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[Cites 28, Cited by 0]

Delhi District Court

Jasbir Singh vs State Of N Ct Of Delhi And Anr on 3 May, 2024

            IN THE COURT OF SPECIAL JUDGE (NDPS),
          SHAHDARA, KARKARDOOMA COURTS, DELHI


     Criminal Appeal No. 61/2024

     In the matter of :­

     Jasbir Singh
     S/o Late S. Tarsem Singh,
     R/o 2/77, Lalita Park,
     Laxmi Nagar, Delhi - 110092.
                                                         .......... Appellant

                                           Versus

     1. The State of NCT of Delhi
        through APP

     2. Kiran Talwar
        W/o Rajeev Kumar
        R/o CR­5/217, Lalita Park,
        Laxmi Nagar, Delhi - 110092.
                                                     .......... Respondents

         CRIMINAL APPEAL UNDER SECTION 374 OF THE
             CODE OF CRIMINAL PROCEDURE, 1973

             Date of institution                     :       28.03.2024
             Date when judgment reserved             :       05.04.2024
             Date of Judgment                        :       03.05.2024

     JUDGMENT:

­

1. This appeal impugns judgment dated 16.02.2024 and order on sentence dated 26.02.2024 passed by the Ld. ACMM, Criminal Appeal No.61/2024 Page 1 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 Shahdara, Karkardooma Courts, Delhi by which appellant Jasbir Singh was found guilty for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (in short "the NI Act") and was sentenced.

2. Brief facts as borne out from the trial court record are that complainant Ms. Kiran Talwar (respondent no. 2 herein) had filed a complaint case under Section 138 of the NI Act against accused Jasbir Singh (appellant herein). It was averred in the complaint that appellant/accused was having good friendly relations as well as neighbouring terms with the respondent no. 2/complainant. In April 2016, the appellant/accused approached the respondent no. 2/complainant for a loan of Rs.4,00,000/­ to start a PG girls hostel. The respondent no. 2/ complainant arranged Rs.4,00,000/­ and lent the said amount in cash to the appellant/accused to be repaid with interest @ 24% per annum. A loan agreement dated 28.04.2016 was also executed between the parties and the appellant/accused assured the complainant/respondent no. 2 to return the said amount within two years. The appellant/accused has also issued a security cheque bearing no. 645614 dated Nil drawn on SBI Bank for Rs.4,00,000/­ in favour of complainant against the receipt of said loan amount. After expiry of the stipulated time, the complainant/respondent no. 2 requested the appellant/accused to return the said amount but of no avail. Ultimately, after follow ups and several requests, the appellant/accused filled the date on the said aforesaid cheque on 16.05.2018 and on the direction of Criminal Appeal No.61/2024 Page 2 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 the appellant/accused, the complainant/respondent no. 2 presented the said cheque in her bank but the same was returned unpaid on account of insufficiency of funds vide returning memo dated 16.05.2018. The complainant intimated the said fact to the appellant through a legal demand notice dated 29.05.2018 and demanded the payment of the dishonoured cheque but to no avail. Therefore, the complainant was compelled to file the complaint case u/s 138 of NI Act.

3. Pursuant to service of summons, the appellant/accused appeared before the Ld. Trial Court and notice under Section 251 Cr.P.C. was served upon him on 31.05.2019 to which he pleaded not guilty and claimed trial.

4. The respondent/complainant in order to prove her case examined herself as CW­1 and relied upon the following documents : ­

1) Original cheque in question as Ex.CW1/1.

2) Returning memo dated 16.05.2018 as Ex.CW1/2

3) Legal demand notice dated 29.05.2018 as Ex.CW1/3 4) Postal receipt as Ex.CW1/4

5) Loan agreement along with copy of Aadhar card of appellant/accused as Ex.CW1/5­A.

5. The complainant also examined Sh. Vikram Talwar as CW­2 who is the witness to loan agreement Ex.CW1/5­A and filed his evidence by way of affidavit Ex.CW2/A. Criminal Appeal No.61/2024 Page 3 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024

6. After closing of evidence of the respondent no. 2/complainant, statement of the appellant/accused was recorded under Section 313 Cr.P.C. wherein he stated that he had taken Rs.1,50,000/­ from the complainant for some personal use and not for PG and issued the cheque in question towards security to the complainant and did not hand over dully filled up cheque. He further stated that his signatures were obtained on blank papers upon which the loan agreement was made by the complainant subsequently. He further stated that he had not returned the said amount of Rs.1,50,000/­ to the complainant. He further stated that the complainant lends money to people and several other cases are filed by her against other people.

7. The accused chose to lead evidence in his defence and examined himself as DW1 on oath under Section 315 of Cr.P.C.

8. The Ld. Trial Court vide judgment dated 16.02.2024 found appellant/accused Jasbir Singh guilty for commission of offence punishable under Section 138 of the NI Act and vide order dated 26.02.2024 sentenced him to imprisonment for 05 months along with compensation of Rs. 6,00,000/­ payable to the complainant within a month and in default to further undergo simple imprisonment for 03 months.

