Delhi District Court
M/S B.P.Consultants vs Ashwani Prasad on 13 September, 2022
IN THE COURT OF MS ABHILASHA SINGH :
METROPOLITAN MAGISTRATE - 02 : NI ACT: SOUTH : SAKET
COURT : NEW DELHI
CC NO. 465045/2016 , OLD NO. 959/2015
M/S B.P.CONSULTANTS VS ASHWANI PRASAD
UNIQUE IDENTIFICATION NUMBER-DL-ST-02-001114-2015
U/S 138 NEGOTIABLE INSTRUMENTS ACT
(MORE THAN SEVEN YEARS OLD)
JUDGMENT
(1) Serial number of the case : 465045/2016 (OLD NO. 959/2015) (2) Name of the complainant : M/s B.P. Consultants Pvt Ltd Office at A-22, Hauz Khas, New Delhi-
110016 (through its Director/AR) (3) Name of the accused, : Sh. Ashwani Prasad (Proprietor M/s Maurya Builders & Developers), office at B-4, 944/4, Gulati Chamber, Naiwala , Faiz Road, Karol Bagh, New Delhi -110005.
Also at - A-127, Sarojini Nagar, New Delhi-110023 (4) Offence complained of or proved : Section 138 Negotiable Instruments Act, 1881 (5) Plea of the accused : Pleaded not guilty (6) Final Order : ACQUITTAL (7) Date of Institution : 17.07.2015 (8) Date of Judgment : 13.09.2022 CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 1/27 BRIEF STATEMENT OF THE REASONS FOR THE DECISION
1. The brief facts of this case as carved out from the complaint are that complainant is a private limited company engaged in the business of financial consultancy and real estate consultants along with related services. Accused is a sole proprietor of M/s Maurya Builders and Developers having its office at B-4, 944/4, Gulati Chamber, Naiwala, Faiz Road, Karol Bagh, New Delhi -110005 and engaged in the business of development of the residential townships, plots, colonies and various other related projects/activities and one of such project was being developed by the accused in the name and style of Shree Kunj Vihar, Phase-I, Aatas Banger, Vrindavan, District Mathura, Uttar Pradesh.
2. In the year 2010, the accused entered into an agreement with the owner of the land at Vrindavan, Mathrua, UP for developing it into residential colony/complex. Thereafter, in the year 2011, the accused approached and persuaded the complainant to arrange investors/buyers for the purchase of the plots in the abovesaid project of Shree Kunj Vihar, the area under which has already been declared as ABADI under relevant provisions of section 143 of UP Zamidari Abolition and Land Reforms Act and wherein the accused were to develop it in the residential colony/complex. In pursuance to it, an MOU was executed dated 09.09.2011 between the accused and the complainant wherein it was agreed that the complainant would book the plots as per the layout plan, collect booking amount, further payments from the customers, issue receipts to the customer on behalf of accused and pass on the payments received to the accused. Further, any bookings done above the CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 2/27 predetermined rate would be retained by the complainant as its share of profit which includes its cost of marketing and commissions etc. It was also mutually agreed between them that in case, full payment received from the buyers was passed on to the accused, then the complainant would be entitled to a commission from the accused from time to time. Accordingly, the complainant had raised bills towards commissions, to which the accused had made some payments to the complainant after deducting the income tax at source, while several bills of the complainant still remain unpaid.
3. Further, in view of the said MOU, complainant brought various customers which included buyers and investors. It was agreed between them the investors in the project would get a fixed return on their investment after a fixed period of time and an arrangement of a buy back agreement of the plots was entered between the accused and the complainant. Further, on the behest of the accused and in pursuance of the aforesaid MOU for an assurance on the fixed return of the investor/s, an "MOU For Buy Back of Plot" was entered between the complainant and an investor.
4. On the basis of the abovesaid MOU between the accused and the complainant, an investor namely Mr. Prahlad Bisht S/o Late Sh. D.S.Bisht R/o A-28, Chhatarpur Enclave, New Delhi -110074 made an investment of Rs. 6,34,790/- at behest of the complainant and the accused allotted a plot no. C-2 (measuring 247 sq.yds) at Shree Kunj Vihar, Phase-I, Vrindavan, Mathura, UP to the investor. Further, investor Prahalad Bisht made a payment of Rs. 6,34,790/- towards full amount of CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 3/27 the said plot to the accused and the accused acknowledge the same and issued receipt against the payment made to the accused by the investor.
