Delhi District Court
Cc No:3213/12 Smt. Jyoti Kalra vs Tushar Verma on 20 December, 2013
1
IN THE COURT OF SHRI JAGMOHAN SINGH,
MM(NI ACT)-08 DWARKA COURTS:NEW DELHI
CC NO:3213/12
Unique Case ID No: R0525732009
Smt. Jyoti Kalra,
W/o Sh. Aman Kalra,
R/o Flat No. 133, DIN Apartment,
Plot No.7, Sector-4, Dwarka, New Delhi ...............Complainant
Versus
Sh. Tushar Verma
S/o Late Sh. Paras Nath Verma,
R/oA-189/1 Gulab Bagh, Uttam Nagar, New Delhi .....................Accused
1. Name of the complainant : Smt. Jyoti Kalra
2. Name of the accused : Sh. Tushar Verma
3. Offence Complained of or proved : Under section 138 of Negotiable
Instruments Act, 1881
4. Plea of the Accused : Pleaded not guilty
5. Date of filing : 09.07.2009
6. Date of Institution : : 10.07.2009
7. Date of reserving judgment/order : 02.12.2013
8. Final Order/Judgment : Convicted
9. Date of pronouncement : 20.12.2013
CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma
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JUDGMENT
BRIEF FACTS AND REASONS FOR THE DECISION OF THE CASE:-
1. Vide this judgment, I shall dispose of the present complaint u/s 138 of the Negotiable Instruments Act (in short, NI Act) filed by the complainant against the accused.
2. The case of the complainant is that complainant started a business with accused Tushar Verma and one Sh. Satender Kumar Verma in the name and style of Dhanlaxmi Trading Company (Hereinafter referred to as the Firm) and executed a partnership deed on 30.08.2007. As per clause 13 of the partnership deed accused gave a verbal one month notice to its partners on 09.07.2008 seeking to retire from the Firm. On 22.08.2008 accounts were settled between the complainant and the above two partners and an agreement was executed in this regard. As per the agreement both the accused and Sh. Satinder Kumar Verma would pay a total amount of Rs. 5 lacs to the complainant on equally sharing basis i.e 2,50,000/- lacs each. In discharge of his debts/liability towards the complainant, accused issued two cheques bearing nos. 580588 dated 04.05.2009 drawn on ICICI Bank, Vishal Enclave Branch, New Delhi and cheque bearing no. 163294 dated 10.05.2009 drawn on The Nainital Bank Ltd, 17/5, AB Main Market Tilak Nagar, New Delhi in the sum of Rs. One lac in favour of the complainant. According to the complainant, the aforesaid cheques when presented for realisation, were received back dishonoured vide bank return memos dated 05.05.2009 and 12.05.2009 respectively with the remarks "Funds Insufficient". Consequentially, a legal notice dated 27.05.2009 was served by the complainant through her Counsel upon the accused vide Regd.
post and U.P.C receipts dated 28.05.2009 calling upon the accused to make the payment towards the cheque amount in question within 15 days of receipt of notice. According to the complainant, the said notice was duly served upon the CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 3 accused but no payment against the above dishonoured cheques have been made by the accused within the requisite period. Hence the present complaint.
3. The cognizance of offence under Section 138 of the Negotiable Instruments Act, 1881 was taken by the Ld. Predecessor Court and accused was summoned vide order dated 10.07.2009, upon which the accused appeared in Court and was admitted to bail. Thereafter, separate notice u/s 251 Cr.P.C. explaining accusations against the accused u/s 138 of the NI Act was framed on 06.02.2010 to which he did not plead guilty and claimed trial. Complainant got herself examined as CW1. Vide separate statement of Ld. Counsel for complainant CE stands closed on 15.04.2013. Statement of accused u/s 313 Cr.P.C. was recorded on 09.05.2013. An application filed on behalf of the accused u/s 315 Cr. P. C. seeking his examination as DW was allowed and the accused deposed as DW1. Vide separate statement of Ld. Counsel for accused, DE was closed on 19.09.2013.
4. Documents relied upon by the complainant are as follows:-(i) Ex. CW-1/A :
Agreement regarding settlement of accounts (ii) Ex. CW1/B1: Original Cheque no. 580588 dated 04.05.2009 for a sum of Rs. One lac drawn on ICICI Bank Ltd, Vishal Enclave Branch, New Delhi; (iii) Ex. CW1/B2: Original cheque bearing no. 163294 dated 10.05.2009 for a sum of Rs. One Lac drawn on The Nainital Bank Ltd, Tilak Nagar, New Delhi; (iv) Ex. CW-1/C1, Ex. CW1/C2 and Ex. CW1/C3: Original Cheque returning memos dated 05.05.2009, 12.05.2009 and 18.05.2009 respectively; (iv) Ex. CW-1/D Copy of Legal Notice dated 27.05.2009; (iv) Ex. CW-1/E1 and Ex. CW-1/E2-: Registered A.D and UPC Receipts (v) Ex. CW1/F: Registered envelope containing legal notice received back unserved by the complainant; and (vi) Ex.CW1/DA : Partnership Deed.
5. It is well settled position that to constitute an offence under S. 138 N.I. Act, the following ingredients are required to be fulfilled,- (i) a person must have drawn CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 4 a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account; (ii) The cheque should have been issued for the discharge, in whole or in part, of any debt or other liability; (iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier; (iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank; (v) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; (vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice.
6. Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the Act.
7. I have gone though the record and also heard both the parties. During his examination u/s 313 Cr.P.C. Accused admitted receipt of legal notice. Accordingly, the only question which arises for consideration of this Court is whether a legally recoverbale debt was in existence in favour of the complainant and agaisnt the accused on the date of the cheque in question. The same may now be considered.