9. Aggrieved by the impugned judgment and order on sentence, the present appeal has been filed by the appellant/accused on the following grounds :­

(a) That the Ld. MM has failed to appreciate the fact that the Criminal Appeal No.61/2024 Page 4 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 respondent no.2 had placed on record a forged loan agreement.

(b) That the Ld. MM has failed to appreciate the fact that the respondent no.2 and her husband were money lenders and they were not having any licence for imparting loan on interest and thus the transaction of loan had become an illegal transaction and there was no legally enforceable liability.

(c) The Ld. MM has failed to appreciate the fact that the appellant had never taken any loan from the respondent no. 2/complainant, rather he had taken loan of Rs.1,50,000/­ from husband of the respondent no.2/complainant which had been paid and he had never any interaction with respondent no. 2 at any point of time.

(d) The Ld. MM has failed to appreciate that any loan transaction over and above Rs.20,000/­ in cash is illegal transaction u/s 269 SS of Income Tax Act.

(e) The Ld. MM has failed to appreciate the contentions raised by the Counsel for the appellant at the time of final arguments and also misinterpreted the judgments produced before him.

(f) The Ld. MM has failed to appreciate the material contradictions in the statement of complainant and her witness.

(g) The Ld. MM has failed to appreciate the fact that the Criminal Appeal No.61/2024 Page 5 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 respondent no.2 was not having money with her as per her own admission and she herself had taken money from her relatives.

(h) The Ld. MM has failed to appreciate the fact that the cheque in question was a security cheque and the appellant had never asked the complainant to present the same.

(i) The Ld. MM has failed to appreciate the defence evidence produced by the appellant.

10. On these grounds, it is contended by the appellant/accused that the order of conviction passed by the Ld. Trial Court is not sustainable in the eyes of law as the same is based on presumptions, conjectures and surmises and complete facts of the case have not been appreciated by the Ld. Trial Court. Therefore, he has prayed for setting aside the impugned judgment and order on sentence.

11. The respondent no.2 / complainant has not filed any formal reply and the Ld. Counsel for respondent no.2 has argued straightaway.

12. I have heard the Ld. Counsel for the parties and perused the record carefully.

13. The Ld. Counsel for the appellant has argued that as per the case of the complainant/respondent no. 2, she had lent an amount of Rs.4,00,000/­ to the appellant/accused on interest. He submitted that admittedly the appellant has no licence from RBI to impart loan on interest nor she has any licence to lend money Criminal Appeal No.61/2024 Page 6 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 as required under the Punjab Registration of Money Lenders Act, 1938 and, therefore, the alleged loan cannot be said to be an enforceable debt or liability. In this regard, he has relied upon Mrs. Monica Sunit Ujjain vs. Sanchu M. Menon & Ors., Criminal Revision Application no. 394/2015, decided on 02.08.2022 by the Hon'ble Bombay High Court and Virender Singh vs. Laxmi Narayan & Anr., 1 (2007) BC 530 by the Hon'ble Delhi High Court. He further argued that husband of the complainant/respondent no. 2 is money lender and he is in the business of giving loan on interest. He further submitted that the appellant had taken loan of Rs.1,50,000/­ from the husband of the complainant/respondent no. 2 and at that time the husband of the complainant had taken blank cheque from the appellant/accused as security against the said loan which later on was manipulated by complainant and her husband. He further submitted that there are various contradictions in the statement of the complainant and her version is not reliable. He further submitted that the Ld. Trial Court has not considered the judgments submitted by the appellant and in view of the above judgment of the Hon'ble Bombay High court, in the absence of any money lending licence, any debt or liability is not enforceable u/s 138 of NI Act. He has prayed for setting aside the impugned judgment and order on sentence and prayed to acquit the appellant.

14. On the other hand, the Ld. Counsel for the respondent no.2/complainant has vehemently argued that the Criminal Appeal No.61/2024 Page 7 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 appellant/accused has admitted issuance of cheque in question in favour of the respondent no. 2/complainant u/s 251 Cr.P.C. and in his statement under Section 313 Cr.P.C. and hence presumption is raised against him that he had issued the cheque towards discharge of legally enforceable debt or liability and he has failed to rebut the said statutory presumption. He further submitted that in the appeal, the appellant/accused has made allegations against the husband of the respondent no. 2/complainant that he is engaged in money lending business but he is not the party to the present case nor he has filed the complaint case against the appellant. He further submitted that the complainant is not a money lender and even if she was charging interest on the loan advanced to the appellant/accused, still the complaint case u/s 138 NI Act against the dishonoured cheque is not barred in view of the judgments of Hon'ble Delhi High Court as relied by the Ld. Trial Court. He further submitted that if the accused had not taken any loan, then it is not understandable as to why he had executed the loan agreement with the respondent no. 2/complainant for Rs.4,00,000/­ and was paying interest @ 15% pm annum to her. He further submitted that there is no complaint against the respondent no. 2/complainant for alleged misuse of the security cheque and forging of loan agreement. He contended that the impugned judgment and order are well reasoned and call for no interference and the present appeal is bereft of any merit and is liable to be dismissed.

