Delhi District Court
Raj Kumar vs Sunil on 24 March, 2018
IN THE COURT OF MS. PARIDHI GUPTA
METROPOLITAN MAGISTRATE, DWARKA COURTS, NEW DELHI
New CC No.: 4991579/16
Raj Kumar versus Sunil
Under Section: 138, The Negotiable Instruments Act, 1881
1. Name & address of the complainant : Raj Kumar,
S/o Sh. Munshi Ram,
R/o H.No. 397, Bichala Panna,
Village Mitraon,
New Delhi 110043.
2. Name & address of the accused : Sunil,
S/o Sh. Karan Singh,
R/o Village Mitraon, opposite,
Shiv Mandir, P.S. Baba Haridas,
Nagar, Najafgarh,
New Delhi 110043
3. Offence complained of : U/S 138, The Negotiable
Instruments Act,1881.
4. Plea of accused : Pleaded not guilty.
5. Final order : Convicted.
6. Date of such order : 24.03.2018
7. Date of Institution of case : 05.08.2015
8. Date of decision of the case : 24.03.2018
New CC No.: 4991579/16
Raj Kumar versus Sunil 27/29
JUDGEMENT
1. Vide this judgement, this court shall dispose of the aforementioned complaint case filed by the complainant, Raj Kumar (hereinafter referred to as the 'complainant') against accused, Sunil (hereinafter referred to as the 'accused').
2. Parties: The complainant, Raj Kumar, allegedly had friendly relations with the accused, Sunil, owing to which the former sold his vehicle to the latter.
3. Factual Matrix: The complainant's case, bereft of unnecessary details, is that the accused approached the complainant to purchase a vehicle owned by him bearing number HR55M7144 in the month of November, 2014. The total sale consideration, as was agreed between the parties, was Rs. 9,00,000/. The complaint agreed to sell the same and the physical possession thereof was consequently handed over to the accused in the second week of December, 2014. The accused paid Rs. 3,68,000/ in cash and for the remaining amount gave a postdated cheque. It is alleged by the complainant that the accused had paid the amount in cash as well as had given the cheque in the presence of one Manoj Kumar.
4. To discharge the liability, the accused tendered a postdated cheque amounting to Rs. 5,32,000/ bearing number 081580 dated 20.06.2015 drawn on Central Bank of India, Village Mitraon, New Delhi110043 (hereinafter referred to as the 'cheque in question') in favour of the complainant with the assurance that the same will be honoured. Upon presentation whereof, however, the same got dishonoured twice and was returned to the complainant vide return memos dated 24.06.2015 with the remarks New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 "Kindly contact drawer/drawee bank and please present again". The complainant thereafter, sent a legal demand notice dated 29.06.2015 to the accused calling upon him to repay the loan amount within fifteen days of the receipt thereof. The complainant has claimed that the said legal notice was duly served at the correct address of the accused through speed post.
5. However, the accused did not come forward to repay his debt within the prescribed period of fifteen days. Hence, being aggrieved, the complainant filed the present complaint under section 138 of The Negotiable Instruments Act, 1881 on 05.08.2015.
6. The complainant has averred that the complaint is within the period of limitation as is prescribed under section 138 read with section 142 of The Negotiable Instruments Act, 1881 and the same falls within the territorial limits of this Court; thus, being tenable at law.
7. Prayed for: As relief, the complainant has sought that the accused be summoned, tried and punished under section 138 of The Negotiable Instruments Act, 1881 and that he be granted adequate compensation under section 357 Cr.P.C.
8. Presummoning evidence: To prove his case prima facie, the complainant led the presummoning evidence under section 200 of the Cr.P.C. by way of an affidavit which is Ex. CW1/A wherein the complainant avouched the same facts as are averred in the complaint.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
9. Documentary evidence: To pillar and reinforce the above claims, the complainant has filed the original cheque in question which is Ex. CW1/1 while the cheque return memo in respect of the cheque in question is Ex. CW1/2. The legal demand notice sent to the accused by the complainant is Ex. CW1/3 and the postal receipt qua the same is Ex. CW1/4.
10. Summoning of accused persons and chain of subsequent events: The learned predecessor court was pleased to summon the accused after hearing the arguments at the stage of presummoning vide order dated 06.08.2015 and the accused entered appearance in the present case on 10.09.2015. He was admitted to bail vide the same order.
