Delhi District Court
Gurcharan Dass vs ) M/S Sambhav Chit Fund Pvt. Ltd on 8 August, 2018
IN THE COURT OF SH. ANIL KUMAR SISODIA : ASJ 04
EAST DISTRICT : KARKARDOOMA COURTS : DELHI
Criminal Appeal No. 188/17
Gurcharan Dass,
S/o Sh. Dwarika Dass,
R/o P1/A5, Dilshad Garden,
Delhi - 110095. .....Appellant/Convict
Vs.
1) M/s Sambhav Chit Fund Pvt. Ltd.,
Having its registered office at
Flat No. 209, Navniti Apartments,
51, I.P.Extension,
Delhi110092.
2) The State (Govt. of NCT of Delhi). ..... Respondents
Arising out of matter :
CC No. 52972/16
PS Mandawali
u/s 138 N.I.Act
Date of Institution of appeal : 27.11.2017
Date of reserving order : 13.07.2018
Date of pronouncement : 08.08.2018
Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 1 of 12
JUDGMENT
1. The present appeal has been directed against the judgment and order on sentence dated 31.10.2017 vide which the appellant was convicted by Ld. Trial Court for an offence u/s 138 NI Act and was sentenced to Simple Imprisonment for a period of one month and also to pay fine amount of Rs. 3,00,000/, which was to be paid as compensation to the complainant. In default of payment of fine appellant was further liable to undergo Simple Imprisonment for a period of one month.
2. Briefly stated, facts necessary for disposal of this appeal are that respondent no. 1 /complainant had filed a complaint u/s 138 NI Act against the appellant / convict stating that appellant was member of certain chits of the respondent no. 1/complainant but became irregular in payment and after much persuasion, he issued three cheques bearing nos. 360458, 360459 & 360460, amounting to Rs. 39,525/, Rs. 65,875/ and Rs. 51,750/ respectively for discharging his liability. However, when the aforesaid three cheques were presented to the bank the same were returned unpaid with remarks "Funds Insufficient". The respondent no.1/complainant served a legal notice on the appellant demanding the amount but appellant failed to pay the same. Respondent no. 1 led presummoning evidence and thereafter the appellant was summoned and notice u/s 251 Cr.P.C. was served on Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 2 of 12 him to which he pleaded not guilty and claimed trial. Respondent no. 1 examined its Director Sh. N.C.Jain and closed its evidence. Statement of the appellant was recorded u/s 313 Cr.P.C. and thereafter appellant examined himself as DW1 in his defence evidence. He also examined DW2 Sh. R.K. Mittal, SWO Canara Bank, Dilshad Garden and thereafter DE was closed. After hearing final arguments, ld. Trial Court convicted the appellant and sentenced him as stated herein above.
3. Aggrieved by the impugned judgment and order on sentence, appellant preferred the present appeal on the following grounds :
i)That Ld. Trial Court did not appreciate the fact that the cheques were given as security and all the payments were made by way of cash as well as cheques by the appellant to the respondent no. 1.
ii) Ld. Trial Court did not appreciate the fact that the amount in the cheques were filled in either by the complainant or his associate.
Iii) Ld. Trial Court ignored the fact that respondent no. 1 nowhere mentioned about the liability of the appellant towards respondent no. 1 in the trial court. The perusal of legal notice dated 11.07.2005 issued on behalf of respondent no. 1 does not disclose any amount and no statement of account was filed by the respondent no. 1 till 27.10.2017. Respondent no. 1 filed Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 3 of 12 uncertified unsigned statement of account which is neither verified nor signed or acknowledged.
iv) That Ld. Trial Court ignored the settled law that if two views are possible, the view which is beneficial to the accused should be adopted.
v) Ld. Trial Court also ignored the fact that there is no valid legal service of the notice.
vi) Ld. Trial Court ignored the fact that appellant had already made the payment to respondent no. 1 but respondent no. 1 did not return the cheques issued by way of security and misused the same.
Vii) Ld. Trial Court also did not appreciate the fact that appellant is a senior citizen and suffering from high BP and is unemployed.
Viii) Ld. Trial Court did not appreciate the evidence correctly and has not given the benefit of doubt to the accused/appellant.
A prayer was made for setting aside the judgment and order on sentence dated 31.10.2017 and for acquitting the appellant.
4. The appellant filed an application praying for suspension of sentence and grant of bail, which was granted to him vide order dated 30.11.20017 subject to his deposit of cheque amount of Rs. 1,65,000/. The accused/appellant failed to fulfill the condition of suspension of sentence and accordingly he was taken into custody on 24.01.2018 and Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 4 of 12 was released on 26.03.2018 (i.e after about two months of custody).
5. Notice of the appeal was issued to the respondents. The respondent no. 1 appeared and contested the appeal. Trial Court record was also requisitioned prior to hearing the final arguments on the appeal.