8. Section 118 of the NI Act inter alia provides that it shall be presumed, until the contrary is proved, that every negotiable instrument was made or drawn for consideration. Section 139 of the NI Act stipulates that unless the contrary is proved, it shall be presumed, that the holder of the cheque received the CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 5 cheque , for the discharge of, whole or part of any debt or liability. The said presumptions are rebuttable in nature.
9. It has been held in M/s. Kumar Exports v. M/s. Sharma Carpets, 2009 A.I.R. (SC) 1518 that the accused may rebut these presumptions by leading direct evidence and in some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evidence adduced by the complainant during the trial. Further, the burden may be discharged by the accused by showing preponderance of probabilities and the onus on the accused is not as heavy as it is on the complainant to prove his case. Ld. Counsel for the accused also relied upon V.D. Jhangan Vs State of Uttar Pradesh AIR 1966 SC 1762, Vishnu Dutt Sharma Vs. Smt. Daya Sharma 2009 VII AD (S.C.) 721, Devan Vs. Krishna Menon 2010(4) Civil L.J. 462 (Ker) and Kali Ram Vs. State of Himachal Pradesh (1973) 2 SCC 808 in support of the legal preposition that burden on the accused to disprove the above presumptions is not as heavy as it is on the Complainant to prove its case.
10.The deposition of the Complainant in a nutshell is that she started a business in commodity trading in the month of August 2007 with the accused and another partner namely Satinder Kumar Verma in the name of Dhanlakshami Trading Company having its office at 1167, 2nd Floor, New Market, Kucha Mahajani, Chandani Chowk, Delhi - 06 and also at 102, First Floor, Building No. 2574/6, Bedonpura, Ajmal Khan Road, Karol Bagh, New Delhi - 05 and a Partnership Deed Exh. CW1/DA was executed between herself, the accused and above said Satinder Verma on 30.08.2007. That in terms of clause 13 of the above Parnership Deed, she gave the accused and the third partner Shri Satinder Kumar Verma a verbal one month notice on 09.07.2008 seeking retirement from the Partnership Firm and the other two partners accepted the said verbal notice and did not have any objection to it. That the accounts were settled CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 6 between the three partners on 22nd August, 2008 and an agreement Exh. CW1/A was executed between all the partners. That it was settled between them that the accused as well as Shri Satinder Kumar Verma would pay total amount of Rs. 5 Lacs to her on equal sharing basis i.e., Rs. 2,50,000/- each out of which the accused and Shri Satinder Kumar Verma together paid to the Complainant Rs. One Lac. That towards the above admitted liability, the accused issued two cheques of Rs. One Lac each, which are the cheques in question.
11.The accused admitted the partnership deed Exh. CW1/DA during his examination u/s 313 Cr.P.C. and also while deposing as DW1. The accused deposed that he wanted to start a commodity business in the year 2008 along with two other people. Initially, husband of the complainant was interested. However, partnership deed was prepared in the name of the complainant and another person namely Satender Kumar Verma, along with him. That they took a shop located at Chandani Chowk and a shop located at Karol Bagh for running the business of the firm by the name of Dhanlaxmi Trading Company. As per partnership deed the total investment of Rs. 1,00,000/- was to be contributed by all the three partners equally. However, no partner including himself contributed any money for starting the said firm. After around one and a half months back complainant started complaining that nothing was happening and the firm was not making any profit. He then told the complainant that the firm would conduct business only when the partners contribute their share of the capital. He further deposed that then a bank account in the name of the firm was opened at Nainital Bank, Tilak Nagar Branch around one month thereafter, as the complainant insisted that she would contribute her share of the capital by cheque only. However, even after opening the above bank account, no partner including himself contributed his or her share of the capital. He also deposed that after some 4-5 months, the CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 7 complainant along with her husband and mother along with 2-3 other people, whose names he did not know, came to the office of the firm at Karol Bagh and started demanding payment from him and the other partner namely Satinder Verma. He told the complainant that she had suffered losses on account of her personal account which she had opened in the name of Paras Ram or Paras Nath trading company and for that he was not to blame. However, the husband of the complainant and other people created a scene (hungama) and threatened him and the other partner namely Satender Verma. He further deposed that the 2-3 other people were anti social people. The said people also threatened to kill him. That he became very frightened and the complainant got signed two blank cheques from him and also got signed some blank papers. Then complainant and the other people accompanying her left the place. The accused further stated that even thereafter, he used to receive threatening calls from the husband of the complainant for which he had also complained to the mother of the complainant. Thereafter, the accused filed the present false case against him. The accused filed a copy of a letter dated 03.03.2009 written by the third partner Satinder Kumar Verma to SHO, PS Pitam Pura, Delhi-88 as Ex.DW1/1 and a copy of application for opening of bank account in the name of the Firm in the Nanital Bank Ltd, Tilak Nagar Branch as mark A. He also filed a copy of the rent agreement dated 21.08.2007 entered between the landlady namely Smt. Chandni Sharma and M/s Dhanlaxmi Trading Company for taking on rent the office located at Kucha Mahajan Chandni Chowk Delhi for the firm as Mark B.
12.It emerges from the above testimonies that other than the Partnership Deed Exh. CW1/DA, which is an admitted document, the agreement Exh. CW1/A is the most crucial document having a bearing on the liability of the accused towards the Complainant on the date of the cheque in question. The said document may now be examined. It bears the date of execution as 22.08.2008.
CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 8 It also bears the attestation of the Notary Public on the same date. The agreeemnt mentions Shri Satinder Kumar Verma and the accused collectively as the first party and the Complainant as the second party. It goes on to record that a Partnership Deed was executed between the parties on 30.08.2007 to carry on the business of Commodities in the name of M/s Dhanlaxmi trading company running its business from Chandani Chowk and Karol Bagh addresses already mentioned in para 10 above. It then records the desire of the Complainant to retire from the business and also that the same was accepted by the accused and Satinder Kumar Verma. After referring to Clause 13 of the Partnership Deed (Exh. CW1/DA) it mentions one month's verbal notice given by the Complainant on 09.07.2008. It then records settlement of accounts in para 3 as per which the First Party would pay total amount of Rs. Five lacs to the Second Party out of which Rs. One lac has been paid to the Second Pary by the first party and the remaining Rs. Four lacs would be paid by the First Party to the Second Party. It then records that Shri Satinder Kumar Verma would pay Rs. Two Lacs through two cheques mentioned therein and that similarly the accused would pay Rs. Two lacs. It then mentions Cheque No. 163294 A/c No. 2008339 and two dates 10.02.2009 and 10.05.2009 which are filled in long hand and the insertion is attested by the accused and the Complainant in the right hand margin nearby. It is also recorded in para 4 that the above amount was towards initial amount inveted by the second party and profit earned up to date of retirement from the business. The agreement is signed by Satender Kumar Verma, the accused and the Complainant and is also witnessed by one Vijay Laxmi and Kapil Arora. In the far end, it bears the seal and the signature of the Notary Public.
13.Now I advert to the testimony of the accused/DW1, which is full of contradictions. During his examination in chief, as noted in the para 11 above, he stated that none of the partners contributed any capital towards the business CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 9 of the Partnership Firm. Yet he admitted that he alonwith the complainant and Satinder Verma started a Partnerhip in the name of Dhanlaxmi Trading Company for the pupose of Commodity business and the company did business for 1 - 1 ½ years. He again said, however, that the said Firm did not do any business as no partner contributed any capital. However, he then stated that he and Satinder Kumar Verma contributed Rs. 33,000/- each as capital of the said Firm and it used to do business through cash funding. He also stated that the complainant did not contribute her share of Rs. 33,000/- but admitted that none the less, the partnership was not dissolved. Thereafter, he again stated that Dhanlaxmi never did any business. The Court then put to him a question that in which name he and Satinder Kumar did business with the contribution of Rs 33,000/- each. He stated in response that he used to do business in his own name. However, he stated again that he had given the said Rs. 33,000/- as his share to Satinder Kumar but he did not know by what name Satinder Kumar did business.
14.The Court fails to understand that if the accused and Satinder Kumar contributed their share of the Capital and did business together as partners while the Complainant did not contribute her share of the capital, then what prevented the two of them from dissolving the partnership and showing Complainant the door? The Court also failes to understand that if no capital at all was contributed by any of the partners, then how the Firm was able to do business in Commodity Trading for 1 - 1 ½ years? It is also very difficult to believe that a partner may invest money in the business firm without even asking the name of the firm through which the businees was carried on.
15.The accused admitted his signatures on the agreement Exh. CW1/A. He also admitted that he himself had not filed any police complaint against the Complainant. It is contrary to ordinary human behaviour that even when a man is forced by anti-social elements to sign blank cheques and blank papers and CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 10 receives threats to his life, he does not care to file any police complaint. The allegation by the accused of Complainant obtaining his signatures on blank papers (meaning the agreement Exh. CW1/A) by use of force also stands belied by the fact that the cheque number and dates are inserted in Para 3 of the said agreement in long hand and the insertion has been attested by the Complainant and the accused by putting their respective signatures in the right hand margin nearby. Now, if the signatures of the accused were obtained on blank papers, as alleged by the accused, his signatures ought to have appeared only at the bottom on each page beacuse in that case the Complainant would not have known that an attestation of correction would also be required in the right hand margin, in the middle of a page.
16.It may also be noted that the agreement Exh. CW1/A is attested by the Notary Public. In the face of the said attestation, it does not lie in the mouth of the accused to allege use of force. Rather, the said attestation also raises a strong inference that the agreement Exh. CW1/A was signed by all the parties with their free will and consent, after fully understanding the contents of the said agreement. It was for the accused to prove use of force by the Complainant/ absense of free consent and one such means was by calling the Notary Public concerned as a witness. However, the accused did not make any effort in the said direction.
17.Even the Police Complaint Exh. DW1/A (which was admittedly filed by Satinder Kumar and not by the accused and that too 6-7 months after the execution of the agreement Exh. CW1/A) goes contrary to the version of events put forward by the accused. It records that sometime back, they three people took a shop at Chandani Chow on rent in partnership on equal sharing basis but suffered heavy losses, which was also to be shared equally. It then alleges that Aman Kalra (husband of the complainant) says that he has nothing to do with the loss and demands return of the entire money which he invested CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 11 in the business. Now, this is a document filed by and relied upon by the accused himelf. First and foremost, how could the firm suffer losses if no capital at all was invested by any of the partners? Further, in the Police Complaint itself it is admitted in clear terms that Aman Kalra, i.e, husband of the Complainant, had invested money in the business started by "we three people", i.e., the Complainant, the accused and Satinder Kumar Verma. This admission alone is sufficient to demolish the defence of the accused that the Complainant never invested any capital in the Firm. The picture becomes clearer when the above Police Complaint is read along with deposition of the accused where in he stated that initially, husband of the complainant was interested. However, partnership deed was prepared in the name of the complainant and another person namely Satender Kumar Verma, along with him. The combined reading of the Police Complaint and above part of the testimony makes is abundantly clear that the Complainant invested capital in the Firm.