11. Notice under section 251 Cr.P.C. was framed against the accused, pursuant to arguments being advanced on the point of consideration thereof, by the court on 21.09.2015. The substance of accusation was read over and explained to the accused and after being satisfied that the accused comprehended the same, the court recorded his plea.
12. Plea of the accused: The accused pleaded not guilty and claimed trial.
13. Evidence of the complainant: To prove his case, the complainant adopted his presummoning evidence as his postsummoning evidence and got himself examined as CW1. He was subjected to crossexamination wherein he inter alia deposed that he has known the accused since fifteen to twenty years as the two have family terms. The complainant admitted that he and the accused used to visit each other's family on occasions of marriage and other celebrations. The complainant testified that the accused New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 is a driver by profession and used to drive a vehicle given by his uncle and now drives a truck given by him.
14. The complainant deposed that in the month of December 2014, he agreed to sell his above mentioned vehicle bearing no. HR55N7144 to the accused and the accused gave him a sale consideration of Rs. 3,68,000/ and the remaining amount of Rs. 5,32,000/ was to be paid by way of a cheque. The complainant clarified that the total sale consideration was Rs. 9,00,000/. He avouched that the said vehicle was purchased by him in the year 2011. Upon being questioned whether the said vehicle has been transferred in the name of the accused, the complainant answered in the affirmative and clarified that he allowed the transfer after receiving an interim payment of Rs. 3,68,000/ as the accused was well known to him.
15. The complainant further asserted that the vehicle was transferred in the year 2014 as he had given the authority to transfer the same in December itself. The complainant further stated that he purchased the said vehicle from Sundram Fiance Ltd. and that the loan installments were deposited by way of cheques. The complainant testified that he is engaged in the business of transport and owns two trucks. He further testified that he has two bank accounts maintained with Axis bank and Canara bank. He again stated that he has a third bank account maintained with Corporation bank and thereafter, again stated that he has a fourth account maintained with Central bank. He deposed that he has been operating the account maintained with Central bank for the last twelve to thirteen years and that with Axis Bank for the last five to six years.
16. The complainant testified that it is incorrect that the payment can be New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 withdrawn from the account after issuance of the cheque book only through a cheque. He clarified that the payment can be withdrawn through ATM or through a voucher/ slip upto an amount of Rs. 50,000/. He also stated that in emergency, a single cheque can also be issued by the bank for the purpose of withdrawal. He admitted that after 2010, the cheque books bear the name of the account holder printed on the cheque itself. However, he voluntarily clarified that the same is applicable only to private banks and not to Government ones.
17. The complainant further avowed that the cheque in question was handed over to him by the accused in the second week of December, 2014 with the assurance that the latter shall pay the entire money before 20.06.2015. The complainant avouched that the cheque in question is a post dated cheque. He stated that, at the time when the accused handed over the cheque to him, a witness namely, Manoj Kumar was also present. He further stated that the particulars therein were not filled by the accused in his presence and that when he had approached him, the cheque was already prepared and was signed.
18. After denying several suggestions, the complainant stated that the finance/ EMIs were completed in the month of July, 2014 and were paid from his account. He further stated that, at times, his account had money to pay the EMIs and at other times, he used to deposit the money in his account. The amount of EMI was Rs. 61,000/ per month. The complainant testified that the accused never deposited a sum of Rs. 61,000/ in his account in a month for the purposes of paying the EMI and that the same was payable through his account maintained with Axis bank.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
19. The complainant avouched that no document was executed when he handed over the possession of the aforementioned truck to the accused and denied having documents pertaining to the job work/ repair work, permit etc. of the aforesaid truck. He however, stated that he can produce the bills in respect of repairs and purchase of tyre. He also stated that he does not have permits as the same are kept in the truck. He clarified that it is a practice to keep permit in the truck for checking etc. He further asserted that he used to take his truck for the repairs at Tata Talco but stated that there is no specific workshop where he used to send his truck as the truck used to travel on various routes.
