has specifically observed that Court should not be blind to the ground realities and the rebuttal of presumption under Section 139 of N.I. Act would largely depend upon the factual matrix of each case.
The Trial Court in this case Crl. A. No. 1136 of 2010 Page 5 of 7 turned a blind eye to the fact that every accused facing trial, whether under Section 138 of N.I. Act or under any penal law, when charged with the offence, pleads not guilty and takes a stand that he has not committed the offence. Even in the cases where loan is taken from a bank and the cheques issued to the bank stand dishonoured, the stand taken is same. Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under Section 139 of N.I. Act. If mere statement under Section 313 Cr. P.C. or under Section 281 Cr. P.C. of accused of pleading not guilty was sufficient to rebut the entire evidence produced by the complainant/ prosecution, then every accused has to be acquitted. But, it is not the law. In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption u/s 139 N.I. Act. If no loan was given, but cheques were retained, he immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he would have served a notice as complainant. Nothing was proved in this case."
7. It is also argued for accused that the vehicle in question was stolen on 17.11.07 and therefore he has not paid the remaining installments to the complainant. On the other hand, CW1 has stated that the accused has got the vehicle dismantled and sold the same in scrap market. I am afraid that the accused has failed to bring any document on record to show that the vehicle was stolen. No complaint, FIR has been M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 4/8 filed on record to show that the financed vehicle has been stolen. In the absence of any document in this regard, the defence of the accused that the complainant should have claimed the remaining financed amount from the insurance company is not tenable and this contention is also rejected. Statement of account Ex. CW1/I shows that accused has made a substantial payment of Rs. 58,400/- to complainant on 03.06.08. It remained inexplicable why the said payment has been made by the accused in case the vehicle was stolen on 17.11.07.
8. Accused has contended that legal notice Ex CW 1/E is not received by him and the complaint is not maintainable. Before proceeding further to decide the aforesaid contention, it would be relevant to look legal position in this regard. The Hon'ble Supreme Court in K. Bhaskaran vs Sankaran Vaidhyan Balan And Anr, 1999 (7) SCC 510 held that:
"15. The offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. Following are the acts which are components of the said offence: (1) Drawing of the cheque, (2) Presentation of the cheque to the bank, (3) Returning the cheque unpaid by the drawee bank, (4) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) failure of the drawer to make payment within 15 days of the receipt of the notice."
9. In M/S. Harman Electronics (P) Ltd. vs M/S. National Panasonic India Limited, (2009) 1 SCC 720 it was held that :
"....For constitution of an offence under Section 138 of the Act, the notice must be received by the accused. It may be deemed to have been received in certain situations. The word `communicate' inter alia means `to make known, inform, convey, etc.'
24. Indisputably all statutes deserve their strict application, but while doing so the cardinal principles therefor cannot be lost sight of. A Court derives a jurisdiction only when the cause of action arose within his jurisdiction. The same cannot be conferred by any act of omission or commission on the part of the accused. A distinction must also be borne in mind M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 5/8 between the ingredient of an offence and commission of a part of the offence. While issuance of a notice by the holder of a negotiable instrument is necessary, service thereof is also imperative. Only on a service of such notice and failure on the part of the accused to pay the demanded amount within a period of 15 days thereafter, commission of an completes. Giving of notice, therefore, cannot have any precedent over the service. It is only from that view of the matter in Dalmia Cement (Bharat) Ltd. v. Galaxy Traders & Agencies Ltd., [ (2001) 6 SCC 463 ] emphasis has been laid on service of notice."
10. In C.C. Alavi Haji vs Palapetty Muhammed & Anr, (2007) 6 SCC 555 it was observed that:
"As noted hereinbefore, Section 138 of the Act was enacted to punish unscrupulous drawers of cheques who, though purport to discharge their liability by issuing cheque, have no intention of really doing so. Apart from civil liability, criminal liability is sought to be imposed by the said provision on such unscrupulous drawers of cheques. However, with a view to avert unnecessary prosecution of an honest drawer of the cheque and with a view to give an opportunity to him to make amends, the prosecution under Section 138 of the Act has been made subject to certain conditions. These conditions are stipulated in the proviso to Section 138 of the Act, extracted above. Under Clause (b) of the proviso, the payee or the holder of the cheque in due course is required to give a written notice to the drawer of the cheque within a period of thirty days from the date of receipt of information from the bank regarding the return of the cheque as unpaid. Under Clause (c), the drawer is given fifteen days time from the date of receipt of the notice to make the payment and only if he fails to make the payment, a complaint may be filed against him. As noted above, the object of the proviso is to avoid unnecessary hardship to an honest drawer. Therefore, the observance of stipulations in quoted Clause (b) and its aftermath in Clause (c) being a pre-condition for invoking Section 138 of the Act, giving a notice to the drawer before filing complaint under Section 138 of the Act is a mandatory requirement."