18.The testimony of the accused further loses credence when the rent agreement Mark B, filed by the accused himself, is closely examined. It bears the date of execution as 21.08.2007 and is also attested by a Notary Public on the same date. It mentions the landlady Smt. Chandani Sharma as first party and M/s Dhanlaxmi Trading Company, through its Partners namely the Complainant, the accused and Satinder Kumar collectively as the second party and records the agreement of the landlord to let out the office located at Chandani Chowk on hire of Rs. 12,000/- per month. As noted above, the accused stated during his cross examination that Dhanlaxmi Trading Company did the business for 1
- 1 ½ years. Now, it would have been impossible for the accused or the Firm to bear the above rent of Rs. 12,000/- per month without any partner contributing any capital at all.
19.It is also pertinent to note that both the cheques in question were returned CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 12 dishonoured with the remarks 'Funds Insufficient'. It is also difficult to understand that if the cheques in question were obtained from the accused by force, then what prevented him from stopping the payment of the said cheques?
20.Further, while the accused stated during his chief examination that he had told the Complainant that she had suffered losses on account of trading in Parasram Trading Company, during cross examination, however, he took a complete U- turn and stated that Complainant herself told him about the losses. Now, how did the accused come to know about alleged losses suffered by the Complainant on account of her trading in the Parasram Trading Company? It raises a strong inference that the said account was operated by the accuseds and also that the same was just a device to trade in the shares on the understanding that the profits/losses arsing out of the said trading would belong not to the Complainat but to the Firm.
21.Now I shall advert to the testimony of the Complainant and the argumens advanced by Ld. Counsl for the accused. Ld. Counsel drew the attention of the Court to the statement of the Complainant during her cross examination as CW1 wherein she admitted that as per Clause 4 of the Partnership Deed Exh. CW1/DA, the partners were free to carry on any business with mutual consent and also that she issued the cheque in the sum of Rs. Five Lacs upon her personal account in favour of Paras Ram Trading Company, Ashok Vihar Branch in the year 2007. Ld. Counsel further cited admission by the Complainant that she had received Rs. One Lac from the said company after opening of the DMAT Account and further admission that she had not filed any proof regarding investment of Rs. Five Lacs in Dhanlaxmi Trading Company. On the basis of the above statements, Ld. Counslel for the accused argued that the Complainant did the business of shares independently through Parasram Trading Company and suffered losses on account of the said trading. Ld. CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 13 Counsel, while citing clause 4 of the Partnership Deed Exh. CW1/DA, sought to argue that for the losses suffered by the Complainant in her individual capacity, the other two partners could not be held accountable.
22. I have carefully considred the above sumbissions of the Ld. Counsel. These arguments are, however, not tenable in the face of finding given by me above, on the basis of the testimony of the accused himself, that the account opened in the name of the Complainant with the Parasram Trading Compay was just a device to trade in the shares on the understanding that the profits/losses arsing out of the said trading would belong not to the Complainat but to the Firm and also that the above account was managed not by the Complainant, but by the accused on behalf of the firm. It also emerges from the testimony of the Complainant that she invested the amount of Rs. 5 Lac for the business of the Firm namely Dhanlaxmi Trading Company, which was of commodity trading. The complainant has also stated that she invested the said amount through her DMAT Account opened with Parasram Trading Company on the asking of the accused and the third partner Satinder Kumar Verma that the said sum could not be directly invested in the name of the Firm itslef on the pretxt that the account in the name of the firm was yet not opertional. However, in my considered opinion, so long as the business of commodity trading was transacted with the help of the above Rs. Five Lacs, the said investment was in confirmity with the Partnership Deed as the said Deed only mentioned the business of the firm as Commodity Business and nowhere put the restriction that the said business was to be transacted through the account opened in the name of the said firm only. Thus, the above investment of Rs. Five lacs by the Complainant would also be counted as an investment in and towards the business of the firm.
23.Ld. Counsel for the accused also pointed out that above admission by the Complainant of having received Rs. One Lac in her DMAT account opened CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 14 with the Parasram Trading Company to argue that the same also proved that the Complainant dealt in share trading through the said Company in her individual capacity and also received profits therefrom in her individual capacity.
24.The above argument seems convincing at the first brush. However, closer scrutiny of the evidence on record reveals that the above argument is not only un-tenable, it is also contrary to the evidence on record. First and foremost, as noted in para 12 above, the agreement Exh. CW1/A itself records that the First Party would pay total amount of Rs. Five lacs to the Second Party out of which Rs. One lac has been paed to the Second Pary by the first party and the remaining Rs. Four lacs would be paid by the First Party to the Second Party. The Complainant also stated during her cross examination that the above Rupees One Lac was towards deemd payment of Rs. 50,000/- each by the accused and the third partner Surinder Kumar Verma. The words typed in italics above, when read with the above statement of the Complainant are enough to refute the above argument of Ld. Counsel of the Complainant and to prove that the DMAT Account opened in the name of the Complainant with the Parasram Trading Company was operated by all the partners of the Firm for carrying on the business of the firm.
25.Ld. Counsef for the accused also laid emphais on Arbitration Clause in para 15 of the Partnership Deed Exh. CW1/DA to argue that the partners were under an obligation to refer all the disputes to the Arbitrator and the present complaint, which was lodged without first exhausting the remdey of arbitraion, was not maintainable. This argument lacks force on the face of it for the reason that a criminal complaint us 138 NI Act can be lodged by any payee or holder in due course if the preconditions set out in that Section are satisfied. Secondly, the nature of proceedings under the said Section is criminal in nature while arbitration is civil remedy and both of them operate independently of each other. Thus, invoking of arbitration clause by the payee/holder is due course, CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 15 where it existed, is not a pre-condition for lodging a complaint u/s 138 NI Act.