5. Further, since the complainant being a Guarantor/Channel Partner, hence to confirm the said assurance as given to the investor Sh.Prashad Bisht against the plot bearing no. A-10 (measuring 247 sq. yds) at Shri Kunj Vihar, Phase-I, Vrindavan, Mathura, UP regarding a fixed return of Rs. 16,30,200/-, the accused entered into an agreement ' For Buy Back of Plot' dated 19.11.2012 with the complainant and on the assurance given by the accused and accordingly, on behalf of the accused, the complainant as a Guarantor/Channel Partner issued a post-dated cheque no. 507556 dated 16.06.2015 for Rs. 16,30,200/- drawn on Canara Bank, Hauz Khas Branch, New Delhi-110016 to the Investor Mr. Prahalad Bisht as a security cheque. Further, in pursuance of the post-dated security cheque issued by the complainant to the investor Mr. Prahlad Bisht, the accused issued a post dated cheque no. 107882 dated 01.06.2015 for Rs. 16,30,200/- drawn on Punjab National Bank, CGHS, Patparganj, New Delhi-110092 in favour of the complainant company.
6. Further, on 25.05.2015, the complainant informed the accused regarding the payment of Rs. 16,30,200/- towards discharge of his legal liability in lieu of the post-dated cheque no. 107882 dated 01.06.2015 for Rs. 16,30,200/- to which the accused assured the complainant that there is sufficient balance in his account and aforesaid cheque would be honoured on its presentation to his banker.
7. The complainant presented the above said cheque to his banker CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 4/27 "Axis Bank, New Delhi but on presentation was dishonoured with remarks "funds insufficient" vide cheque return memo dated 02.06.2015 Thereafter, on failure of accused to pay the cheque amount, a legal demand notice dated 18.06.2015 which was deemed to be served upon the accused. Despite that payment of the cheque in question was not made by the accused within the stipulated time of 15 days. Hence, the complaint.
8. In the pre-summoning evidence on 17.07.2015, affidavit by way of evidence Ex.CW1/1 was filed by the complainant. In his affidavit of evidence Ex.CW1/1, the complainant reiterated all the averments made in his complaint and relied on documents Ex, CW1/A to Ex. CW1/I. S.No Documents Exhibit/mark 1 Board Resolution dated Ex. CW1/A 20.04.2015 2 MOU dated 09.09.2011 Ex. CW1/B 3 Final receipt dated 16.10.2012 Ex. CW1/C 4 Agreement for buy-back of plot Ex. CW1/D dated 19.11.2012.
5 Original Cheque bearing no. Ex. CW1/E 107882 dated 01.06.2015.
6 Cheque return memo dated Ex. CW1/F 02.06.2015.
7 Legal notice dated 18.06.2015 Ex. CW1/G 8 Speed posts and courier receipts Ex. CW1/H 9 Tracking report Ex. CW1/I
9. After closure of pre-summoning evidence, since sufficient material was found against the accused, summoning order was passed against the CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 5/27 accused vide order dated 17.07.2015.
10. Accused appeared pursuant to issuance of summons and notice U/s 251 Cr. PC was served upon the accused vide order dated 15.10.2015 to which the accused pleaded not guilty and claimed trial. During framing of notice, accused stated in his defence that he has no liability towards the complainant. The cheque in question was given as security to the complainant in lieu of buy back agreement with the customer. The complainant is the channel partner of his proprietorship concern. He did not receive the legal notice. He has no legal liability to pay the cheque amount to the complainant.
11. Thereafter, upon application of accused U/s 145 (2) N I Act to cross examine complainant and her witnesses, the same was allowed vide order dated 05.02.2016 and the accused was given an opportunity to cross examine the complainant and his witnesses.
12. Complainant examined Sh.B.P.Bansal, Director/AR of the complainant company as CW-1 in his post summoning complainant evidence along with CW-2 Prahlad Bisht and they were duly cross examined by Sh. Prashant Agnihotri, counsel for accused. Complainant also examined CW-3 Laxmi Kant, Manager, Axis Bank and CW-4 Ms. Babita Pandey, Officer in Punjab National Bank. Thereafter, on the statement of AR for complainant, CE was closed vide order dated 28.02.2017.