20. The complainant admitted that the particulars in the cheque and the signatures thereon are in different ink. He again stated that they are written almost in the same ink. He stated that he is not aware that in the year 2010, the Central Bank issued a directive that new cheque bearing the name of the account holder shall be used in place of old cheques. He further admitted that he has filed the present case to recover a sum of Rs 5,32,000/ which the accused owes him. Upon being asked by the Court as to why did he accept a PDC from the accused, the complainant is answered that he took the same at the request of the accused as the accused told him that he can use the cheque if he fails to make the payment by 20.06.2015 and also because the accused is a truck driver and is mostly out of town.
21. Testimony of CW2, Sh. Manoj Kumar: The said witness in his examination in chief deposed that he has known the complainant and the accused for the last ten to twelve years and that both of them resided in the same village. He avouched that in the month of December, 2014 the complainant sold a vehicle bearing no. HR55N7144 to the accused for a sale consideration of Rs 9 lakhs. Out of which, Rs New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 3,68,000/ was given in cash and Rs 5,32,000/ was to be paid by way of a cheque. Manoj Kumar further testified that the cheque was given by the accused to the complainant in his presence and that all the particulars were duly filled. He further avowed that it was agreed that the entire payment shall be made after getting the vehicle transferred in the name of the accused. He lastly claimed ignorance about the fact whether the vehicle was transferred or not or whether the cheque was encashed.
22. The witness first subjected to crossexamination wherein he inter alia deposed that the cheque was given between 01.12.2014 to 15.12.2014 and was handed over around 11.00AM to 11.30 AM. He deposed that he is in the service of Delhi Police. He avouched that he did not remember whether on the said date when the cheque in question was given to the complainant, he was on leave or not. He testified that the complainant told him about the factum of dishonour of the cheque in 2015. However, he claimed that he did not remember the exact month or date. The witness further testified that he did see that the cheque in question was completely filled when it was handed over to the complainant and the same was drawn on Central bank having all the particulars filled except the date. He further avowed that the complainant did check as to whether the cheque in question was duly filled or not. He deposed that apart from the cheque in question, no other document was executed at that time. He admitted that the aforementioned vehicle was not transferred before the cheque was handed over. The witness stated that he can neither confirm nor deny the suggestion if the aforementioned vehicle was transferred in the name of the accused in the month of September, 2014. He further stated that the cash received by the complainant was used in the bypass surgery undergone by the complainant. Lastly, he stated that he did not know as to who wrote the date in the cheque in question.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
23. The complainant closed his evidence on 04.08.2016 without calling and examining any further witness.
24. Examination of the accused under section 313 Cr.P.C.: The accused was examined under section 313 Cr.P.C by the court on 04.08.2016 wherein he inter alia stated that he purchased one vehicle bearing no. HR55N7144 in the year 2011 but that the said vehicle was purchased in the name of the complainant as the accused stated that he was a defaulter in respect of payments of installments for the vehicle previously purchased by him. The accused admitted that he has known the complainant for the last fifteen years and that the two belong to the same village. The accused his denied his liability towards the complainant and stated that the latter has misused his cheques which was in his possession. He explained that he gave certain blank signed cheques to the complainant because the complainant was apprehensive in case he fails to make payments of the aforementioned vehicle. The accused admitted receiving the legal demand notice by his family members. He admitted his signatures on the cheque in question but denying filling the particulars therein.
25. Defence Evidence: The accused got himself examined as a witness u/s 315 Cr.P.C and inter alia deposed in his examinationinchief that he has known the complainant for the last fifteen to twenty years. He avouched that he had taken a truck from the complainant and used to regularly pay installments. The accused testified that he had issued certain cheques in his favour. He also stated that he wanted to run a transport business in the name of the complainant and had purchased the truck in the name of the latter. The accused testified that in the month of September, 2014, he had paid all the installments and that the ownership of the truck was transferred in his name. The accused New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 filed the copy of the RC of the abovmentioned vehicle. The same is Ex. DW1/1 (OSR). He also filed the photocopies of the permits which are Ex. DW1/2 (OSR) and Ex. DW1/3 (OSR) respectively.