Criminal Appeal No.61/2024 Page 8 of 31

Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024

15. It is a cardinal principle of criminal jurisprudence that it is the burden of the prosecution to prove the guilt of the accused beyond reasonable doubt, however the statutory presumptions wherever are available to the accused create an exception to this cardinal principle by shifting the burden of proof to the opposite party. Among the notable presumptions available under the scheme of the NI Act, two are available under Sections 118 (a) and 139 of the Act.

16. Section 118 (a) of the NI Act provides as under: ­ Presumptions as to Negotiable Instruments ­ Until the contrary is proved, the following presumption shall be made; ­

(a) of consideration ­ that 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

17. Section 139 of the NI Act reads as under: ­ Presumption in favour of holder It shall be presumed, unless contrary is proved, that the holder of a cheque received the cheque of the nature referred in section 138 for the discharge, in whole or in part, of any debt or other liability.

18. It has been held by the Hon'ble Supreme Court in Rangappa vs. Sri Mohan, (2010) 11 SCC 441 that :

".... the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability."

19. In Rajesh Jain vs. Ajay Singh, Special Leave Petition Criminal Appeal No.61/2024 Page 9 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 (Crl.) No. 12802 of 2022 decided on 09.10.2023, the Hon'ble Apex Court has observed as under:­

34. The NI Act provides for two presumptions: Section 118 and Section 139. Section 118 of the Act inter alia directs that it shall be presumed, until the contrary is proved, that every negotiable instrument was made or drawn for consideration. Section 139 of the Act stipulates that 'unless the contrary is proved, it shall be presumed, that the holder of the cheque received the cheque, for the discharge of, whole or part of any debt or liability.' It will be seen that the 'presumed fact' directly relates to one of the crucial ingredients necessary to sustain a conviction under Section 138."

35. Section 139 of the NI Act, which takes the form of a 'shall presume' clause is illustrative of a presumption of law. Because Section 139 requires that the Court 'shall presume' the fact stated therein, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. But this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary as is clear from the use of the phrase 'unless the contrary is proved.'

36. The Court will necessarily presume that the cheque had been issued towards discharge of a legally enforceable debt/liability in two circumstances. Firstly, when the drawer of the cheque admits issuance/execution of the cheque and secondly, in the event where the complainant proves that cheque was issued/executed in his favour by the drawer. The circumstances set out above form the fact(s) which bring about the activation of the presumptive clause. [Bharat Barrel vs. Amin Chand] [(1999) 3 SCC 35].

37. Recently, this Court has gone to the extent of holding that presumption takes effect even in a situation where the accused contends that 'a blank cheque leaf was voluntarily signed and handed over by him to the complainant. [Bir Singh v. Mukesh Kumar1].

Criminal Appeal No.61/2024 Page 10 of 31

Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 Therefore, mere admission of the drawer's signature, without admitting the execution of the entire contents in the cheque, is now sufficient to trigger the presumption.

38. As soon as the complainant discharges the burden to prove that the instrument, say a cheque, was issued by the accused for discharge of debt, the presumptive device under Section 139 of the Act helps shifting the burden on the accused. The effect of the presumption, in that sense, is to transfer the evidential burden on the accused of proving that the cheque was not received by the Bank towards the discharge of any liability. Until this evidential burden is discharged by the accused, the presumed fact will have to be taken to be true, without expecting the complainant to do anything further.

39. John Henry Wigmore on Evidence states as follows:

"The peculiar effect of the presumption of law is merely to invoke a rule of law compelling the Jury to reach the conclusion in the absence of evidence to the contrary from the opponent but if the opponent does offer evidence to the contrary (sufficient to satisfy the Judge's requirement of some evidence), the presumption 'disappears as a rule of law and the case is in the Jury's hands free from any rule."

40. The standard of proof to discharge this evidential burden is not as heavy as that usually seen in situations where the prosecution is required to prove the guilt of an accused. The accused is not expected to prove the non­existence of the presumed fact beyond reasonable doubt. The accused must meet the standard of 'preponderance of probabilities', similar to a defendant in a civil proceeding. [Rangappa vs. Mohan (AIR 2010 SC 1898)].