26.Ld. Counsel for the accused also argued that cheque bearing no. 580588 Ex. CW1/B1 has not been mentioned in agreement Exh. CW1/A and, therefore, the said cheque was issued by the accused without any liablity towards the Complainat and thus, the present Complaint was not maintainable against the above cheque. In support of the above argument, Ld. Counsel also pointed out towards the staement of the Complainant during her cross examination that she had filed the present complaint in respect of the cheques mentioned in para 3 of the said agreement. This argument may now be considered. As noted in para 12 above, it is reorded in para 3 of the agreement Exh. CW1/A that the accused would pay Rs. Two lacs to the Complainant. It then mentins Cheque No. 163294 A/c No. 2008339 (which is the same as the cheque Exh. CW1/B2) and two dates 10.02.2009 and 10.05.2009 which are filled in long hand and the insertion is attested by the accused and the Complainant in the right hand margin nearby. It is petinent to mention that even while liability of the accused to pay Rs. Two Lacs is clearly stated in the said para, the particulars of only the above cheque Exh. CW1/B2 amounting to Rs. One Lac have been filled and as against the date 10.05.2009, no particulars of any cheque have been metioned. It clearly emerges from the above para that liability of the accused was Rs. Two lacs which was payable by way of two cheques. One such cheque amounting to Rs. One Lac has been clearly stated in the agreement itself and is the same as cheque Exh. CW1/B2. As the particulars of the other cheque have not been mentioned, it follows from simple logic that another cheque of Rs. One Lac wa also due from the accused, the particulars of which could not be recorded at the time of execution of the agreement Exh. CW1/A. Thus, collective reading of the above para 3 of the agreemnent coupled with cheque Exh. CW1/B2 leads to the unmistakable conclusion that the cheque CW1/B1 was also issued by the accused as payment of Rs. One Lac to the Complainant, CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 16 remaining out of the above admitted liability of Rs. Two Lacs. Merely because the particulars of the said cheque CW1/B1 could not be entered into the relevant para 3 of the agreement would not make it a cheque issued without liability. In view of the abve discussion, the present argument of the Ld. Counsel for the accused is also not tenable and is liable to be rejected.
27.From the above discussion, I am of the considered opinion that the accused has failed to raise any probable defence or to show even by preponderance of probabilities that the complainant used force upon him while obtaining the cheques in question. He has also failed to rebut the presumptions arising in favour of the complainant u/s 118 and 139 N I Act either with the aid of his own testimony or by assailing the evidence of the complainant or through her cross examination.
28.Ld. Counsel for the accusd also pointed out towards statement of the Complainant made druing cross examinatin that cheque Exh. CW1/B1 was only signed by the accused and the remaining particulars had been filled by her husband. In view of the same, Ld. Counsel argued that offence u/s 138 NI Act was not made out against the accused as against the above cheque. This argument may now be examined.
29.Section 20 NI Act provides for "inchoate stamped instruments" and states that if a person signs and delivers a paper stamped in accordance with the law and "either wholly blank or have written thereon an incomplete negotiable instrument" such person thereby gives prima facie authority to the holder thereof "to make or complete as the case may be upon it, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp."
30.The position in law has been explained in the judgment of the Division Bench of the Kerala High Court in Lillykutty v. Lawrance 2003 (2) DCR 610 in the following words:
CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 17 "In the instant case, signature is admitted. According to the drawer of the cheque, amount and the name has been written not by the drawer but by somebody else or by the payee and tried to get it encashed. We are of the view, by putting the amount and the name there is no material alteration on the cheque under Section 87 of the Negotiable Instruments Act. In fact there is no alteration but only adding the amount and the date. There is no rule in banking business that payee's name as well as the amount should be written by drawer himself. "
31.The above judgment was quoted with agreement by the Hon'ble Delhi High Court in Ravi Chopra vs State & Anr. 2008(2) JCC (NI) 169 and it was held that if the signatures on the cheque are admitted by the accused, it matters little if the name of the payee, date and amount are filled up at a subsequent point in time. In view of the judgments discussed above, the present contention of the Ld. Defence Counsel also has no force in the eyes of law.
32.Now authorities relied upon by Ld. Counsel for the accused along with arguments made on the point of law be cosidered. While relying upon Kali Ram (supra), Ld. Counsel also argued that even before the presumption u/s 118 and 139 NI Act arise in favour of the Complainat, ingredients of Section 138 NI Act, inluding the existence of legally recoverable debt in her favour is to be proved by the Complainant. Taking the said argument forward, Ld. Counsel stated that for the said presumption to arise in favour of the Complainant, she was bound to prove the agreement Exh. CW1/A. Ld. Counsel also argued that mere admission by the accused of his signatures on the said agreement does not amount to proof of contents of the said agreement and that the Complainant herself was bound to prove the said document independent of the above admission of signatures by the accused. Ld. Counsel also relied upon Kiran Das Vs. Uma Ram Bhuyan 2007 (2) CCC 362 (Gau) and Ramjan Khan Vs. Baba Raghunath Das AIR 1992 MP 22 on this point.
CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 18
33.Ld. Defence Counsel also relied upon Sanjay Cotton Co. Vs. Omprakash Shivprakash AIR 1973 Bom. 40 to argue that consent by a party to exhibit a document does not amount to an admission of its contents. Ld. Counsel further argued that a party has a right by cross examination to show that the document is not genuine.
