Delhi District Court
M/S Protect Securities Private Limited vs Prem Singh on 29 November, 2024
:: 1 ::
DLST020198692018
Registered on : 04.07.2018
Presented on : 04.07.2018
Decided on : 29.11.2024
Decision : Acquitted
IN THE COURT OF
JUDICIAL MAGISTRATE FIRST CLASS(NI ACT)-08
SOUTH, SAKET DISTRICT COURT, DELHI
(PRESIDED OVER BY SH. KOMAL)
CT Cases 9005/2018
CNR NO. DLST-02-019869-2018
JUDGMENT
M/s Protect Securities Pvt. Ltd.
Having registered Office at:
LIG 1, LGF, Gayatri Enclave, Near RPS Colony, Khanpur T Point, New Delhi, Through its Director, Sh. Vinod Aggarwal. ..........Complainant.
VERSUS Prem Singh, S/o Sh. Ganesh, R/o C- 1st , 964, Madangir, Dr. Ambedkar Nagar, New Delhi-110062. ..........Accused.
Digitally signed by komal komal Date:
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Offence punishable under section 138 of Negotiable Instruments Act, 1881 FACTUAL MATRIX:
1. The instant proceedings have originated out of a complaint filed by the complainant company through its Director Mr. Vinod Aggarwal who is authorised to appear and contest the present complaint on behalf of the complainant company i.e. M/s Protect Securities Private Limited against the accused for the offense under Section 138, Negotiable Instruments Act, 1881 (hereinafter referred to as "NI Act"). Before going further, it is necessary to dwell upon the brief facts of the case.
2. Briefly stated, the case of the complainant is that the complainant is a Private Limited Company registered with the office of the Registrar of the companies under relevant provision of the companies Act and having its registered office at LIG 1, LGF, Gayatri Enclave, Khanpur T Point, New Delhi and dealing in the business of providing different types of loan to the customers. The accused approached the complainant company on 18.04.2017 for getting the personal loan of Rs.2 lacs for a period of 24 months. The loan of Rs.2 lacs was advanced to the accused by the complainant company vide cheque bearing no. 823917 dated 18.04.2017 subject to the condition to repay the said loan amount in 24 equal monthly installments from 18.05.2017 to 18.04.2019 @ Rs.13,333/- per month and the accused executed a loan agreement dated 18.04.2017 along-with a receipt dated 18.04.2017 and a demand promissory note dated 18.04.2017 of the value received in favour of the complainant. Accused had Digitally signed by komal komal Date:
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agreed to repay the EMI in stipulated period as per terms and conditions of the said agreement. However, the accused had failed to pay the monthly installments despite repeated requests and reminders of the complainant. Thereafter, the complainant issued a notice dated 20.03.2018 to the accused regarding termination/recall of the loan agreement, and requested to pay entire outstanding/dues amount on account of initial loan amount, interest, penalty, damages etc. till the date of notice. The acccused aftere receiving the aforesaid notice approached the complainant and admitted his liability and acknowledged to the aforesaid outstanding due and issued a cheque bearing no.190785 dated 16.04.2018 for a sum of Rs.2,91,763/- drawn on Union Bank of India, Safdarjung Development Branch, Delh (hereinafter referred as 'cheques in question') in order to discharge of partial liability in favour of complainant and promised to honor the cheque upon presented.
3. Thereafter, the complainant presented the cheque in question to his banker for encashment, however, the same was dishonoured due to reason "Insufficient Funds" vide its return memo dated 19.04.2018.
4. Thereafter, the complainant through its counsel served Legal Demand Notice dated 18.05.2018 to the accused by way of Speed Post and Courier instructing the accused to make the payment of Rs.2,91,763/- in lieu of the dishonored cheque. The legal notice was duly served to the accused, however, the accused has neither complied with the legal notice nor gave reply to the Digitally same. signed by komal komal Date:
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5. Aggrieved by the non-receipt of the payment within the stipulated period of 15 days, the complainant was constrained to file the present complaint case.
APPEARANCE OF ACCUSED AND TRIAL:
6. After institution of the present case, summons were issued to the accused vide order dated 04.07.2018. The accused appeared before the Court on 17.12.2018 in response to the bailable warrants and was admitted to bail subject to furnishing of personal bond in the sum of Rs.20,000/- with one surety of like amount.
7. Notice u/s 251 Cr.P.C for the offence of Section 138 NI Act was served upon accused. He pleaded not guilty and claimed trial. In his reply to the notice u/s 251 Cr.PC, inter-alia, he stated that he had taken loan of Rs.4 lacs from the complainant in the year 2017 at interest 3% per month and at that time, the cheque in question in blank and signed condition was given to the complainant for security purpose. He further stated that he had repaid many installments to the complainant by way of bank transfers. He further stated that he is not aware as to whether he is liable to pay any remaining amount to the complainant or not.