13. Thereafter, the plea of the accused Ashwani Prasad u/s 313 r/w 281 CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 6/27 Cr.P.C. was recorded vide order dated 16.03.2017, wherein, all material existing on record including the exhibited documents were put to accused wherein he admitted that Ex. CW1/B was executed between him and the complainant and he had agreed to pay commission to the complainant whenever full payment will be received from the third party. He denied Ex. CW1/C stating that no payment was made by one Mr. Prahlad Bisht to him and that he did not issue any receipt to him. He further stated that the cheque in question was given as a blank signed cheque as security. He further denied the document Ex.CW1/D stating that he has no knowledge about the same. He added that the complainant never informed him regarding presentation of cheques and therefore, he never gave any assurance of encashment to the complainant. He further stated that he did not receive any legal notice from the complainant. He further stated that he has no legal liability to pay the cheque amount to the complainant. The rate of Rs. 2800 per sq yards i.e. Rs. 2,80,000/- per plot (for plot measuring 100 sq. yds.) was fixed between him and complainant as per MOU dated 09.09.2011 Ex. CW1/B. But he has not received the said rate from the complainant. The registry for Sh. Prahlad Bisht was done in good faith but till date no payment has been received qua him for the same. As he has not received any payment, therefore, he has given written intimation to the Registrar office at Mathura for cancellation of the deal/registry. He has not received quarterly or yearly payment from the complainant as per the terms of MOU dated 09.09.2011 Ex. CW1/B.
14. Accused further expressed his desire to lead defence evidence.
Thereafter, matter was listed for DE and accused examined DW-1 Sh. Naveen Kumar Tyagi, Assistant Vice President, Axis Bank. Accused CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 7/27 also examined DW-2 Sh. R.P.Aggarwal and himself as DW4 and they were duly cross examined by Sh. Rajeev Aggarwal, counsel for complainant. Thereafter, DE was closed vide order dated 02.09.2019 at request of the accused and matter was fixed for final arguments.
15. Final arguments advanced by both parties have been heard. Written submissions filed by both the parties have been considered. Complainant has relied upon following judgments in support of his written arguments which are :- (1) Jugesh Sehgal Vs Shamsher Singh Gogi, (2009) 14 SCC 683, (2) Aparna A. Shah v M/S Sheth Developer P.Ltd & Anr, (2013) 8 SCC 71 , (3) CC Alavi Haji Vs. Palapetty Muhammed & Anr. (2007) 6 SCC 555, (4) Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197, (5) Purushottamdas Gandhi Vs Manohar Deshmukh 2007 (1) Mh. L.J.210, (6) Ravi Chopra vs State 2008 (2) JCC (NI) 169 , (7) Jammu and Kashmir Bank Vs Abhishek Mittal 2012 (1) DCR 189, (8) Rangappa Vs Sri Mohan (2010) 11 SCC 441, Mainuddin Abdul Sattar Shaikh vs Vijay D Savli AIR 2015 SC 2579. Accused has also relied upon certain judgments i.e. :- (1) P.J.Agro Tech. Ltd Vs Water Base Ltd AIR 2010 SC 2596, (2) Hiten P. Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16 , (3) Rangappa Vs Sri Mohan (2010) 11 SCC 441, (4) Basalingappa vs. Mudibasappa (2019) 5 SCC 418, (4) Bir Singh v. Mukesh Kumar, (2019) 4 SCC 19, (5) Devender Kumar VS Khem Chand dated 06.10.2015, Delhi High Court Crl. Rev. P. 679/2012 (6) Kulvinder Singh V. Kafeel Ahmed 2014 (2) JCC (NI) 100. Case file has been perused meticulously.
16. Before dwelling into the facts of the present case, it would be apposite to discuss the legal standards required to be met by both sides.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 8/27 In order to establish the offence under Section 138 of NI Act, the prosecution must fulfill all the essential ingredients of the offence. Perusal of the bare provision reveals the following necessary ingredients of the offence:-
First Ingredient: The cheque was drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity;
Second Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability;
Third Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank;
Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of cheque from the bank;
Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
17. The accused can only be held guilty of the offence under Section 138 NI Act if the above-mentioned ingredients are proved by the complainant co-extensively. Additionally, the conditions stipulated under Section 142 NI Act have to be fulfilled as has been observed by the hon'ble Apex Court in Jugesh Sehgal Vs Shamsher Singh Gogi, (2009) CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 9/27 14 SCC 683; Mainuddin Abdul Sattar Shaikh vs Vijay D Savli AIR 2015 SC 2579; & Aparna A. Shah v M/S Sheth Developer P.Ltd & Anr, (2013) 8 SCC 71 (as has also been relied upon by the complainant).