34.Ld. Defence Counsel, while relying upon V.K. Gemini Vs. Chandran 2007 Cr.LJ 1285 Ker = AIR 2007 Ker 2036 contended that presumption u/s 139 shall be drawn in favour of the Complainant only if is established by evidence and other material on record that she was the "holder" of the cheque issued by the accused and that in absence of such evidence or other material, the Complainant could not be relieved of the burden of proving the ingredients of the offence u/s 138 NI Act. Ld. Counsel also relied upon B. Mohan Krishna Vs. Union of India 1996 Cr.L.J. 636 to contend that the rebuttable presumption u/s 139 NI Act operates only in favour of a payee or holder in due course but not in favour of a person who without consideration became the holder of the cheque.
35.Ld. Counsel also relied upon Shrimathi Vs. Renuka 2010 Cr.L.J. 372 (Kant) to argue that the presumption u/s 139 extends ony to the issuance of cheque towards discharge of a legally enforceable debt of liability and it has to be raised only after the Complainant establishes that such debt or liability in fact existed as on the date of the cheque in question and that the cheque was given to her by the accused. On the strength of the above authority, Ld. Defence Counsel argued that the Complainant in the present case was bound to show what business was run by the partners of the Firm in question to prove the existence of liability in her fovour.
36.On the basis of Kamalammal Vs. C.K.Mohanan & Anr. 2007 Cr. L.J. 3124 (Ker) = AIR 2007 Ker 2108 (NOC), Ld. Defence Counsel contended that a Court shall draw presumption u/s 139 NI Act only if all the requirements for CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 19 drawing the said presumption are established by the Holder of the cheque, which requirements are that (i) the person in whose favour the presumption is drawn is the holder of the cheque; (ii) the cheque is of the nature stated in Section 138 NI Act; and (iii) that such cheque is received by the holder. Deriving strength from the same authority , Ld. Counsel also contended that the expression "received" used in Section 139 NI Act could not be equated with the expression "issued" meaning executed.
37.While relying upon Shri Vinay Parulekar Vs. Sri Pramod Meshram 2008 (2) MhLj 115 Ld. Defence Counsel contended that the accused could prove non- existence of consideration for which the cheques were issued and if the accused discharges the initial onus of proof by showing that esixtence of consideration is improbable or doubtful or illegal, the onus of proof would shift to the Complainant.
38.With the aid of B Indramma Vs. Sri Eshwar 2009 (4) Civil L.J.425 Ld. Defence Counsel also sought to contend that in order to raise presumption u/s 139 NI Act, the Complainant has to establish the fact that it was she who received from the acused the cheque in question. Ld. Counsel further argued that when the very factum of delivery of the cheque in question by the accused to the Complainant was seriously disputed, the said presumption would not arise.
39.Ld. Defence Counsel while relying upon AIR 1928 PC 38, AIR 1965 Ori 126 and (1965) 2 Cr.LJ 107 also contended that execultion of a document means something more than mere signing and that the doucment must be stated or read out to the executant and only thereafter the executant enters into an obligation under the said document. Ld. Counsel also relied upon Madholal Sindhu Vs. Asian Assurance Co. Ltd. & Ors. (1954) 56 BOMLR 147 to contend that where the issue before the Court was as to whether the contents of a doucment are correct, it was not enough to prove the signature of the person CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 20 who signed the said doucment. It could be proved only by calling the person who could depose as to the correctness of the contents of the document and who had a personal knowledge of the contents of the doucment. Ld. Defence Counsel thus argued that it was for the Complainant to prove the agreement Exh. CW1/A by examining the two witnesses named in the said agreement. Ld. Counsel, while relying upon Dattatraya Vs. Rangnath Gopal Rao Kawathekar AIR 1971 SC 2548 also argued on the same line that when the execution of a doucment is denied, the party seeking to prove that document must not only prove that the alleged executant has signed that document, but he must also prove that the executant had signed the same with the knowledge of its contents.
40.Ld. Counsel for the Complainant made forceful submissions in rubuttal of the above submissions on law point advanced by the Ld. Counsel for the accused and also replied upon the following authorities in support of the same,- (i) Surinder Singh Vs. State of Delhi 2010 (2) JCC 1001; (ii) Samunder Vs. State 2010 (2) JCC 1178; (iii) Praveen Kumar Vs State 2010 (2) JCC 1465;
(iv) Rajinder @ Lala & Ors. Vs. State 2010 Crl.L.J. 15; (v) Aquil Khan Vs. State 2010 (3) JCC 1739; (vi) Maman Chand Vs State 2008 (3) JCC 1953;
(vii) V.N. Deosthali Vs. State through CBI 2010 (1) JCC 466; (viii) Jayamma Vs. Lingamma 2012 (3) JCC (NI)175; (ix) M/S M. M. T. C. Ltd. & Anr vs M/S Medchl Chemicals & Pharma (P) Ltd 2002 SCC (Cri) 121; and (x) Rangappa Vs. Sri Mohan (2010) 11 SCC 441.
41.The above authorities may now be discussed. The arguements advanced by Ld. Counsel for the accused on the basis of the authorities relied upon by him fall into the following two borad heads, (i) That there was no presumption of existence of legally enforceable debt or liability in favour of the Complainant u/s 139 NI Act and it was for the Complainant to prove the same as a matter of fact; (ii) That the said burden to prove the debt by the Complainant did not get CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 21 discharged merely by admission of signatures by the accused on the agreement Exh. CW1/A and it was for the Complainant to prove that agreement by calling the witnesses to the same.