41. In order to rebut the presumption and prove to the contrary, it is open to the accused to raise a probable defence wherein the existence of a legally enforceable debt or liability can be contested. The words 'until the contrary is proved' occurring in Section 139 do Criminal Appeal No.61/2024 Page 11 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 not mean that accused must necessarily prove the negative that the instrument is not issued in discharge of any debt/liability but the accused has the option to ask the Court to consider the non­existence of debt/liability so probable that a prudent man ought, under the circumstances of the case, to act upon the supposition that debt/liability did not exist. [Basalingappa Vs. Mudibasappa (AIR 2019 SC 1983) See also Kumar Exports Vs. Sharma Carpets (2009) 2 SCC 513].

42. In other words, the accused is left with two options. The first option­of proving that the debt/liability does not exist­is to lead defence evidence and conclusively establish with certainty that the cheque was not issued in discharge of a debt/liability. The second option is to prove the non­existence of debt/liability by a preponderance of probabilities by referring to the particular circumstances of the case. The preponderance of probability in favour of the accused's case may be even fifty one to forty nine and arising out of the entire circumstances of the case, which includes: the complainant's version in the original complaint, the case in the legal/demand notice, complainant's case at the trial, as also the plea of the accused in the reply notice, his 313 statement or at the trial as to the circumstances under which the promissory note/cheque was executed. All of them can raise a preponderance of probabilities justifying a finding that there was 'no debt/liability'. [Kumar Exports and Sharma Carpets, (2009) 2 SCC

513.

43. The nature of evidence required to shift the evidential burden need not necessarily be direct evidence i.e., oral or documentary evidence or admissions made by the opposite party; it may comprise circumstantial evidence or presumption of law or fact.

44. The accused may adduce direct evidence to prove that the instrument was not issued in discharge of a debt/liability and, if he adduces acceptable evidence, the burden again shifts to the complainant. At the Criminal Appeal No.61/2024 Page 12 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 same time, the accused may also rely upon circumstantial evidence and, if the circumstances so relied upon are compelling the burden may likewise shift to the complainant. It is open for him to also rely upon presumptions of fact, for instance those mentioned in Section 114 and other sections of the Evidence Act. The burden of proof may shift by presumptions of law or fact. In Kundanlal's case­ (supra) when the creditor had failed to produce his account books, this Court raised a presumption of fact under Section 114, that the evidence, if produced would have shown the non­existence of consideration. Though, in that case, this Court was dealing with the presumptive clause in Section 118 NI Act, since the nature of the presumptive clauses in Section 118 and 139 is the same, the analogy can be extended and applied in the context of Section 139 as well.

45.Therefore, in fine, it can be said that once the accused adduces evidence to the satisfaction of the Court that on a preponderance of probabilities there exists no debt/liability in the manner pleaded in the complaint or the demand notice or the affidavit­evidence, the burden shifts to the complainant and the presumption 'disappears' and does not haunt the accused any longer. The onus having now shifted to the complainant, he will be obliged to prove the existence of a debt/liability as a matter of fact and his failure to prove would result in dismissal of his complaint case. Thereafter, the presumption under Section 139 does not again come to the complainant's rescue. Once both parties have adduced evidence, the Court has to consider the same and the burden of proof loses all its importance. [Basalingappa vs. Mudibasappa, AIR 2019 SC 1983; See also, Rangappa vs. Sri Mohan (2010) 11 SCC 441].

20. As such, once the issuance of the cheque is admitted or proved, the court is duty bound to raise a presumption that the dishonoured cheque placed before it was indeed issued in Criminal Appeal No.61/2024 Page 13 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 discharge of a legally enforceable debt or liability of the amount mentioned therein. Of course, the said presumption is rebuttable one and it is for the accused to prove that the cheque in question had not been issued in discharge of a legally enforceable debt or liability.

21. It has been held in Hiten P Dalal vs. Bratindranath Banerjee, (2001) 6 SCC 16 that a mere plausible explanation given by the accused is not enough to rebut the presumption and the accused has to necessarily disprove the prosecution case by leading cogent evidence that he had no debt or liability to issue the said cheque.

22. In Rangappa vs. Sri Mohan (supra), the Hon'ble Supreme Court has observed as under: ­ Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective to improve the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. 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 of proof. In Criminal Appeal No.61/2024 Page 14 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 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 submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accuses may not need to adduce evidence of his/her own.

23. In view of the aforesaid proposition of law laid down by the Hon'ble Apex Court, it has to be seen as to whether the respondent no. 2/complainant has been able to prove that there was legally enforceable debt or liability for which the cheque in question was issued by the appellant/accused or that the appellant/accused has been able to rebut the presumption and prove that the cheque in question had not been issued in discharge of legally enforceable debt or liability but the same were given as security to the husband of the respondent no. 2/complainant against a loan amount of Rs.1,50,000/­ and the same has been misused by the respondent/complainant.

24. In view of the defence taken by the appellant that he had taken Rs.1,50,000/­ only as loan and that too from the husband of the respondent no. 2/complainant, it was incumbent for the complainant to prove that she had advanced a loan of Criminal Appeal No.61/2024 Page 15 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 Rs.4,00,000/­ to the accused/appellant for which the loan agreement Ex.CW1/5­A was executed between them.