18. The proof of first and third ingredient is not disputed. The complainant has proved the original cheque that is Ex. CW-1/E dated 01.06.2015 which the accused has not disputed. The accused has admitted the issuance of cheque in his reply against notice under Section 251 Cr.PC dated 15.10.2015. It is not disputed that the cheque in question was presented within its respective validity period. The cheque in question was returned unpaid vide return memo Ex. CW-1/F dated 02.06.2015 due to the reason, "Funds insufficient". Complainant summoned bank witness CW-3 and CW-4 who both brought summoned record Ex. CW3/B (colly) and Ex. CW4/B respectively i.e. bank account details of the complainant and the accused respectively whereby the record proves that the said cheque was drawn by the accused on his account and the same got dishonoured due to insufficiency of funds in the account of the accused. As such, on the basis of the above, the first and third ingredient of the offence under Section 138 NI Act stand proved against the accused.
19. Accused in his reply during framing of notice u/s 251 Cr. P.C stated that he did not receive the legal notice Ex. CW1/G. The complainant has filed copy of legal notice Ex. CW1/G dated 18.06.2015, speed post and courier receipts are Ex. CW1/H and copy of tracking report is Ex. CW1/I on record.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 10/27
20. Section 114 of Evidence Act, 1872 is applicable to communications sent by post and it enables the court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the General Clauses Act envisages that when a registered notice is posted, it is presumed to have been served unless rebuttal is given. In the present case, no evidence in rebuttal has been led by the accused.
21. In CC Alavi Haji Vs. Palapetty Muhammed & Anr. (2007) 6 SCC 555 which has also been relied upon by the complainant, the Hon'ble Apex Court has held -
"Any drawer who claims 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 u/s. 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 with 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 u/s. 138 of the Act, cannot obviously contend that there was no proper service of notice as required u/s. 138, by ignoring statutory presumption to the contrary u/s. 27 of the General Clauses Act and Section 114 of the Evidence Act".
22. Further, in the present case, accused has not disputed his address as provided in the memo of parties by the complainant and it is the same address as he has himself provided to be his residential address in the bail bonds that have been furnished by him. Thus, in view of the above said dictum of the Hon'ble Apex Court and above discussion, this court holds that the legal notice Ex. CW-1/G dated 18.06.2015 was served on the CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 11/27 accused.
23. Further, the fact that the payment was not made by the accused within 15 days of the receipt of the legal notice is also not disputed. Therefore, even fourth and fifth ingredient stands proved against the accused.
24. As far as the proof of second ingredient is concerned, the complainant has to prove that the cheque in question was drawn by the drawer for discharging a "legally enforceable debt". In the present case, the signature of the accused on the cheque in question is not denied. The accused never denied that he is not the signatory to the cheque in question in his reply to notice under Section 251 Cr.P.C. and also in his statement recorded under Section 313 Cr.PC. Under the NI Act, once the accused admits the signature on the cheque, certain presumptions are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. The second presumption is contained under Section 139 of NI Act. The provision lays down the presumption that the holder of the cheque received it for the discharge, in whole or part, of any debt or other liability.
25. The combined effect of these two provisions is a presumption that the cheques was drawn for consideration and given by the accused for the discharge of debt or other liability. Both the sections use the expression "shall", which makes it imperative for the court to raise the presumptions, once the foundational facts required for the same are proved {Refer CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 12/27 Hiten P. Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16 as has been relied upon by the accused in his final arguments}.
26. Further, it has been held by a three-judge bench of the Hon'ble Apex Court in the case of Rangappa vs. Sri Mohan (2010) 11 SCC 441 that the presumption contemplated under Section 139 of NI Act includes the presumption of existence of a legally enforceable debt. Once the presumption is raised, it is for the accused to rebut the same by establishing a probable defence. The same has also been relied upon by both the parties in their final arguments.