26. The accused was subjected to crossexamination wherein he inter alia deposed that he is an illetrate. The accused admitted that vehicle no.HR55N7144 was in the name of the complainant. He stated that the complainant purchased the same in the month of July, 2011. He avouched that he did not remember as to how much consideration did he give to the complainant and voluntarily stated that he had given Rs 3 lakhs to the complainant and that Rs 61,000/ was the installment amount. He deposed that the complainant had to pay 35 installments in three years and that the last installment was to be paid in the month of July, 2014. He stated that he cannot produce any documentary proof to show that he has to paid any installment amounting to Rs 61,000/ from his account. The accused voluntarily clarified that he used to remit the said sum in the account of the complainant in cash. He stated that he can produce two receipts in respect of such remittance but admitted that he has not filed any such receipts on record. He further avowed that the complainant never defaulted in paying the installments. He admitted that he took a loan pursuant to purchasing the above mentioned vehicle from the complainant. The witness was shown Ex. DW1/3 and was asked whether he can tell if any date is mentioned thereon. The witness answered that he cannot read the said document. He admitted that Ex. DW1/3 shall expire in the year 2019 and that it has been in effect since 2014.
27. The accused was recalled for further crossexamination wherein he inter alia deposed that he did not get any police complaint lodged against the complainant. He New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 stated that he is not aware as to how many documents were got signed by the complainant in respect of the transfer of the vehicle. He stated that the complainant signed the same at the time of purchasing the said vehicle. The accused admitted that he had given the cheque in question to the complainant. He stated that he has not produced any documentary proof to show that he had paid in installment to the complainant. Lastly, he stated that he gave the cheque in question to the complainant in the year 2011 and hence, he cannot avouch whether he had sufficient funds at the time when the cheque was presented.
28. Without examining any further witness, the accused closed his evidence on 07.11.2017.
29. Final Arguments: Learned counsel for the complainant, Mr. Ishwar Singh, argued that the entire case of the complainant has been admitted by the accused in his crossexamination. He contended that the accused has not brought any probable defence to impeach the case of the complainant. Also, since no police complaint has been filed by the accused, any alleged misuse of the cheque in question cannot be presumed. In light of the presumptions in favour of the complainant, his case stands proved beyond reasonable doubt. The complaint, being within limitation, has been successfully proved by the complainant and hence, the accused is liable to be convicted.
30. Per contra, learned counsel for the accused, Mr. Manoj Yadav, argued that the cheque has been misused by the complainant and that the accused owes no liability in respect of the same. He further argued that the vehicle was purchased in the year 2011 by the accused in the name of the complainant but the accused regularly paid all the installments. The installments were duly paid by the accused and the liability was New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 discharged in the month of July, 2014 whereafter, the ownership of the vehicle was transferred in the name of the accused. Learned counsel argued that the cheque was given merely for the purpose of security and was a blank, signed one. The same was given at the time of purchasing the vehicle. Learned counsel relied on the RC filed by the accused in support of his case. In light off his submissions, learned counsel averred that the case of the prosecution is a false and fabricated one and hence, the accused is entitled to be acquitted.
31. I have heard both the learned counsel; pursued the material on record and considered the submissions advanced.
32. Appreciation of evidence and finding: Now coming to the merits of the case, I first deem it pertinent to enunciate the law relating to dishonour of cheque.
33. To bring home a liability under section 138 of The Negotiable Instruments Act, 1881, following elements must spring out from the averments in the complaint and the evidence adduced by the complainant, viz,
1. A person must have drawn a cheque on an account maintained by him in a bank for payment of a certain sum of money to another person from out of that account for the discharge of any legally enforceable debt or liability;
2. The cheque has been presented to the bank within a period of three months from the date mentioned on the cheque or within the period of its validity, whichever is New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 earlier;
3. The cheque is returned by the bank unpaid, either because 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;
4. 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;
5. The drawer of such cheque fails to make the payment to the payee or the holder in due course of the cheque within 15 days of the receipt of the notice.
34. It becomes imperative to mention section 139 of The Negotiable Instruments Act, 1881 which carves out a presumption in favour of the drawee that the cheque was issued to him in discharge of a debt or other liability of a legally enforceable nature. Also, the said provision must be read along with the section 118 of the same enactment which spells out another presumption in favour of the drawee that every negotiable instrument was drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;
35. Since criminal liability can be attached by proving each element of the section under which liability is sought to be enforced, I shall now go on to appreciate the New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 evidence documentary and oral, in light of how compellingly it satisfies each of such ingredient, if at all.
36. As the presumption under section 139 NI Act lies in favour of the complainant, the accused was encumbered with the onus to prove that the cheque in question was not given towards any debt or liability or was not issued for consideration. Thus, the onus to prove the contrary lies on the accused.