25. The respondent no. 2/ complainant examined herself as CW­1 and filed her evidence by way of affidavit Ex.CW1/A in which she has deposed on the lines of averments made in the complaint. In her cross­examination, she stated that she had signed on her evidence by way of affidavit Ex.CW1/A in the chamber of her counsel at Karkardooma Courts. She can read and write Hindi fluently but she can read English a little bit. She further stated that the contents of the affidavit Ex. CW1/A were read over to her and, thereafter, she had signed the same. The contents of the same were got written by her counsel on her instructions and the same are correct.

26. From the above statement of the respondent no. 2/complainant during her cross­examination, it is apparent that the Ld. Counsel for appellant could not assail her testimony that evidence by way of affidavit Ex.CW1/A was prepared on her instructions by her counsel.

27. The respondent no. 2/complainant further stated that the accused resides at H. No. 2/77, Lalita Park, Laxmi Nagar, Delhi. She had visited his house prior to handing over the money and also after handing over the money to him. She stated that the said house is built up to two and half storeys. On her visit to second floor of the house of the accused where he was residing, a PG girls hostel was already running prior to handing over the money to him. She volunteered that the accused had asked money for Criminal Appeal No.61/2024 Page 16 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 getting wooden work done in the said portion.

28. The above statement of the complainant shows that the appellant/accused and respondent no. 2/complainant were known to each other.

29. The respondent no. 2/complainant further stated that document Ex.CW1/5A (loan agreement ) was got prepared by the accused himself and he had brought the same to her house. She further stated that although the agreement was got prepared by the accused 8­10 days prior to handing over the money but the same was got signed on the day when the money was handed over to him. She further stated that the amount of Rs. 4,00,000/­ was lying with her and was not taken from any bank. She stated that the amount of Rs.1,50,000/­ was given to her by her father­ in­law for the benefit of her children and rest amount of Rs.2,50,000/­ was her savings.

30. In view of the above, the complainant has disclosed the source of advancement of loan of Rs.4,00,000/­ and her financial capacity to advance loan of Rs.4,00,000/­ to the appellant/accused.

31. She further stated that at the time when the amount of Rs.4 lakhs in cash was handed over to the accused, her husband, younger brother­in­law (devar) and nephew of her husband were present. She further stated that the said agreement was signed as a witness by her devar and nephew of her husband. She stated that she does not have any licence to impart loan to any person Criminal Appeal No.61/2024 Page 17 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 on interest. She categorically stated that she has not handed over any loan to any other person. She has come to know after filing of the present complaint that her husband has also imparted interest free loan to 2­3 other persons. She stated that cheque in question was handed over by the accused to her at the time when the loan was given to him. She further stated that the cheque in question was already filled up when the accused had brought the same, though he had signed the said cheque in her presence. She volunteered that the accused himself filled up the date himself on the cheque on 16.05.2018 itself when he had stopped making the payment of the interest amount to her. She denied the suggestion that she and her husband have been imparting loan to different person on interest without any licence to do the same. She further denied the suggestion that accused had taken a loan of Rs.1,00,000/­ and thereafter a loan of Rs.50,000/­ only or that at the time of handing over the money, her husband had taken a blank signed cheque from the accused. She further denied the suggestion that the said cheque was later filled up in her name with an exaggerated amount, although the accused had paid the total amount with interest to him. She denied the suggestion that there are many cases u/s 138 pending in Karkardooma Courts itself wherein she is the complainant. She denied the suggestion that she has filed the case to extort the money from the accused.

32. The aforesaid cross­examination of the respondent no.

2/complainant shows that the accused had not been able to extract anything to demolish her version. During her cross­ Criminal Appeal No.61/2024 Page 18 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 examination, the complainant has disclosed source of Rs. 4,00,000/­ advanced to the accused as loan, the name of the witnesses in whose presence the loan was given and the loan agreement was executed by the accused. The accused has not put a single suggestion to the complainant that she did not have the financial capacity to advance a loan of Rs. 4,00,000/­.

33. The respondent no. 2/complainant has also examined Sh. Vikram Talwar as CW­2 to prove the factum of advancement of loan of Rs. 4,00,000/­ to the appellant/accused. CW­2 Vikram Talwar deposed in his chief examination that he is one of the witnesses to loan agreement Ex.CW1/5 which was prepared by the accused on 18.04.2016 but the same was executed between the parties on 28.04.2016. He further deposed that the loan amount of Rs. 4,00,000/­ had been paid in cash by the complainant to the accused in his presence on 28.04.2016 and pursuant thereof the said loan agreement was executed. He further deposed that the accused has handed over cheque of Rs. 4,00,000/­ drawn on SBI bank along with his photocopy of Aadhar card to the complainant in his presence.

