Delhi District Court
Hdfc Bank vs . Ashwani Kumar on 5 March, 2012
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CC No. 1695/09
IN THE COURT OF MS. GURMOHINA KAUR : METROPOLITAN
MAGISTRATE:SPECIAL COURT13, DWARKA COURTS : NEW DELHI.
C.C NO. 1695/09
HDFC Bank Vs. Ashwani Kumar
1. Complaint Case No. : 1695/09
2. Name of the complainant : M/s. HDFC Ban Ltd.,
having its office at:
9th Floor, Ansal Classique Tower
Plot No. 1, J Block, Community
Centre, Rajouri Garden,
New Delhi
Through its Authorized
Signatory:
Mr. Gopal Ranga/Gaurav
Lakhanpal/Ankush Saini
3. Name of the accused and his : Ashwani Kumar
parentage and residence RZK105, Street No. 10A, Kamal
Park Colony, Palam Colony,
Near West Sagarpur Govt. School
New Delhi110 045
Ashwani Kumar
Kumar Travels Room No. 302
Vardhman Sunder Plaza,
Sector12, Plot No. 12, Dwarka,
New Delhi110 075
4. Offence complained of or proved: U/s 138 of the Negotiable
Instrument Act, 1881
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CC No. 1695/09
5. Plea of the accused : Pleaded not guilty
6. Final Order : Acquitted
7. Date of Order : 05.03.2012
BRIEF FACTS OF THE CASE
1. The brief facts of the case are that the Complainant is a Bank incorporated under the Companies Act,1956 with its office of business at 9th Floor, Ansal Classique Tower, Plot No. 1, J Block, Community Centre, Rajouri Garden, New Delhi. Earlier Shri Gopal Ranga, the previous AR has tendered pre summoning evidence on 26.05.2009 and later on he was substituted by Mr. Mohd. Rashid vide order dated 30.11.2011and he has been authorized by the complainant in terms of Power of Attorney executed in his favour dated 22.09.2011.
2. It is stated in the complaint that the accused availed a loan bearing No. 13036980. It is further averred in the complaint that the accused in discharge of his partial liability issued cheque bearing No. 895903 dated 07.03.2009 which are Ex.CW1/B, drawn on HDFC Bank, Mahavir Enclave, Palam Dabri Road, New Delhi110 045 and when the said cheque was presented for encashment the same were returned back with remark 'insufficient funds' vide return memo dated 31.03.2009 i.e. Ex.CW1/C.
3. The complainant bank further avers in its complaint that a legal demand notice which is Ex.CW1/D dated 08.04.2009 was sent by the complainant company through its lawyer which was duly served by speed post receipts dated 08.04.2009 which are Ex.CW1/E and Ex.CW1/E1 respectively and that 3 CC No. 1695/09 the accused failed to make the payment within the statutory period of 15 days and hence this criminal complaint was filed by the complainant.
4. Summons were sent to the accused on 26.05.2009. Upon service of summons, the accused put his appearance for the first time before the Court on 18.07.2011 and was granted court bail on the same date. Notice was framed against the accused on 24.08.2011 to which he pleaded not guilty and claimed trial.
EVIDENCE
5. To support its case, the complainant bank examined one witness Mr. Mohd. Rashid, AR of the Complainant bank as CW1 on 21.12.2011.
6. CW1 tendered his evidence by way of affidavit and reiterated the contents of the complaint and relied upon the documents Ex.CW1/A to Ex.CW1/F. During his crossexamination, CW1 stated that the accused was granted an auto loan of Rs.5,59,000/ and the said loan was repayable in 36 EMIs. It was further submitted that the accused had only paid about 3 to 4 EMIs and admitted that the loan was repayable by way of ECS. CW1 however denied that the accused had issued the cheque in question as security cheque but again stated that he was not aware. It was further stated by CW1 that the cheque amount was equivalent to the three defaulted EMIs as on the date of issuance of cheque in question and further added that a total outstanding of Rs.99,196/ was pending against the accused at the time of issuance of cheque in question. CW1 however denied the suggestion that no legal notice was ever served upon the accused. The AR also admitted that the vehicle was re possessed by the complainant bank but added that the same was only done after the dishonor of the cheque in question and denied that the same proceeds 4 CC No. 1695/09 on the repossessed vehicle was more than the total outstanding amount at the time of sale of vehicle.