He further admitted receiving of the legal notice sent on behalf of the complainant. He further pleaded that the cheques in question only bears his signatures and the particulars are not filled by him.
8. Given the nature of the allegations and reply of the accused u/s 251 CrPC, this Court directed that the case shall be tried as a Summons case under Chapter XX of Cr.P.C. Digitally signed by komal komal Date:
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9. As the statement of defense of accused revealed specific defense, oral request made on behalf of the accused was allowed to cross examine the complainant's witness under section 145(2) NI Act. Thereafter, the matter was fixed for CE.
EVIDENCE LED BY THE COMPLAINANT:
10. The complainant, in support of its case, has placed on record affidavit of its Director, Sh. Vinod Aggarwal, in evidence vide Ex. CW1/1 and relied upon the following documents:
Sl. No. Exhibits/Mark Details of Documents
1. Ex.CW1/A Resolution dated 02.09.2015 in favour of Mr. Vinod Aggarwal;
2. Ex.CW1/B Loan Agreement along-with Receipt and promissory note dated 18.04.2017;
3. Ex.CW1/C Loan Recall notice dated 20.03.2018;
4. Ex.CW1/D Cheque in question;
5. Ex.CW1/E Bank Return memo dt.19.04.2018;
6. Ex.CW1/F Legal demand notice dt.
18.05.2018;
7. Ex.CW1/G Postal receipt dated 18.05.2018;
8. Ex.CW1/H Tracking report.
11. After examination-in-chief of CW-1, he was duly cross examined by the learned counsel for the accused. During cross- examination, CW-1 produced Certificate of Registration dated 14.10.2019 bearing Mark-A, loan ledger account dated Digitally signed by komal CT Case No.:- 9005/2018 Page No. 5 of 12 komal Date:
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18.04.2017 bearing Mark-B, loan ledger account dated 04.05.2017 bearing Mark-C, ITR of the complainant firm for the F.Y. 2018-19 bearing Mark-D and ITR of the complainant firm for the F.Y. 2019-20 bearing Mark-E . CW-1 further admitted to have received 3 EMIs of Rs.13,333/- totaling to Rs.39,999/- out of the total 24 EMIs. CW-1 further produced the following documents:
1. MarkCW1/D1 Copy of RBI Certificate.
2. MarkCW1/D2 Copy of Company Data.
3. MarkCW1/D3 Counter foil of the cheque books.
4. MarkCW1/D4 Copy of bank statement.
12. After due cross-examination, CW-1 was discharged and CE was closed. Thereafter, the matter was fixed for recording statement of the accused u/S 313 Cr.P.C. read with Section 281 Cr.P.C.
13. The statement of the accused under Section 313 Cr.P.C.
read with Section 281 Cr.P.C. was recorded whereby circumstances appearing against him in evidence were put to him. He took the defence that the complainant is demanding interest over and above the agreed amount and is misusing his security cheques despite the repayment of the entire loan amount.
EVIDENCE LED BY THE ACCUSED:
14. Accused, in support of his case, examined himself as defence witness and his testimony was recorded as DW-1. In his examination-in-chief, he tendered his evidence by way of affidavit bearing Ex.DW1/A. He further relied upon documents Digitally signed by komal komal Date:
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which are Mark.DW1/1 is the Copy of mediation order dated 03.05.2019, Mark.DW1/2 is the Copy of handwritten statement of payment, Mark.DW1/3 is the Copy of bank statement, Mark.DW1/4 is the Copy of cheque leaf, Mark.DW1/5 is the Copy of statement of complainant as CW-1 dated 02.06.2022 and Mark.DW1/6 is the Copy of Company Master Data.
15. The defence witness DW-1 was duly cross-examined by the ld. Counsel of the complainant and was discharged. Thereafter, evidence on behalf of the accused was closed.
16. Thereafter, the matter was fixed for final arguments.
ARGUMENTS -
17. Final arguments were advanced on behalf of both the parties. Rival submissions were heard on behalf of both the parties.
18. The following points of determination arise in the present case:
a. Whether the complainant is successful in raising the presumptions under Section 118 read with Section 139 of NI Act?
b. If yes, whether the accused has been successful in raising a probable defence?
THE LAW APPLICABLE: Digitally
signed by
komal
komal Date:
2024.11.29
18:38:06
+0530
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19. I have given my thoughtful consideration to the rival submissions of the Ld. counsels from both sides and have also perused the record. Before appreciation of evidence led on behalf of the parties, at the very outset, I would like to narrate the legal principles relevant for adjudication of complaint under Section 138 of NI Act.
20. The Hon'ble Supreme Court of India in Basalingappa v. Mudibasappa, 2019 SCC OnLine SC 491 at page 422 held as follows :
(i) 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.
(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or 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.
(iv) 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.