34. In the cross­examination, CW­2 Viram Talwar stated that complainant is his aunt and he is cab driver by profession. He visits the family of complainant and house of complainant is situated next to his house. He categorically stated that he has signed the document Ex.CW1/5A on 28.04.2016. Though he could not remember the time but he stated that it was around evening time. He further stated that he had not signed on any Criminal Appeal No.61/2024 Page 19 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 agreement between the complainant and any other person except the loan agreement Ex.CW1/5­A. He stated that his Chacha is property dealer by profession. He had not signed any loan agreement between his uncle and any other persons. He categorically stated that the accused had signed Ex.CW1/5­A in his presence. At that time, no other person except the complainant, her husband and accused were present. He had left after signing the documents. He categorically stated that amount of Rs. 4,00,000/­ was handed over to the accused by the complainant in his presence. He did not know from where the complainant had procured Rs.4,00,000/­ as the same was available with her at that time. He also did not know if any interest was payable on the said loan amount. He came to know about the loan having been given to other persons also by the husband of the complainant. He has no knowledge if the complainant has also handed over any loan to any other person except the present loan agreement. He stated that accused handed over a cheque while the complainant has given Rs. 400,000/­ in his presence. He stated that the document Ex.CW1/5­A was not prepared in his presence. He further stated that the accused had brought already prepared loan agreement while he, complainant and his uncle were sitting in the house. He denied the suggestion that ink and handwriting of the particulars as filled up in the cheque and signature of the accused are different. He denied the suggestion that no loan of Rs.4,00,000/­ was given by the complainant to the accused. He further denied the suggestion that accused had not signed any loan agreement or that already blank Criminal Appeal No.61/2024 Page 20 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 signed paper was filled up to make out the loan agreement.

35. The aforesaid cross­examination of the witness shows that the testimony of the CW­2 is fully reliable and trustworthy and corroborates the case of the complainant and her testimony. The complainant has been able to prove through testimony of CW­2 that she had given Rs. 4,00,000/­ to the appellant/accused in the presence of CW­2 and, thereafter, the loan agreement was executed between the appellant and the complainant and was signed by CW­2 as a witness. Except the suggestions, there is nothing in the cross­examination of CW­2 to impeach his veracity and credibility.

36. The appellant/accused has not disputed issuance of the cheque in question Ex.CW1/1, but he has contended that he had given blank signed cheque towards security to the husband of complainant against loan of Rs.1,50,000/­ taken from the husband of the complainant. The appellant/accused in order to prove the said claim has examined himself as DW­1. He deposed that he knows the complainant since his childhood and there was monetary transaction with the complainant. He further deposed that he has taken from the complainant an amount of Rs.1,50,000/­ in two installments of Rs.1,00,000/­ and Rs.50,000/­ on interest @ 15% per month and he used to pay Rs.15,000/­ per month as interest to the complainant. He further deposed that he has given security cheque as blank signed to Kiran Talwar and her husband Rajeev Talwar. He further deposed that the complainant used to do the work of money Criminal Appeal No.61/2024 Page 21 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 lending. He further deposed that both the complainant and his wife had misused the cheque and had filed several cases against him. He further deposed that the complainant had got an FIR registered against him bearing FIR no. 268/18 u/s 354/506/509 IPC at PS Shakarpur.

37. In his cross­examination, DW­1 the appellant/accused stated that he did not remember the exact date, however he had taken the said amount of Rs.1,50,000/­ from the complainant about four years ago. He further stated that no written agreement was executed, however the complainant got his signatures on some blank papers. He admitted that Ex.CW1/5­A bears his signatures at point A. He admitted that cheque in question Ex.CW1/A bears his signature at point A. He stated that he has not lodged any police complaint regarding the alleged loan agreement and that he had come to know that complainant has filled the contents of cheque when he received the notice of the present case. He admitted that he has asked the money from the complainant. He further admitted that he has given the cheque in question at the time of receiving the money. He did not object to the complainant obtaining his signatures and thumb impression on blank papers since they used to have very good relationship and he used to consider him as elder brother. He stated that he returned the said amount of Rs.1,50,000/­ obtained from the complainant. He has not taken any receipt in writing when he returned the said money.

38. From the aforesaid cross­examination of the Criminal Appeal No.61/2024 Page 22 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 appellant/accused, it is apparent that the appellant/ accused has not disputed the issuance of cheque in question. He has also not disputed the execution of loan agreement and his signatures thereon. The appellant/accused has also admitted that he had asked money from the complainant and that he had given the cheque in question at the time of receiving of money.

39. In view of these admissions of the accused coupled with the fact that the complainant through her testimony as well as testimony of CW­2 has been able to prove that she had advanced a loan of Rs. 400,000/­ to the accused and at the time of grant of loan of Rs. 400,000/­, loan agreement Ex.CW1/5A was executed, it stands proved that the accused had issued the cheque in question Ex.CW1/1 towards discharge of legally enforceable debt or liability. The accused was required to rebut the said presumption and to substantiate the plea taken by him in his defence. However, the stand of the accused is completely contradictory and unreliable.