M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 6/8
11. Accused has contended that legal notice Ex CW 1/E is not received by him. The postal receipts Ex CW 1/F1 and CW 1/F2 shows the name of one 'Sh. Prithvi Raj' written on it. The said position is also admitted by CW1 Sh. Surinder Singh in his cross examination. Complainant has failed to bring on record the postal receipt pertaining to present case despite clear objections and defense taken by the accused. CW 1 has filed entries from dispatch register which are ex CW 1/J. These entry do not show the record pertaining to year 2011 and do not show the status of notice Ex CW 1/E on 10.05.2011. In the absence of postal receipts the presumption under Section 27 General Clause Act, 1897 and Section 114 Indian Evidence Act, 1872 do not attract. Complainant has failed to prove that notice Ex Cw 1/E has been sent to the accused. Therefore offense under Section 138 NI Act is not completed due to non sending of legal notice.
12. Counsel for complainant has argued that accused has admitted receipt of notice Ex CW1/E dated 10.05.2011 in examination U/s section 251 Cr.PC. done on 01.12.2011. The statement given under section 251 Crpc do not have any evidentiary value and do not wipe out the defect in complainant's case. In R.P. Bajaj And Ors. vs State And Ors., 1985 (8) DRJ 139 Hon'ble High court of Delhi held that:
"(9) It is, therefore, obvious that both the report Ex.
P2 and the statement of Public Witness 2 are absolutely useless. Learned counsel for D.D.A., however, laid great stress on the statement of R.P. Bajaj which was recorded in reply to the notice under Section 251 Cr.P.C. That statement has already been reproduced above.
Learned counsel contended that that clearly showed that it was R.P. Bajaj who was using the plot as a 'godown'.
(10) But the aforesaid statement of R.P. Bajaj is hardly relevant and admissible. The said statement could be of use if it amounted to plea of guilty. Then he could be convicted and sentenced there and then under Section 252 Cr.P.C. by the learned Magistrate. But that was not so. This statement of an accused, therefore, could not be taken as evidence against him."
13. Apart from aforesaid the statement of account filed by the complainant do not M/s Libra Finance Ltd. Vs Tulsi Ram CC. No. 315/12 Judgment dated 07.01.2013 Page No. 7/8 show the complete state of affairs. The cheque in question is dated 14.04.2011. It has been dishonored on 26.04.2011. Statement of account Ex Cw 1/I is showing account as on 14.4.2011. But it gives the details of receipt, payment and overdue charges till 26.05.2009. It is silent as to payment/charges/interest details from 2009 till 2011. Complainant has also filed another statement of account showing the account as on as on 11.04.2012. But on comparing the balance on 26.05.2009 with CW 1/I, there is difference in amount of overdue charges. On 26.05.2009 other statement shows overdue charges as Rs. 54,568.80/- whereas the statement Ex. CW 1/I shows the overdue charges as Rs. 66,690.27/-.
14. For the aforesaid reasons, it is clear that offense under Section 138 Negotiable Instruments Act, 1881 is not made out against the accused and he is acquitted and be set at liberty.
15. Bail bond stands cancelled and Surety if any, stands discharged. Endorsement on documents of surety, if any be cancelled. Original documents of surety, if any be returned against proper identification and acknowledgment.
File be consigned to record room as per rules.
Announced in the open (ABHILASH MALHOTRA)
court on 07.01.2013 MM-06/Dwarka Courts,
New Delhi/07.01.2013
M/s Libra Finance Ltd. Vs Tulsi Ram
CC. No. 315/12
Judgment dated 07.01.2013 Page No. 8/8