7. Thereafter, CE was closed on 21.12.2011 and the matter was fixed for recording of statement of accused.
8. The statement of the accused under Section 313 of Cr.P.C. was thereafter recorded on 18.01.2012 wherein accused stated that he had given the cheque in question as security cheque towards the loan amount as the mode of payment of installments was through ECS. It was further stated that he did not receive any legal demand notice. The accused also added that his vehicle has already been repossessed forcibly without serving any legal notice upon him.
9. Accused did not lead any Defence Evidence and therefore, DE was closed vide order dated 31.01.2012 and the matter was fixed for final arguments. ARGUMENTS
10. During final arguments, Ld. Counsel for complainant bank submitted that all the necessary ingredients of Section 138 of the Negotiable Instruments Act had been fulfilled. Ld. Counsel further argued that the accused has admitted the loan and the signatures on the cheque in question. It was further stated that the accused has admitted his liability and the legal demand notice was sent at the correct address. It was further submitted that the defence was not able to prove that the cheque in question was a security cheque.
11. On the other hand, Ld. Counsel for the accused has argued that the complaint no where mentions the loan amount availed by the accused. It was however 5 CC No. 1695/09 stated that the loan was repayable by way of ECS. It was further argued that the cheque in question was a security cheque issued by the accused at the time of availing the loan and that the vehicle financed was already repossessed and resold by the complainant without any information or intimation to the accused and the sale proceeds of the same were not adjusted in the total outstanding amount of the accused. It is further argued that the complainant has been unable to show what was the partial liability against the accused and with respect to legal demand notice it was argued that no proof of delivery has been placed on record.
SECTION 138 NEGOTIABLE INSTRUMENTS ACT
12. This court has heard the arguments on both the sides and have carefully gone through the record. On the basis of the facts and arguments placed before the court, the main issue to be decided is whether the accused had issued the cheque in question in discharge of his partial debt/liability.
13. It is now pertinent to go through Section 138 of Negotiable Instruments Act.
138. Dishonour of cheque for insufficiency, etc., of funds in the accounts Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for"a term which may extend to two 6 CC No. 1695/09 year", or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless
(a) The 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.
(b) The payee or the holder induce course of the cheque, as the case may be, 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 thirty days" of the receipt of information by him from the bank regarding the return of the cheques as unpaid, and
(c) The drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation: For the purpose of this section, "debt or other liability"
means a legally enforceable debt or other liability.
14.It is pertinent to mention section 139 and Section 118 of the Negotiable Instruments Act which are as follows:
"Section 139. Presumption in favour of holder It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability."7
CC No. 1695/09
"Section 118. Presumption of Negotiable Instruments of consideration Unless the contrary is proved, the following presumptions shall be made
(a) of considerationthat every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration;
(b) as to date that every negotiable instrument bearing a date was made or drawn on such date;
(c) as to time of acceptance that every accepted bill of exchange was accepted within a reasonable time after its date its date and before its maturity;
(d) as to time of transfer. that every transfer of a negotiable instrument was made before its maturity;
(e) as to order of endorsements that the endorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;
(f) as to stampsthat a lost promissory note, bill of exchange or cheque was duly stamped;
(g) that holder is a holder in due course that the holder of a negotiable instrument is a holder in due course; provided that, where the instrument has been contained from its lawful owner, or form any person in lawful custody thereof, by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him." 8 CC No. 1695/09
15. Section 139 of the Negotiable Instruments Act lays down that it shall be presumed, unless contrary is proved that the holder of the cheque received the cheque of the nature stated in section 138 for the discharge of a debt or liability.
16. The accused may rebut the presumption under Section 139 and Section 118 of the Negotiable Instruments Act by leading evidence or by showing the preponderance of probabilities.
In Rangappa v. Sri Mohan 2010 STPL(DC) 952 SC, it was observed in para 14 that:
1. "14.................................However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of' preponderance of probabilities'.
Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials 9 CC No. 1695/09 submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
17. Under the Negotiable Instruments Act, the accused has to disprove the presumption raised against him by virtue of section 139 of the Negotiable Instruments Act that it shall be presumed, unless the contrary is proved, that the holder of the cheque in question received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or any other liability. Also, according to Section 118 of the Negotiable Instruments Act, there is a presumption that every negotiable instrument is drawn for a consideration. It is for the accused to rebut these presumptions by leading evidence in his defence.