40. It may be noted that in the application u/s 145(2) of NI Act, the accused had taken a plea that he was never having family terms or neighbourly relations with the complainant at any point of time as alleged by the complainant; that he had never taken any loan from the complainant and never had come with the complainant; that he had taken a loan of Rs.1,50,000/­ from the husband of the complainant and he had no dealing with the complainant; that husband of the complainant had forcibly got issued blank undated and signed cheque from him which was Criminal Appeal No.61/2024 Page 23 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 misused by them; that the accused had already returned the whole amount which was taken by him with interest @ 10% p.m to the complainant.

41. However, the accused himself has contradicted all these pleas taken in the application under Section 145(2) of the NI Act when he stated in his examination in chief that he knows the complainant since childhood and there was monetary transactions with the complainant. During cross­examination also, he admitted to have good relations with the complainant. Similarly, in the application under Section 145(2) of the NI Act, the accused stated that the husband of the complainant had forcibly got blank signed cheque from him, while in his chief examination he has not stated that husband of the complainant has forcibly taken blank signed cheque. Rather, he stated that he had given a security cheque as blank signed to Kiran Talwar and her husband Rajeev Talwar. Further, the accused had stated in the application that he had returned the whole amount which was taken by him with interest @ 10% to the complainant, while in his chief examination he stated that he used to pay Rs.15,000/­ per month as interest to the complainant on Rs.1,50,000/­ @ 15% per month. The accused in his statement recorded u/s 313 Cr.P.C. took completely contradictory stand when he stated that he has not returned the said amount of Rs.1,50,000/­ to the complainant.

42. It all shows that the appellant/accused himself is not sure of his defence and taking contradictory stands in the application under Section 145(2) of the NI Act and during the course of trial Criminal Appeal No.61/2024 Page 24 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 and in the present appeal. Even otherwise, the claim of the appellant/accused that he had taken Rs.1,50,000/­ from the complainant or her husband is not substantiated by any oral or documentary evidence. Further, though the appellant has claimed in the application u/s 145(2) the NI Act as well as during cross­ examination of CW­1 (the complainant) that he has repaid the total amount with interest, but he has not disclosed the manner in which the said amount was repaid i.e. the amount and the dates on which the said amount of Rs.1,50,000/­ was repaid and in whose presence besides the fact that even the repayment of Rs.1,50,000/­ is contradictory to his statement u/s 313 Cr.P.C. as noted hereinabove. The accused when examined himself and entered into witness box as DW­1 even did not state that he had repaid Rs.1,50,000/­ to the complainant or to her husband.

43. Apart from this, the appellant has taken only a vague plea that he had given a blank signed cheque or that blank papers were got signed from him which were used in preparing the loan agreement. This plea is not tenable and plausible for the reasons that a man of normal prudence would not issue a blank signed cheque nor he would sign the blank papers. Further, even if for the sake of arguments if the husband of the complainant had forcibly taken blank and undated signed cheque from the accused, then it is not understandable that why the accused remained silent and did not take any legal action against the complainant or her husband.

44. Admittedly, the appellant/accused had come to know Criminal Appeal No.61/2024 Page 25 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 about the contents of cheque and the loan agreement when he received the notice of the present case, rather prior to the same when he had received the legal demand notice from the complainant. However, the appellant/accused despite having coming to know that the complainant or her husband has allegedly misused the blank signed cheque and forged the loan agreement, he did not lodge any police complaint or took any other legal action. Hence, the plea taken by the accused is malafide, untenable and has also remained unsubstantiated.

45. On the other hand, the respondent no. 2/complainant has proved that she had advanced a loan of Rs. 4,00,000/­ to the appellant for which the loan agreement was also executed and the appellant/accused himself had given the cheque in question towards discharge of said liability and the said cheque got dishonoured due to insufficiency of funds.

46. The Ld. Counsel for appellant has though vehemently argued that the complainant has advanced the loan on interest without having any money lending licence, therefore even if there is any liability arising out of the said transaction, the same is not enforceable. Thus he would argue that the complaint case under Section 138 NI Act was not maintainable for want of money lending licence either from RBI or under Punjab Registration of Money Lenders Act, 1938. He has relied upon the orders in Mrs. Monica Sunit Ujjain vs. Sanchu and Menon & Ors. and Virender Singh vs. Laxmi Narayan & Anr., cited supra.