6. I have heard ld. Counsel for the appellant as well as counsel for respondent no. 1 and have perused the record carefully.
7. Ld. Counsel for the appellant has argued on the lines of the pleadings in the appeal and has submitted that the appellant was not served with the legal notice. The legal notice does not give the details of the chit numbers, amount of installments, amount paid and amount due and outstanding. He further submitted that respondent no. 1 did not file any statement of account. He also submitted that the cheques in question were given as security which have been misused by the respondent no. 1. The appellant appeared as a defence witness and has submitted that he has made the entire payment. The official of the Canara Bank was also examined by the appellant as DW2 who has proved on record the statement of account of the accused as Ex. DW2/A and the letter written by the appellant to the Manager as Ex. DW2/B. The statement of account produced by the witness on 22.02.2017 has been proved as Ex. DW2/C. It has been argued that Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 5 of 12 nothing was due towards the respondent no. 1 and respondent no. 1 was not entitled to any relief. Respondent no. 1 did not issue any receipt of cash payment made by appellant.
Counsel for the appellant also placed on reliance of the judgment of
(i) Gorle S. Naidu Vs State of A.P. & Ors, 2001 (1) Crimes 212 (SC) wherein it is held that "In a criminal case if two views are possible on evidence adduced in the case, one pointing to innocence of accused should be adopted.".
(ii) Rahman Vs The State of U.P., AIR 1972 Supreme Court 110 wherein it is held that "The circumstances forming evidence must be conclusively established and even when so established, they must form such a complete chain that it is not only consistent with the guilt but is inconsistent with any reasonable hypothesis of innocence"
(iii) Akhilesh Hajam Vs State of Bihar, 1995 (2) C.C. Cases 122 (SC) wherein it is held that "Howsoever, strong emotional consideration may be but the same cannot take the place of proof.".
(iv) Jagga Singh Vs State of Punjab, AIR 1995 Supreme Court 135 wherein it is held that " Suspicion, however, is no substitute for proof; and in criminal law the prosecution has to prove the guilt beyond reasonable doubt".
(v) Ram Swaroop & Ors. Vs State of Rajasthan, IAR 2004 Vol. II/I Supreme Court wherein it is held that "The court ought to incline Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 6 of 12 itself towards the view favouring accused if two contrary view are possible".
8. Counsel for respondent no. 1 has vehemently defended the judgment and order of sentence passed by Ld. Trial Court. It has been argued that appellant has admitted that he was the member of the Chit of respondent no. 1 company. He has also admitted that the cheques in question were issued by him and has not denied his signatures on the cheques. It has been further argued that once the appellant admitted the issuance of cheques and its dishonour, the appellant is under an obligation to rebut the presumption which has arisen u/s 139 NI Act against him. He also argued that the legal notice was duly served on the appellant and AD card duly acknowledged has been proved by the CW1 on record. The appellant has not disputed his address mentioned on the legal notice. Hence, the legal notice is duly served on the appellant. All other arguments advanced by the counsel for the appellant have been refuted by the counsel for respondent no. 1 and prayer has been made for dismissal of the appeal.
9. At the outset, it is pertinent to note that the appellant has admitted the fact that he had subscribed to three chits run by the complainant company namely SCF05, SCF06 & SCF07. He also admitted the documents Ex. DW1/C1 to Ex. DW1/C12 which are the chit agreements, demand promissory notes, receipts. He also admitted Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 7 of 12 that he had issued three cheques to the complainant Ex. CW1/1 to Ex. CW1/3 which were issued from his proprietorship concern. The dishonour of these cheques for the want of funds is also not in dispute. The respondent no. 1 had filed the complaint on the basis of the aforesaid three cheques. Hence, a presumption u/s 139 NI Act is raised against the appellant. The presumption mandated by Section 139 of NI Act does indeed include the existence of legally enforceable debt or liability. This presumption is ofcourse in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of legally enforceable debt or liability can be contested.
10. In his defence, appellant raised a plea that the cheques were issued as security and that he had given blank signed cheques to the respondent no. 1 which have been misused. He also raised a plea that he had made all the payments through cheques and cash. Another plea which was raised by him was that he had not received the legal notice.
11. Ld. Counsel for appellant has contended that the respondent no. 1 did not mention about the liability in the legal notice or in the complaint nor mentioned about the same in evidence by way of affidavit. However, in view of the admissions made by appellant in his evidence, I am of the considered opinion that the appellant was Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 8 of 12 well aware about the factual position. He was aware about the amount of the chits subscribed by him, number of installments in which the chit amount was to be repaid and the number of installment on which each chit was taken by him. Perusal of the complaint itself shows that respondent no. 1 has claimed the amount of the cheques dishonoured in the prayer clause of the complaint. Hence, this argument advanced by the counsel for appellant is accordingly rejected being devoid of any merits.