42.The first argument concerns the scope of presumption u/s 139 NI Act and the manner in which it can be raised. It would be useful to refer to some decisions of the Hon'ble Supreme Court on the above legal issue. In Hiten P. Dalal v. Bratindranath Banerjee (2001) 6 SCC 16, it was held (Ruma Pal, J. at Paras. 22-23) as follows:
"22. Because both Sections 138 and 139 require that the Court `shall presume' the liability of the drawer of the cheques for the amounts for which the cheques are drawn, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption has been established. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused (...). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court may presume a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable probability of the non- existence of the presumed fact.
"23. In other words, provided the facts required to form the basis of a presumption of law exists, the discretion is left with the Court to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, after considering the matters before it, the Court CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 22 either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the prudent man."
43.Similarly, in Bharat Barrel & Drum Manufacturing Company V. Amin Chand Pyarelal (1993) 3 SCC 35 (Para. 12), Hon'ble Supreme Court observed as follows:
"Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a consideration by raising a probable defence. 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. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non-existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 23 Section 118(a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that it did not exist."
44.Further, in Rangappa Vs. Sri Mohan (2010)11 SCC 441, Hon'ble Supreme Court held that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. It was also observed that to that extent, the impugned observations in Krishna Janardhan Bhat v. Dattatreya G. Hegde AIR 2008 SC 1325 might not be correct and were overruled.
45.Similarly, in the case of Maruti Udyog Ltd. v. Narender (1999) 1 SCC 113, Hon'ble Supreme Court has held that by virtue of Section 139 of the Negotiable Instruments Act, the Court has to draw a presumption that the holder of the cheque received the cheque for discharge of a debt or liability until the contrary is proved. In K. N. Beena v. Muniyappan 2001 (7) SCALE 331 also it has been held by the Hon'ble Supreme Court that under Section 139 of the Negotiable Instruments Act the Court has to presume, in a complaint under Section 138, that the cheque had been issued for a debt or liability.
46.After referring to both the above decisions, it was held by the Hon'ble Supreme Court in M/S M. M. T. C. Ltd. & Anr vs M/S Medchl Chemicals & Pharma (P) Ltd 2002 SCC (Cri) 121 that there was therefore no requirement that the CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 24 Complainant must specifically allege in the complaint that there was a subsisting liability. The burden of proving that there was no existing debt or liability was on the accused, which he had to discharge in the trial (emphasis supplied).
47.The legal position which clearly emerges from the above decisions is that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability and there was therefore no requirement that the Complainant must specifically allege in the complaint that there was a subsisting liability. Further, the said presumption arose in case signature on the cheqe in question was admitted by the accused, which is the position in the present case. The burden of proving that there was no existing debt or liability was on the accused, which he had to discharge in the trial. Only after the said presumption was rebutted by the accused, did the burden of proof shift upon the Complainant to prove the debt as a matter of fact. The accused sought to rebut the said presumption by alleging that the Complainant obtained his signatues on the agreement Exh. CW1/A and on the cheques in question by use of force. However, after consideration of the testimonies of the Complainant as well as the accused and of evidene on record, I have already held that the accused failed to show, even by preponderance of probabilities, that any force was used upon him by the Complainant. The accused has also failed to rebut the presumptions arising in favour of the Complainant u/s 118 and 139 NI Act, either through the cross examination of the Complainant or with the help of his own testimony.
48.In the light of judgment of the Hon'ble Supreme Court in Rangappa(Supra) the authorities of Kali Ram Vs. State of Himachal Pradesh (1973) 2 SCC 808 (supra), Kiran Das Vs. Uma Ram Bhuyan 2007 (2) CCC 362 (Gau) (supra) Shrimathi Vs. Renuka 2010 Cr.L.J. 372 (Kant) (supra) and Ramjan Khan Vs. Baba Raghunath Das AIR 1992 MP 22 (supra) relied upon by the CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 25 accused are of little help to him.
49.The fact of V.K. Gemini Vs. Chandran 2007 Cr.LJ 1285 Ker = AIR 2007 Ker 2036 (supra) relied upon by the accused were different as in that case, the defence of the accused was that he had been mentally sick for the past 8 to 9 years prior to the alleged transaction. Because of the peculiarity of the disease, his mental condition was impaired. In such state of mind, he was in the habit of issuing cheques to various persons, without owing anything to them. The accused used to assume himself to be a very affluent person during such period. But people used to return such cheques understanding the peculiar and abnormal habit of the accused. Ext.P1 (the cheque in question in that case) was one of such cheques issued to complainant which was misused by the complaint to file the complaint. The accused actually did not owe any money to complainant and he did not issue any cheque for the discharge of any debt or other liability, as alleged. On an analysis of the evidence, particularly medical evidence adduced by accused, the Ld. Trial Court found that prosecution failed to establish that Ext.P1 cheque was issued by the accused for the discharge of a debt and hence the accused was acquitted. The facts of the present case are, however, entirely different as the accused admitted signatures on the cheques in question and also failed to prove the defence of use of force by the Complainant.
50.Similarly, the reliance placed by Ld. Counsel for the accused on B. Mohan Krishna Vs. Union of India 1996 Cr.L.J. 636 (supra) is, in my humble opinion, misplaced as the issue before the Hon'ble Andhra High Court with reference to Section 139 NI Act was whether the presumption in section 139 in favour of the holder of a cheque was violative of the guaranteed fundamental right of an accused person under clause (3) of article 20 of the Constitution of India The Court answered the said question in the negative and held that it was incumbent on the Court, in a prosecution under section 138, unless the contrary CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 26 is proved, to draw the inference that the cheque received by its holder was a cheque of the nature referred to under section 139 for the discharge, in whole or in part, of any debt or other liability. It further held that the said presumption was displaced only when the truth of the inference was disproved on other evidence.