37. That said, what follows from the above is that the web of proof in a trial under section 138 NI Act is structured on the premise of the reverse onus of proof theory since the offence is a document based technical one. The journey of evidence in a trial under section 138 NI Act thus, begins not from the home of the prosecution story but from the point of the defence. The presumptions carved out in favour of the complainant are those of law and not those of fact. The court is obligated to draw presumptions and only when the contrary are proved by the defence, the same will be said to be rebutted. Whereas the standard of proof remains the same in such a trial, the reverse onus of proof on the defence is guided by the principle of preponderance of probabilities only. As rebuttal evidence, the accused merely has to prove that the cheque was not given for any consideration or that there was no legal liability in existence against him for which the negotiable instrument was given.
38. In this regard, reliance can be placed on Hiten P. Dalal v. Bratindranath Banerjee (2001) 6 SCC 16 wherein it was held as under:
"22. Because both Sections 138 and 139 require that the Court `shall presume' the liability of the drawer of the New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 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 nonexistence 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 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 New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 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."
39. The first condition pertains to the issuance of the cheque in question to make the payment from an account maintained by the drawer of the cheque towards a legally enforceable debt or other liability. In the present case, the accused has admitted the issuance of the impugned cheque in favour of the complainant during his examination under section 313 Cr.P.C. as well as during his crossexamination but has stated that the same has been misused by the complainant to whom the impugned cheque was given as a security. Allegedly, the said cheque was given as security as the complainant was apprehensive that the accused might commit default in the payment of installments of the loan taken by the former on behalf of the accused to purchase a truck.
40. The accused has admitted his signatures on the cheque in question. Now, the contention of the accused is that he had given the same as security to the complainant and has maintained so throughout the course of trial. To substantiate the said claim, the accused attempted to prove that the cheque is an outdated instrument as in the year 2010, the Central bank issued a directive that the cheque shall bear the name of the account holder thereon. Since the impugned cheque does not bear any such name of the accused, hence, it can be presumed that the same was given prior to the year 2010 and has been misused.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
41. For the sake of argument if one were to assume that the cheque in question was given as security, as alleged by the accused, then two pertinent questions may born out of reasonability one, why did the accused not demand, by way of a written notice, the cheque in question back from the complainant which he alleges to have given as security despite the fact that he had allegedly paid all the installments of the loan taken by the complainant. Merely stating that the cheque was given as security shall not suffice either to obscure the story put forth by the prosecution or to cause the probabilities to lie in one's favour. The second question that would surface from the womb of reasonability is that why did the accused not file any complaint either with his bank or with the police?! The failure to lodge/file any complaint further causes dubiety to lurk around the story of the defence. An adverse inference can safely be drawn against the accused who has otherwise failed to adduce any affirmative evidence to show that he indeed did everything within his power and control, as a prudent man would do, to ensure that the cheque tendered by him, allegedly as security, was not misused. Failure of the accused to prevent such alleged misuse, in light of the attending circumstances of the case, materially ejects plausibility out of the defence version.
42. Reliance can safely be placed on the judgment pronounced by the Hon'ble Parent High Court in V.S. Yadav v. Reena CRL. A. NO. 1136 Of 2010 wherein it was held that:
"Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under Section 139 of N.I. Act. If mere statement under Section 313 Cr. P.C. or under Section 281 Cr. P.C. of accused of pleading not guilty was sufficient to New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 rebut the entire evidence produced by the complainant/ prosecution, then every accused has to be acquitted. But, it is not the law. In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption u/s 139 N.I. Act. If no loan was given, but cheques were retained, he immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he would have served a notice as complainant. Nothing was proved in this case."
43. Even if the cheque was presumably given as security, the same will not fall out of the purview of section 138 NI Act and liability shall entail against the accused in case all other attending circumstances are proved against him. The accused himself asserted during his examination under section 313 Cr.P.C. that the complainant took the cheque from him allegedly for the purpose of security as the former was apprehensive that the accused might commit default in the payment of the installments. Thus, since the cheque was given for the purpose of securing the debt, the same was duly presented to revcover the same in the eventuality of the default on the part of the accused.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
44. This view has been endorsed by the Hon'ble Parent High Court in Credential Leasing and Credits Pvt. Ltd. Vs. Shruti Instruments and Another, CRL.L.P.558/2014. The relevant paragraphs of the said judgment are reproduced below: "Property etc. deposited or pledged by or on behalf of a person as a guarantee of the fulfillment of an obligation (as an appearance in court or the payment of a debt) and liable to forfeit in the event of default".