27. The principles pertaining to the presumptions and the onus of proof were recently summarized by the Hon'ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5 SCC 418 (as has also been relied upon by the accused in his final arguments) as under:
"25. We having noticed the ratio laid down by this Court in the above cases on Section 118(a) and 139, we now summarise the principles enumerated by this Court in the following manner:
25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 13/27 25.4. That it is not necessary for the accused to come in the witness box in support of his defence. Section 139 imposed an evidentiary burden and not a persuasive burden. 25.5. It is not necessary for the accused to come in the witness box to support his defence."
28. The presumptions raised under Section 118(b) and Section 139 NI Act are rebuttable presumptions. A reverse onus is cast on the accused, who has to establish a probable defence on the standard of preponderance of probabilities to prove that either there was no legally enforceable debt or other liability. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon (refer M.S. Narayana Menon v. State of Kerala, (2006) 6 SCC 39).
29. The Hon'ble Supreme Court in the case of Kumar Exports v. Sharma Carpets (2009) 2 SCC 513, has observed that:
"...a presumption will have to be made that every negotiable instrument was made or drawn for consideration and that it was executed for discharge of debt or liability once the execution of the negotiable instrument is either proved or admitted... The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and discharge of any debt or liability. A presumption is not in itself evidence but only makes a prima facie case for a party for whose benefit it exists... in a trial under Section 138 of the Act the accused has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed... The accused may 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.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 14/27 However, the Court need not insist in every case that the accused should disprove the non-existence of consideration and that by leading direct evidence because the existence of negative evidence is entirely possible nor contemplated... To disprove the presumption the accused should bring on record such facts and circumstances, upon consideration of which the Court may either believe that the consideration and debt did not exist, or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on the complainant..."
30. Reference can also be taken from the decision of the Hon'ble Supreme Court from the case of Bharat Barrel & Drum Manufacturing Company vs. Amin Chand Pyarelal 1999 (3) SCC 35, wherein it has held the following:
"... If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument..."
Defence raised by accused :- Security cheque and No legal liability towards the complainant
31. It is the case of the accused that he entered into an Agreement with the complainant wherein he had appointed the complainant as his channel partner. However, the complainant was not authorized to enter into any CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 15/27 buy-back or other agreement with the buyers vis-à-vis the plots in question and that the buyers have also not paid full consideration in terms of the contract. Further, he has taken a defence that the complainant has taken less consideration than the fixed minimum rate as per the agreement and therefore, the documents that have been relied upon by the complainant are false and fabricated. Lastly that he handed over blank signed cheques to the complainant only for securing the buyers in order to ensure the selling of his plots based upon such assurance.
32. On the contrary, it is the case of the complainant that the accused has issued final receipt to each buyer thereby acknowledging full payment of consideration amount and further that the complainant entered into a buy back agreement with the accused wherein the accused gave the cheque in question to the complainant as security, based on which the complainant further entered into another buy back agreement with the investors/ buyers wherein he issued post-dated cheques (herein after as PDCs) to the buyers upon assurance from the accused.
33. Complainant has examined CW-2/buyer Mr. Prahalad Bisht in his support. The witness stated inter alia that he did not have knowledge about the terms of agreement between the accused and the complainant. The witness stated in his examination in chief that he paid a sum of Rs. 6.34 lacs as total consideration which was paid by him to the complainant via two cheques of Rs. 3 lacs and Rs. 3.34 lacs respectively, for a surplus investment for a period of 3 years in 2012 and he was supposed to receive a return of Rs. 7 lacs in 2015 for the same which was assured to him by the complainant. Further, he categorically stated that he has not CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 16/27 received the return till date and that he had entered into a sale deed with the accused regarding the said plot in the year 2012. He further clarified in his cross examination that he had invested in the plot of size 247 sq. yards.
34. It is pertinent to mention here that the complainant has placed on record buy-back agreement that was entered into between him and the accused, Ex. CW1/D dated 19.11.2012. The same has not been admitted by the accused and no question was put to him by the complainant in his cross examination as DW-4. Further, the complainant has only averred and not placed on record any back to back buy-back agreement that he allegedly entered with the buyer/CW-2. Interestingly, CW-1 has mentioned Ex. CW1/D as the buy back agreement that was executed between him and the buyer CW-2 dated 19.11.2019 in his evidence by way of affidavit, Ex. CW1/1.The same is in stark contradiction of the document and the content of his complaint.