12. Another defence which was raised by the appellant was regarding the complete payment made by him to respondent no. 1 and misuse of the cheques which were purportedly deposited as security. Appellant has not been able to prove on record by way of cogent evidence that he had deposited these cheques as security. No witness has been examined by him to prove this fact nor he has placed on record any documentary evidence to show that the cheques were deposited as security. Similarly no evidence has been led by the appellant to prove that he had made complete payment to respondent no. 1, except a bald statement made during the course of his evidence. In fact, appellant admitted in his cross examination that these facts were within the knowledge of Mr. Chander Prakash and Mr. Gulshan Kumar but none of these persons were examined by him to prove these facts. No reasons have been given by the appellant as to why he has not produced these witnesses. In the absence of any cogent Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 9 of 12 explanation coming from the mouth of the appellant, an adverse inference has to be drawn against the appellant that had these witnesses appeared in the witness box, they would have not supported the defence raised by him. The appellant has also not placed on record any receipts for the cash payments made by him towards discharge of his debt or liability. He has simply stated that respondent no. 1 did not issue the receipt despite requests being made. It is surprising as to why appellant kept on making cash payments when no receipts were being issued by respondent no. 1 despite his repeated requests. He did not even care to issue notice to respondent no. 1 to demand the receipts for the cash payments made by him. The conduct of the appellant is not a conduct of an ordinary prudent person and the same cannot be safely relied upon. The appellant has thus failed to prove that he had made the complete payment to respondent no. 1.
13. The contention of the appellant that he had issued blank signed cheques to the respondent no. 1 and they were misused by respondent no. 1, is also without any merits. Section 20 of NI Act gives general authority to a person to whom an incomplete negotiable instrument has been given to complete it in favour of any person besides himself. In Pandurang Vs Babu Lal, III (2010) BC 586 (Bom) it was held that whenever an incomplete negotiable instrument is handed over the drawer prima facie gives authority to the holder thereof to complete the negotiable instrument. Hence, filling of the cheques by the Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 10 of 12 Director of respondent no. 1 or any other persons is immaterial.
14. Another defence raised by the appellant is regarding non receipt of legal notice. At the outset it may be noted herein that respondent no. 1 has proved the legal demand notice (Ex. CW1/5) was sent by registered post as well as UPC and the same was duly served on the address of the appellant vide AD Card Ex. CW1/8. The appellant in his cross examination dated 28.10.2017 has admitted that the address mentioned in the notice Ex. CW1/5 was his address. In fact in his appeal, same address has been mentioned by the appellant. Thus, in view of Section 27 of General Clause Act a presumption arises regarding service of notice on the appellant and it was for the appellant to show that he was not served with the legal notice. The appellant has not placed on record any material to rebut the presumption. Hence, it cannot be said that the appellant was not having knowledge about the legal notice being issued to him. In the absence of any evidence led by the appellant to rebut the presumption, the legal notice is deemed to have been served on the appellant. Ld. Trial Court has rightly placed reliance upon the judgment of Hon'ble Supreme Court in C.C. Alavi Haji v. P. Mohammad (2007) 6 SCC 555 regarding service of notice on the appellant.
15. Therefore, in view of the aforesaid discussion, I am of the considered opinion that appellant has failed to point out any illegality Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 11 of 12 or infirmity in the judgment and order on sentence passed by the Ld. Trial Court. Ld. Trial Court has rightly convicted the accused/appellant under Section 138 NI Act. The sentence imposed by the Ld. Trial Court is also reasonable and it cannot be termed as harsh or unreasonable. In fact, Ld. Trial Court has taken a liberal view and awarded lenient punishment to the appellant which does not warrant any interference by this court.
16) Accordingly, the judgment and order on sentence dated 31.10.2017 passed by Ld. Trial Court is reaffirmed and the appeal stands dismissed. The appellant has already undergone simple imprisonment for a period of two months during the pendency of the present appeal. Hence, he is given benefit of Section 428 Cr.P.C. Bail bonds of the convict/appellant stands cancelled.
TCR be sent back forthwith alongwith copy of this judgment. Appeal file be consigned to Record Room after due compliance.
Digitally signed by ANIL KUMARANIL KUMAR SISODIA Location: Karkardooma Courts, SISODIA East District, Delhi Date: 2018.08.08 15:17:13 +0530 Announced in the open court (ANIL KUMAR SISODIA) On 8th day of August, 2018 ASJ04, EAST DISTT. KKD COURTS/DELHI Crl.(A) No.188/17, Gurcharan Das Malhotra Vs. M/s Sambhav Chit Fund P.Ltd. & Ant. Page 12 of 12