59. Thus, when one party gives a security to the other, implicit in the said transaction is the understanding that in case of failure of the principal obligation, the security may be enforced."
It has been further held that:
"61. Thus, in my view, it makes no difference whether, or not, there is an express understanding between the parties that the security may be enforced in the event of failure of the debtor to pay the debt or discharge other liability on the due date. Even if there is no such express agreement, the mere fact that the debtor has given a security in the form of a post dated cheque or a current cheque with the agreement that it is a security for fulfillment of an obligation to be discharged on a future date itself, is sufficient to read into the arrangement, an agreement that in case of failure of the New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 debtor to make payment on the due date, the security cheque may be presented for payment, i.e. for recovery of the due debt. If that were not so, there would be no purpose of obtaining a security cheque from the debtor. A security cheque is issued by the debtor so that the same may be presented for payment. Otherwise, it would not be a security cheque."
45. The Hon'ble Supreme Court, in the above mentioned case, relied on its earlier decision pronounced in V.K. Ashokan v. CCE, (2009) 14 SCC 85 wherein it has been held as under:
"The term "security" signifies that which makes secure or certain. It makes the money more assured in its payment or more readily recoverable as distinguished from, as for example, a mere IOU, which is only evidence of a debt, and the word is not confined to a document which gives a charge on specific property, but includes personal securities for money. (See Chetumal Bulchand v. Noorbhoy Jafeerji, AIR 1928 Sind 89). It is a word of general import signifying an assurance".
46. Thus, there is no merit in the assertion of the defence that the impugned cheque was given merely as security and hence, no liability could ensue against the accused in respect thereof.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
47. Lastly, the accused has also stated that the cheque was given without filling the particulars therein. Now, in such a scenario, section 20 of The Negotiable Instruments Act comes into play which provides that when a person signs a negotiable instrument and delivers the same to another either wholly blank or after partially filling the same, he gives an authority to the holder thereof to write the same and becomes liable for the amount mentioned therein provided the said amount does not exceed the amount which the holder is liable to recover from the drawer. Thus, though the accused may have given an inchoate negotiable instrument to the complainant to discharge a legally enforceable debt, he will nonetheless be liable in view of the aforementioned provision.
48. Reliance can be placed on a judgment pronounced by the Hon'ble Parent High Court in M/S Anu Products Ltd. vs. M/S Raj Agro Tech & Anr. CRL.L.P. 612/2014 wherein it has been held that:
"26. In the present case, even if one were to accept that the cheque in question was a security cheque given as a blank signed cheque in respect of a future/contingent liability, that by itself would not be sufficient to non suit the complainant by holding that a complaint under Section 138 of NI Act is not maintainable. It was for the accused to set up a probable defence by raising a doubt with regard to the existence of liability or its quantification, as projected by the complainant. In the present case, the accused did not raise any such probable defence. The accused claimed to have made payments of Rs.10,000/ (apart from the initial security deposit of Rs.10,000/) on four other occasions. However, they were not substantiated by leading any credible evidence."
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
49. The third defence taken by the accused is that there was no existence of legal liability against him and in favour of the complainant company. Let us examine the potency of the said assertion. The version of the complainant is reinforced in light of the admissions made by the accused during the course of trial. The factum of purchasing the vehicle is as well as the transfer of ownership thereof in favour of the accused has been admitted. The parties are not in consensus as regards the same. The only pertinent question thus, remains regarding the payment of sale consideration. The complainant alleges that the accused issued the impugned cheque towards the partial discharge of his liability, whereas the accused has asseverated that he has paid the entire installments towards the loan taken by the complainant on his behalf to purchase the vehicle.
50. To substantiate the said defence, the accused has brought forth no documentary evidence to stand up for and bolster his defence. He stated during his cross examination that he is in possession of two receipts in respect of the payments made by him. However, despite opportunity, he failed to produce the said receipts. He also admitted the fact that he has filed no documentary proof to show that he paid any of the installments to the complainant.