18. The case of the complainant is that the cheques in question was issued by the accused in discharge of her partial debts. The complainant has also filed the statement of account. However, the same has not been tendered in evidence.
19. The accused has taken the plea that the complainant has misused the cheque in question which he has handed over to the complainant at the time of availing the loan and he never issued the cheque in question against the outstanding dues. It is an admitted fact that the accused had availed a loan from the complainant bank. It is also admitted that loan was repayable in 36 installments of Rs.18,800/ each. The complainant in his crossexamination has stated that the loan was repayable by way of ECS but stated that he was not aware that whether the cheque in question was given as security cheque by the accused at the time of availing the loan.
20. In the present complaint, the accused has admitted that he has signed the impugned cheque, however, the same was handed over to the complainant in 10 CC No. 1695/09 blank as a security cheque. The question to be decided by the court in this case is that whether the cheque in question was issued towards any legally enforcible liability. During the crossexamination, CW1 has specifically stated that the loan was repayable by way of ECS and that the cheque is with respect to three monthly installments outstanding against the accused. However, the statement of account placed on record by the complainant does not mention the mode of repayment of loan. The accused has stated this fact in his statement recorded U/s 313 Cr. P.C. wherein he stated that the loan was repayable by way of ECS and that he had issued the cheque in question in blank as a security cheque at the time of availing the loan. It is also seen that the monthly installment of the loan was Rs.18,800/ each and the AR in his crossexamination has stated that the cheque in question is with respect to three monthly installments. However, it has not been stated anywhere in the complaint that for which months this amount is calculated. The complainant when asked a specific question as to whether the complainant company had taken the cheque in question as security, the AR firstly denied the aforesaid and later on said he was not aware. The complainant has not placed on record any document to show the mode of repayment of the loan amount and also as to when the cheque in question was handed over by the accused to the complainant. The complainant has also not been able to produce before the court any evidence to show that on what basis the cheque in question was filled up and for which months the said cheque were due.
21. The defence Counsel has specifically asked the AR whether the sale proceeds of the vehicle had been adjusted in the total outstanding amount as on the date of issuance of cheque to which the AR replied that he was not aware and could also not say whether any intimation was given to the accused regarding the sale proceeds. The AR has in his crossexamination that the vehicle was repossessed. However, it was stated that the same was 11 CC No. 1695/09 done after the dishonor of the cheque in question. However, nothing has been placed on record to corroborate the aforesaid fact raised by the defence. Therefore the defence story may seem probable that the vehicle had been repossessed and resold by the complainant bank prior to the date of presentation of cheque in question. mere denial of a suggestion does not amount to prove of aforesaid issue and in the present complaint the defence Counsel raised a specific question with respect to repossession and resale of the vehicle and the complainant only denied the aforesaid question and did not bring on record any evidence or document to show when and where the vehicle was repossessed and what was its resale value and whether the sale proceeds were adjusted against the total outstanding balance of th accused. The statement of account placed on record only shows the EMIs to be paid and that which were default and is silent on the aforesaid issue.
22. It is the cardinal rule of law that the complainant has to prove his case beyond reasonable doubts and the accused only has to show some preponderance of probabilities in order to rebut the resumption raised. The case of the complainant should also stand on its own legs and in the present complaint, the complainant failed to show that the cheque in question was issued by the accused himself in discharge of his partial liabilities when the loan itself was repayable by way of ECS. The accused has only admitted his loan liability and has time and again reiterated that the cheque in question was issued in blank as security cheque and was filled up and presented for encashment without any information to him. The accused has also been able to create doubts with respect to his outstanding liability as the factum of re possession and resale of the vehicle has been concealed in the complaint as well as in the evidence and also in the statement of account placed on record.
12CC No. 1695/09
23. In view of the aforesaid facts and discussion, the issue is decided in favour of the accused and against the complainant.
24. Accordingly, this court is of the opinion that offence under Section 138 of N.I. Act read with Section 142 (b) of N.I. Act is not made out.
25. Hence, the accused - Ashwani Kumar is hereby acquitted of the offence. Bail bond and surety bond, if any, stands canceled. Endorsement, if any, be also canceled. File be consigned to Record Room.
Announced in the Open Court
on 05th March 2012 (GURMOHINA KAUR)
METROPOLITAN MAGISTRATE
DWARKA COURT:NEW DELHI