35. Further, perusal of terms of agreement between complainant and the accused Ex. CW1/B dated 09.09.2011 shows that the complainant had agreed to work as channel partner for the accused wherein he was authorized to book the plots as per the layout plan, collect booking amount, further payments from the customers, issue receipts to the customer on behalf of accused and pass on the payments received to the accuse. The accused had agreed to give any surplus over the minimum predetermined rate of the plot to the complainant as remuneration, and further that the complainant was entitled to get commission, in case the buyer/ investor paid the consideration directly to the accused.
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36. The court finds merit in the defence taken by the accused that the complainant was not authorized to bring investors for any assured return or thereafter to enter into a buy-back agreement with the third party on his behalf. Complainant has not placed on record any proof of making payment of the said return to the buyers i.e. CW-2, even if, for argument sake, the version of the complainant to the effect of commitment of assured return by the accused to the buyer after three years of payment of consideration is believed to be true. Further, CW-2 has specifically denied receiving of any returns till date. Also, the though the complainant has relied upon Ex. CW1/D, he has failed to prove it as per law and also the circumstances around which the said document was allegedly executed as he has failed to place on record the buy-back agreement that he alleges to have entered into with CW-2, based on which he issued PDCs to him.
37. Further, even if this version of the complainant and the document are to be believed, the factum of non-payment of any return to the investor/buyer is not in dispute. Further, documentary evidence takes precedence over oral agreement as to terms of a document in view of section 91 & 92 of the Indian Evidence Act. The complainant stated in his cross-examination that the terms of the agreement were mutually changed to make it a commission agent business and not a buyer agreement for which the commission was at a mutually agreed rate. Keeping in view the four contours of law around documentary evidence and the present factual matrix, in absence of specific term in the Agreement Ex. CW1/B as to authorization of the complainant to enter into buy-back agreement with the third party or change in the nature of CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 18/27 their professional relationship, his oral argument that it was decided between him and the accused for the said arrangement cannot be entertained.
38. Further, the accused has denied issuance of final receipt Ex.
CW1/C dated 16.10.2012. Perusal of the document shows that though the total amount of consideration has been acknowledged to have been received from CW-2 under the stamp and seal of the accused, it only authorizes the buyer/investor to get the sale deed registered at their own cost and is silent on the aspect of return or buy-back. Therefore, even if this document is taken as true and proved, the same doesn't come to the rescue of the complainant as it is not in line with the case setup by the complainant.
39. This court also finds merit in the argument of the accused that the pre-determined minimum rate for 100 sq yards of plot was Rs. 2,880/- per sq yard but the final receipt allegedly issued by the accused is that of Rs. 6,34,790/- for 247 sq. yards of plot which is lower than the agreed rate between the accused and complainant of Rs.7,11,360. Since it is against the terms of the agreement admitted by both the parties, the burden of proving the same lied upon the complainant to prove the circumstances which led to making of the sale at a lower than fixed rate which the complainant has failed to explain in terms of the provisions of the Indian Evidence Act.
40. Further, Ex. DW1/A does not have any bearing on the case since it pertains to old banking transactions between the accused and the CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 19/27 complainant for the year 2013 and reliance has been placed on it by the accused only to impeach the credibility of the complainant by showing his contradictory conduct. Further, the complainant has concealed the factum of entering into a supplementary Memorandum of Understanding dated 23.01.2012 for development and sale of a new block at a new rate of Rs. 3200 per sq. yard which the accused has placed on record, Ex DW4/1.
41. Accused has also placed reliance on Ex. DW4/2 which is the printout of an e-mail that was sent by the complainant to a few of the buyers wherein he specifically stated that he was only an agent of the complainant and was in no way responsible for payment of returns or refund and also it was not for him to get the sale deed registered in the name of the allotees as he has already transferred full consideration that was paid to him by the buyers to the account of the accused. The same has not been denied by the complainant and no questions were put to the accused on this point. Therefore, it is clear from the content of the email that complainant has not made payment of assured return to the buyer on behalf of the accused.