51. Thus, the failure of the accused to produce the best evidence in his possession to corroborate his story makes his version murky and unreliable. The accused further testified that he remitted the payments in the account of the complainant. The accused could have summoned and examined a bank witness to fortify the said fact. However, his failure to examine such a witness attracts the provision of section 114 of the Indian Evidence Act which provides that the court may presume the existence of any fact New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 which it thinks likely to have happened having regard to the human conduct etc. in their relation to the facts of a particular case. One of the illustrations appended to the section provides that the court may presume that the evidence which could be and is not produced would, if produced by unfavorable to the person who withholds it.
52. Therefore, since the bank witness was not summoned and examined, it can be presumed that the accused did not adduce the relevant evidence for it was unfavorable to him. And in the absence of any evidence, much less reliable, this defence version is established to be unsubstantiated and thus, is unbelievable.
53. The case of the complainant further stands fortified by the testimony of CW2. The said witness lucidly stated that the impugned cheque was given by the accused to the complainant in his presence and that the particulars therein were duly filled except the date. Nothing incredulous was elicited from the testimony of the said witness in which case, there is no reason to disbelieve him.
54. Interestingly, the whole defence of the accused rests on the edifice that the complainant took loan on his behalf as, being a defaulter, the accused could not avail a loan facility himself. This imaginary defence falls flat in light of yet another admission of the accused during his crossexamination when he affirmed that he took a loan pursuant to purchase the vehicle from the complainant. If the accused were as much an incorrigible defaulter as he pleaded himself to be then how could he avail a loan facility later?! The accused failed to furnish any justification as to how, from a relentless defaulter, he became a principled debtor in the eyes of those who eventually granted him loan. This reasonable question causes the story of the defence to emit a stench of falsity and fakery.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
55. Now learned counsel for the accused argued that the RC Ex. DW1/1 of the truck so purchased bears his name as an owner and the same is dated 30.09.20114. It is the contention of the accused that the vehicle stood transferred in his name in the month of September, 2014 and not in the month of December, 2014 as alleged by the complainant. Since it is not in dispute that the transfer of ownership did take place between the parties, the date of such transfer, in any case, is irrelevant to the adjudication of the liability in question. Nonetheless, let us examine the potentiality of the said argument!
56. Perusal of the said document apparently reflects that the same is suspicious and cannot be relied upon in the wake of the fact that the entire details in the said document are printed whereas only the date mentioned therein is written in ink. The same defies logic as well as reason. The honesty, if at all, of the accused, should have propelled him to call and examine a witness from the transport department to concretely establish the factum of transfer with other collateral details in respect thereto. The entire chain of the devolving of the ownership of the vehicle from one person to another should have been cogently, unimpeachably and immaculately established by the defence to obscure the prosecution story which otherwise has been bricked by the presumptions of law.
57. The accused does not become entitled to an acquittal by taking advantage of escape hatches leading to gross miscarriage of justice in the garb that his personal liberty is at stake and hence, he must be given every benefit of doubt which to a prudent man is not a reasonable one. It does not appeal to logic and good conscience that a complainant legitimately engaging in a transaction, be deprived of his due share of New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 payment merely because the accused points out some stray feebleness which is otherwise suspicious after having boldly admitted the transaction during his crossexamination.
58. The defence of the accused cannot be probablised on such stray issues which otherwise have no bearing on the merits. There is no greater proof than an admission made on behalf of a party. A crisp and unequivocal admission dispenses with the necessity of proof of a fact. The accused has failed to show as to how the complainant is not entitled to the payment of the amount mentioned in the impugned cheque.