21. The three-judge bench of the Hon'ble Supreme Court in Rangappa v. S. Mohan, (2010) 11 SCC 441 has ruled that existence of liability itself is a presumption of law. It held as under:
"26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability." Digitally signed by komal komal Date:
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22. The Hon'ble Supreme Court of India in C.C. Alavi Haji v. Palapetty Muhammed, (2007) 3 SCC (Cri) 236 at page 565 held as follows:
"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 GC Act and Section 114 of the Evidence Act."
APPRECIATION OF EVIDENCE AND FINDINGS POINT OF DETERMINATION NO. 1:
23. In this case issuance of cheque, its presentation and dishonorment is not in dispute, inasmuch as the same have been duly proved on the basis of cogent evidence.
24. The signature on the cheque in question bearing Ex.CW1/D is admitted by the accused. The aforesaid cheque in question was returned vide return memo bearing Ex.CW1/E. The legal demand notice bearing Ex.CW1/F was sent to the accused vide postal receipt bearing Ex.CW1/G and internet generated tracking report bearing Ex.CW1/H. The internet generated tracking report stating 'item received' was filed as proof of dispatch and delivery of legal demand notice. The accused had accepted the receipt of legal demand notice.
25. In view of the abovementioned circumstances, the presumptions under sections 139 and 118 NI Act that the cheque in question was for a legally recoverable debt/liability stand activated. Digitally signed by komal komal Date:
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26. Accordingly, the point of determination no.1 is decided in affirmative.
POINT OF DETERMINATION NO. 2:
27. The burden to disprove the existence of legal liability is upon the accused. This may be done by poking holes in the case of the complainant or by leading positive evidence in defence.
28. As far as the defence evidence is concerned, the accused had examined himself as DW-1. It is stated by DW-1 that entire cheque amount is repaid, however, complainant had not withdrawn the cases. He had further relied on MarkDW1/1 that is mediation settlement between the parties. The settlement was declared null and void by Court through order dated 10.01.2020, in such circumstance this document cannot be relied upon. The accused had produced a record of payment MarkDW1/2 showing date, cheque number, and amount paid to complainant. The complainant had never suggested in cross-examination that amount of Rs.1,97,351/- is not paid to him, as mentioned on Point X. Further, accused had produced bank statement Ex.DW1/3 showing payment made to complainant, the said are never suggested as not received. Further, the same being a well maintained bank account statement, authenticity of bank statement is beyond question. In such an event, the fact of accused making constant payments to the complainant cannot be denied.
Digitally signed by komal komal Date:
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29. The director of complainant company had appeared as CW-1. The outstanding loan in present loan is stated to be Rs. 2 lacs. It is further stated that there are multiple litigations between the parties and accused had paid total of Rs.1,82,668/-. The complainant was confronted with bank statement MarkCW1/D4, it was never denied by complainant that he had received Rs. 8,50,000/- from accused. It was stated that the said amount of Rs. 8,50,000/- was received for other business transactions between the parties. The other business transactions between the parties is never disclosed, the total loan amount outstanding in all cases is not mentioned, and no documentation of said transactions is put on record. In such an event the burden of proof is on complainant to disclose other transactions with the accused, which he never proved. In such a circumstance, the statement of accused that payments of Rs.1,82,668/- and Rs.8,50,000/- is received by complainant can be relied upon.
30. The statement of accused is consistent in reply to notice u/s 251 Cr.P.C and statement u/s 313 Cr.P.C. The accused had proved paying installments by way of bank statement and cross- examination of CW-1. The burden of proof now lies on the complainant to disclose the outstanding dues of accused in which he has desperately failed.
31. Thus, by way of cross-examination of complainant and leading his defence, accused has been able to dilute the credibility of complainant's testimony and has been able to raise probable doubt over the averments of complainant.
Digitally signed by komal komal Date:
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32. Accordingly, in light of the aforesaid discussion, the point of determination no.2 is decided in affirmative.
Conclusion:
33. Therefore, in view of the above discussions and reasons, in the opinion of this Court, the presumptions arising in favour 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 Prem Singh not guilty for the punishable U/s 138 N I Act. Hence, he stands acquitted.
ANNOUNCED IN THE OPEN COURT Digitally signed
by komal
komal Date:
ON 29.11.2024. 2024.11.29
18:38:37
+0530
(KOMAL)
JMFC(NI Act)-08,South
Saket/NewDelhi/29.11.2024
Certified that this judgment contains 12 pages and each Digitally page bears my digital signature. signed by komal komal Date:
2024.11.29 18:38:41 +0530 (KOMAL) JMFC(NI Act)-08,South Saket/NewDelhi/29.11.2024 CT Case No.:- 9005/2018 Page No. 12 of 12 M/s Protect Securities Pvt. Ltd. Vs. Prem Singh