42. Further, it has been admitted by the complainant in his cross-
examination that the accused showed him a copy of the sale deed that was registered between the accused and CW-2. The accused has placed on record a copy of sale deed, Mark X2 dated 31.10.2012. It has been argued by the accused that since a sale deed was executed between accused and buyer in October, it is highly improbable for the buyer to have entered into a buy-back agreement with the complainant instead.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 20/27 The court finds weight in this argument of the accused as the existence of a back to back buy-back agreement entered into between complainant and the accused dated 19.11.2012 on one hand, which is after the registration of the said sale deed; and complainant and buyer on the other hand seems improbable and unreasonable, keeping in view that the accused and buyer were directly connected and could have entered into a buy-back agreement directly as the sale deed was duly executed between them and that the said buy-back agreement was allegedly entered after execution of the sale deed. Therefore, it seems that the complainant has hatched a concocted story that is very improbable and unreasonable.
43. In Sripati Singh v. State of Jharkhand, 2021 SCC OnLine SC 1002, the Apex Court held that:
"When a cheque is issued even though as 'security' the consequence flowing therefrom is also known to the drawer of the cheque and in the circumstance stated above if the cheque is presented and dishonoured, the holder of the cheque/drawee would have the option of initiating the civil proceedings for recovery or the criminal proceedings for punishment in the fact situation, but in any event, it is not for the drawer of the cheque to dictate terms with regard to the nature of litigation."
44. In view of the above dictum, it can be stated that a cheque which has allegedly been issued by the accused as a security to the loan would not per se be out of the ambit of section 138 of the Act. The important consideration is the fact as to whether the said cheque has been issued in discharge of a debt or other liability or not i.e. whether any legally enforceable debt existed on the date when the cheque was issued.
CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 21/27
45. The accused has taken a consistent line of defence that he issued the cheque in question as blank signed security cheque only to assure the buyers in order to attract capital. The complainant did not make any payment on behalf of the accused or under his authority for which the accused needed to compensate. Complainant has merely averred that he issued PDCs to the investors in terms of the buy-back but it is clear from testimony of his own witness CW-2 that no payment was made to him by the complainant and therefore, liability of the accused to repay the same to the complainant does not come into play.
46. Even if the accused had given the said cheques to the complainant as security in order to secure the capital from the proposed buyers, the said liability did not arise on the date of issuance of cheque since the complainant did not fulfill his part of the obligation, even if this version of the complainant is believed to be true.
47. The same is supported by testimony of DW-2, Mr. R.P.Aggarwal who stated that he invested money in the project after he was shown and assured by the complainant that he had multiple blank signed cheques of the accused in case anything turns south. The same were shown to him in the beginning of the year 2012, based on which he also convinced few of his relatives to invest in the project and the complainant has not been able to rebut the witness on this point. It is pertinent to mention here that the same is in stark contradiction as to the time of receiving of the cheque as alleged by the complainant to be at the time of the alleged buy back agreement between accused and the complainant dated 19.11.2012. Therefore, the complainant has miserably failed to prove the existence of CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 22/27 the circumstances wherein the accused owed him any liability to pay for the cheques issued by him.
48. Further, considering the overall facts and circumstances of the case, at best, the investors or buyers can file a civil suit for recovery of consideration amount or possession of the said plot from the accused. This court is not a Civil Court to dwell upon these issues. However, even in this scenario, the complainant doesn't have any locus against the accused as he did not incur any actual expenditure on behalf of accused in terms of payment of assured return. The accused has placed reliance on P.J.Agro Tech. Ltd Vs Water Base Ltd AIR 2010 SC 2596 on this point wherein the Hon'ble Apex court held as under:
"9. In the instant case, the cheque which had been dishonoured may have been issued by the Respondent No.11 for discharging the dues of the Appellant No.1 Company and its Directors to the Respondent No.1 Company and the Respondent Company may have a good case against the Appellant No.1 Company for recovery of its dues before other fora, but it would not be sufficient to attract the provisions of Section 138 of the 1881 Act. The Appellant Company and its Directors cannot be made liable under Section 138 of the 1881 Act for a default committed by the Respondent No.11. An action in respect of a criminal or a quasi-criminal provision has to be strictly construed in keeping with the provisions alleged to have been violated. The proceedings in such matters are in personam and cannot be used to foist an offence on some other person, who under the statute was not liable for the commission of such offence."
49. It is also pertinent to mention here that the complainant has not filed the present complaint against the accused for recovery of any CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 23/27 commission that might have been due upon the accused to pay to the complainant in terms of the agreement. It is also clear from bare perusal of the complaint that he has reserved his right to take appropriate legal action against the accused for arrears of commission that is due upon the accused. Also, the complainant can move the appropriate forum for legal action against the accused for failure to perform as per agreement but the complainant is not entitled for relief under NI Act in the present factual matrix.