59. It has been further held in M/s Anu Products Ltd (supra) that:
"28. In my view, the conclusion drawn by the learned MM with regard to the facts is palpably wrong and the impugned judgment is likely to result in grave miscarriage of justice. The approach of the Trial Court in dealing with the case is patently illegal and the impugned judgment is manifestly unjust and unreasonable. The Trial Court has ignored the evidence and misread the material evidence while coming to its conclusion that the accused had raised a probable defence. Merely because there may have been a confusion in the mind of the appellant/complainant with regard to the Sl. No. of the cheque by which the initial security deposit of Rs.10,000/ was made (on account of the incorrect cheque number recorded in the Distributorship Agreement Ex.CX1), and merely because the cheque in question may have been the one given as a blank signed cheque towards security for New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 supply of goods on credit basis, the Trial Court could not have come to the conclusion that the accused had set up a probable defence. As held by this Court in Ravi Chopra (Supra), and by the Punjab & Haryana High Court in Gurmeet Singh (Supra), the fact that a blank signed cheque had been issued by the drawer, which had subsequently been filled up by the holder, is not a ground to hold that the complaint under Section 138 NI Act would not be maintainable. The Trial Court should have examined whether on merits, the claim made by the appellant/complainant was in respect of an ascertained and crystallised amount, and whether the accused had been able to raise a doubt with regard to the existence of its liability and its quantification. In my view, the learned MM was unduly swayed by the fact that the cheque in question was a blank signed cheque given at the time of execution of the distributor agreement Ex. CW1, and not subsequently, and that the said blank signed cheque had been used by the appellant to realise its outstanding dues. The respondents have not been able to raise a probable defence either by showing that there was no debt due under the Dealership Agreement (Infact debt to the extent of Rs.45,000 46,000 was also admitted), or by showing that the quantification of the debt was fallacious and not in accordance with the dealership agreement. The New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 defence that the respondents had made payment of Rs.52,000/ in the aggregate is nothing more than the ipse dixit of the respondents. The same is not substantiated by evidence. The advance cheque was given precisely for the purpose of realising the outstanding dues, and it was used for the said purpose only."
60. The facts of the present case squarely fall within the same circumference as are the facts of the case in M/s Anu Products Ltd (supra). Thus, it can be safely inferred that by not challenging the quantification of the liability or the existence of liability towards the amount mentioned in the cheque in question, the accused failed to raise a probable defence in the present case.
61. Therefore, considering the weight of the attending circumstances viz, the consistency in the prosecution story, the compelling documentary evidence adduced by the complainant, admissions on the part of the accused and lastly, that the accused has not proved his defence to cause the probabilities to lie in his favour, the first element of section 138 NI Act stands assembled.
62. As for the second condition qua the presentation of the cheque within three months, the same is satisfied upon the perusal of the cheque in question, Ex. CW1/1 dated 20.06.2015 and the return memo Ex CW1/2 which is dated 24.06.2015, thus, being presented within prescribed period of limitation of three months. The defence did not to adduce any evidence whatsoever to contradict the same.
New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29
63. The third condition pertains to the return of the cheque as unpaid owing to it being dishonoured. Section 146 of The Negotiable Instruments Act, 1881, in this regard comes into play which raises a presumption that the court shall presume the fact of dishonor of the cheque in case the cheque is returned vide a return memo having thereon the official mark denoting that the cheque has been dishonoured. Such bank slip or memo is a prima facie proof of dishonor. At the cost of repetition, the defence has failed to rebut the said presumption as well. Hence, the condition is fulfilled.
64. As far as the making of demand by sending a legal notice is concerned, the complainant had sent the same, Ex. 1/3, to the accused who chose not to reply to the same. There is a crisp admission during the examination under section 313 Cr.P.C. that the accused received the legal demand notice thus, implying the satisfaction of the fourth condition.
65. The last condition is that the accused fails to make the payment within fifteen days from the date of the receipt of the legal demand notice. In the present case, the accused has evidently failed to make the payment within fifteen days on the pretext that he owes no liability towards the complainant. However, he has miserably failed to prove the said assertion. Thus, the last limb of what will entail the liability against the accused is also structured.
66. Ratio: Finally, having considered the totality of the facts and circumstances of the case, the presumption spelled under section 139, the law enunciated under section 138 and the judgments cited above, the offence under section 138 of The Negotiable Instruments Act, 1881 is made out against the accused, Sunil. The weight of the evidence New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29 adduced by the complainant to prove his case against the accused is sufficient enough to impute criminality on him. The complainant has discharged his burden to prove his case against the accused beyond all reasonable doubt. The accused is accordingly, convicted of the said offence.
67. Let the copy of this judgment be given to the convict free of cost.
Digitally signedPARIDHI by PARIDHI GUPTA GUPTA Announced in the open court Date: 2018.03.26 13:57:16 +0530 today i.e. 24.03.2018.
Paridhi Gupta MM/N.I.Act02/South West Dwarka, Delhi New CC No.: 4991579/16 Raj Kumar versus Sunil 27/29