51.It was no doubt observed by the Hon'ble Andhra High Court that the presumption incorporated in section 139 was not intended to cover all kinds of holders and it covered only the holder of a cheque "of the nature referred to in section 138". It was further observed that only in respect of a cheque which was issued in discharge, in whole or in part, of a debt or other liability, the presumption operated in favour of the payee and as well as in favour of a holder in due course as defined in section 9. The said observation, however, is also not of any help to the accued for, as already noted above from the decisions rendered by the Hon'ble Supreme Court that the presumption u/s 139 NI Act arose in a case where the signatures on the cheque are admitted by the accused. The accused in the present case not only admitted his signatures but he also admitted that the cheque in question were given to the Complainant herself. His defence of signatures being obtained by force has already been rejected by this Court. In such facts and circumstances, it was for the accused to rebut the presumption u/s 118 and 139 NI Act by showing, on the scale of pre-ponderance of probabilities, that the consideration of the two cheques in question was either absent or improbable or was illegal. However, the accused has utterly failed to show any of the above grounds.
52.Kamalammal Vs. C.K.Mohanan & Anr. 2007 Cr. L.J. 3124 (Ker) = AIR 2007 Ker 2108 (NOC) (supra) relied upon by Ld. Counsel for the accused is also not of any help to the accused as the three requiements mentioned in the said judgment stand fulfulled. Further, the said judgment has to be read in conformity with Bharat Barrel & Drum Manufacturing Company v. Amin CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 27 Chand Pyarelal (1993) 3 SCC 35 (supra) in which it was held by the Hon'ble Supreme Court that the presumption u/s 118 (a) arose in favour of the Complainant in case the signatures on the negotiable instrument were admitted by the accused, that being squarely the case at present.
53.There can be no dispute about the legal postion laid down in Shri Vinay Parulekar Vs. Sri Pramod Meshram 2008 Cr. L.J. 2405 (Goa) = 2008 (2) MhLj 115 (supra) relied upon by the Ld. Defence Counsel that the accused could prove non- existence of consideration for which the cheques were issued and if the accused discharges the initial onus of proof by showing that esixtence of consideration is improbable or doubtful or illegal, the onus of proof would shift to the Complainant. However, the said decision is also of little help to the accused as he failed to rebut the presumptions u/s 118 and 139 NI Act in favour of the Complainant and thus failed to shift the onus of proof upon the Complainant.
54.The decision in B Indramma Vs. Sri Eshwar 2009 (4) Civil L.J.425 (supra) relied upon by Ld. Counsel for the accused was given by the Hon'ble High Court of Karnataka after relying upon the judgment of the Hon'ble Supreme Court in Krishna Janardhan Bhat v. Dattatreya G. Hegde AIR 2008 SC 1325 (supra). However, the said legal position has overruled by the Hon'ble Supreme Court in Rangappa (supra). That being so, ratio of B Indramma (supra) also loses legal force. Even the facts of the said case were also different as the Ld. Trial Court recorded a finding that whatever transaction took place, it took place between the husband of the complainant and the accused but not between the complainant and the accused. As the facts of the present case, which have already been noted elaborately in the preceding paras, are different, so on that ground also the ratio of B Indramma (supra) does not apply to the present case.
55.Now coming to the second part of the legal submissions advanced by the Ld. CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma 28 Defence Counsel that the burden to prove the debt by the Complainant did not get discharged merely by admission of signatures by the accused on the agreement Exh. CW1/A and it was for the Complainant to prove that agreement by calling the witnesses to the same.
56.I have already noted in the preceding paras the settled legal position that Sections 118 and 139 NI Act introduce an exception to the general rule as to the burden of proof in criminal cases and shift the onus on to the accused. If the accused 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 complainant who would be obliged to prove it as a matter of fact. However, as the accused miserably failed to rebut the said presumtions, the onus never shifted upon the Complainant in the present case to prove the debt/liability or to prove the agreement Exh. CW1/A. The decisions in AIR 1928 PC 38, AIR 1965 Ori 126 and (1965) 2 Cr.LJ 107 (supra), Madholal Sindhu Vs. Asian Assurance Co. Ltd. & Ors. (1954) 56 BOMLR 147 (supra) and Dattatraya Vs. Rangnath Gopal Rao Kawathekar AIR 1971 SC 2548 (supra) relied upon by the accused would have been applicable only when the onus would have shited to the Complainant. That not being the case, the ratio of the above authorities also has no application to the facts of the present case.
57.Finally, there can be no dispute about the legal postion laid down in Sanjay Cotton Co. Vs. Omprakash Shivprakash AIR 1973 Bom. 40 (supra) that consent by a party to exhibit a document does not amount to an admission of its contents and a party has a right by cross examination to show that the document is not genuine. The said decision, however, does not aid the accused as he failed to assail the genuineness of the agreement Exh. CW1/A as the Complainant stood her ground despite being cross examined at length on behalf of the accused.
CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma
29
Order
58.In view of my above findings, I hold that the complainant has been able to prove her case against the accused beyond reasonable doubt. Accordingly, accused Tushar Verma is convicted of the offence under section 138 of the Negotiable Instruments Act. Order on sentence shall be passed after hearing the convict. A copy of this judgment be given to the Convict dasti and free of cost.
Announced in open Court on (JAGMOHAN SINGH) 20th December, 2013 (29 pages) M.M.(NI Act)-08/Dwarka, 20.12.2013/Delhi CC NO:3213/12 Smt. Jyoti Kalra vs Tushar Verma