50. Further, the accused has relied upon Kulvinder Singh V. Kafeel Ahmed 2014 (2) JCC (NI) 100 on the point of solvency of the complainant to advance the said money but the same is irrelevant to the case at hand as it has already been discussed above that the complainant has failed to prove the factum of payment made by him to the buyer on behalf of the accused and therefore the question of solvency of the complainant does not arise.
51. The last line of defence that has been taken by the accused is that he issued blank cheques to the complainant that were not filled by him. This argument alone doesn't have a bearing on the case of the complainant since even if a blank signed cheque is given by the accused to the complainant and he fails to rebut the presumption against him, he would be liable under the contours of the NI Act as has been held by the Hon'ble Supreme Court in Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197, which has also been relied upon by both the accused and the complainant wherein it was observed as under:
"33. A meaningful reading of the provisions of CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 24/27 the NegotiableInstruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted...36. Even a blank cheque leaf, voluntarily signed and handed over by the accused, which is towards 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."
52. The complainant has also relied upon Purushottamdas Gandhi Vs Manohar Deshmukh 2007 (1) Mh. L.J.210; Ravi Chopra vs State 2008(2) JCC (NI) 169; & Jammu and Kashmir Bank Vs Abhishek Mittal 2012 (1) DCR 189 in his support. However, since the accused has otherwise been able to raise a probable defence and as the accused has been able to shake the veracity of the complainant, this alone cannot come to the rescue of the complainant in order to prevent his case from falling in light of other circumstances of the case.
53. A statutory presumption has an evidentiary value. The question as whether the presumption stood rebutted or not, must, therefore, determined keeping in view the other evidence on record. In case of this nature, where the chances of false implication cannot be ruled out the background fact and the conduct of the parties together with the legal requirements are required to be taken into consideration. The Hon'ble Supreme Court in the case of Krishna Janardhan Bhat v. Dattaraya G. CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 25/27 Hegde (2008) 4 SCC 54 had observed that, "45. We are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the courts shall put a blind eye to the ground realities. Statute mandates raising of presumption, but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balanced. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same."
54. It must be kept in mind that the burden on the accused to prove his defence is not very high. The defence needs to be proved by only a preponderance of probability. This can be done either by proving his defence by adducing cogent evidence or by destroying the case of the complainant by pointing out loopholes in the complaint or by means of cross examination.
55. It is also pertinent to mention here that the accused has taken a consistent stand and stood firm on his defence throughout the trial, barring some minor contradictions, from the stage of framing of notice to examining himself as witness and also in his application u/s 142(2) of NI Act and his statement that was recorded u/s 313 Cr.P.C. Needless to state that the case of the complainant has to stand on its own legs and not CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 26/27 dependent upon the lacunae or contradictions in the defence of the accused, once he has been able to raise a probable defence.
CONCLUSION
56. Therefore, in any possible and reasonable circumstance, as stipulated above, there did not existed any legal liability of the accused to pay the complainant as to the cheque amount, on the date of presentation of the cheque in question and the accused has been able to raise a probable defence. In view of the above discussions and reasons, in the opinion of this Court, the presumptions arising in favor of the complainant U/s 118 & 139 of the Act have been rebutted by the accused by proving his defence, whereas the complainant has failed to prove his case beyond all reasonable doubts. Resultantly, this court finds the accused Ashwani Prasad not guilty for the punishable U/s 138 N I Act. Hence, he stands acquitted.
57. Further, accused is directed to furnish bail bond and surety bond in the sum of Rs. 50,000/- U/s 437(A) Cr.P.C. and is directed to be present before the Ld Appellate Court as and when notice is served upon him.
Announced in the open court on 13.09.2022.
(ABHILASHA SINGH) Metropolitan Magistrate-02/NI Act/South Saket Court/New Delhi/13.09.2022 Certified that this judgment contains 27 pages and each page bears my signature.
(ABHILASHA SINGH) Metropolitan Magistrate-02/NI Act/South Saket Court/New Delhi/13.09.2022 CC NO. 465045/2016 , OLD NO. 959/2015 M/S B.P.CONSULTANTS VS ASHWANI PRASAD PAGE NO. 27/27