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47. I have gone through the said judgments. In case of Monica Sunit Ujjain, the Hon'ble Bombay High Court found that there were huge amount parted to the accused in MOU and the said transactions were without licence and considering the factual matrix of the case, the Hon'ble High Court rejected the revision petition and upheld the order of Sessions Judge by which the complaint under Section 138 NI Act was dismissed on the ground that in cases of money lending business without the licence, the proceedings were not maintainable in law. The said judgment is not applicable in the present case as in the present case the accused has not been able to demonstrate that the complainant is dealing in money lending business. Even if for the sake of arguments, it is assumed that the complainant was in the business of money lending, still the criminal proceedings under Section 138 of NI Act are not barred. Reliance can be placed on the judgment which the Ld. Trial Court has rightly referred in the impugned judgment.

48. In Hansraj Bansal vs. State & Ors., 2023 SCC Online DEL 5678, the Hon'ble High Court of Delhi has discussed in detail the issues of Punjab Registration of Money Lenders Act, 1938, its applicability to the Negotiable Instruments Act and various other judgments of different High Courts and after a detailed analysis held that Section 3 of Punjab Registration of Money Lenders Act, 1938 does not limit operation of Section 138 of the NI Act and both are independent and mutually exclusive to each other. In the teeth of the observations made in Criminal Appeal No.61/2024 Page 27 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 the above judgment of the Hon'ble High Court of Delhi, there is no merit in the contention of Ld. Counsel for the appellant that the present case under Section 138 NI Act filed by the respondent no. 2/complainant was not maintainable as the complainant was in money lending business and she did not have the requisite licence.

49. Similarly, reliance on the judgment in Virender Singh case (supra) by the Ld. Counsel for the appellant/accused is misplaced. In the said case, it was observed by the Hon'ble Delhi High Court that consideration for securing a job in Haryana police was for an unlawful object and both the parties had voluntarily and by their free will joined hands to flout the law i.e. to secure a job in the Haryana police by unlawful means and in those facts the Hon'ble High Court has held that the liability was not enforceable arising out of a void agreement. But it is not the case here.

50. In view of the above discussions, the judgments relied by the Ld. Counsel for the appellant/accused are not applicable and wholly misplaced. It may be noted that the defence of the accused throughout the trial and during course of the arguments is centered around that the husband of the complainant is in money lending business because he has also imparted loans to other persons. Though even the said fact has not been proved by the appellant that husband of the complainant is in money lending business and advancing the loan on interest. However, even if for the sake of arguments the said fact is considered to be Criminal Appeal No.61/2024 Page 28 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 true, it will be having no bearing to the present case as the present case has been filed by respondent no. 2/ complainant Kiran Talwar who had advanced the loan to the appellant/accused for which the appellant/accused had issued the cheque in question to discharge legally enforceable debt or liability and the said cheque got dishonoured on presentation. The husband of the complainant has nothing to do with the present case. Similarly, if husband of the complainant is in money lending business, it will have no bearing to the present case.

51. It is also contended in the appeal that any loan transaction over and above of Rs.20,000/­ in cash is illegal transaction u/s 269 SS of Income Tax Act and therefore the Ld. Counsel would argue that on this count also the case of the complainant was liable to be dismissed. However, again there is no merit in the said contention. It has been held in Sheela Sharma vs. Mahender Pal, Crl. L.P. No. 559/2015, date of decision 02.08.2016 by the Hon'ble Delhi High Court that : ­ "The mere advancement of the loan in cash, may entail consequences for the party acting in breach of Section 269 SS of the Income Tax Act. That is not the concern of this court. Whether, or not, the appellant reflected the availability of the said amount in her income tax return, is also not a matter of concern for this Court. That would again be an aspect to be considered by the income­tax authorities. The advancement of loan, in cash, to the tune of Rs. 10 lakhs is not prohibited in law. The transaction of advancement of loan of Rs. 10 lakhs, in cash, thus is not illegal. Such a transaction is enforceable at law."

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52. In view of the aforesaid discussions, in my considered opinion, the appellant/accused has miserably failed to rebut the presumption against him that the cheque in question was issued towards legally enforceable debt or liability or that he had issued a blank signed cheque towards the loan amount of Rs.1,50,000/­ which has been misused by the complainant or that there was no outstanding liability against him. The impugned judgment convicting the appellant under Section 138 NI Act is well reasoned and calls for no interference. Hence, the same is upheld.

53. Vide impugned order dated 26.02.2024, the appellant/accused was sentenced to imprisonment for 05 months along with compensation of Rs. 6,00,000/­ payable to the respondent/complainant within a month from the date of order and in default of payment of compensation, to further undergo simple imprisonment for 03 months.

54. In the present case, cheque in question Ex.CW1/1 was issued by the appellant/accused on 16.05.2018 towards the repayment of loan amount which on presentation got dishonoured. The appellant/accused did not make the payment of the dishonoured cheque despite demand made by the complainant through legal notice dated 29.05.2018 and dragged the complainant into the litigation which lasted for about 06 years. Therefore, the compensation awarded to the respondent/complainant as well as the sentence of imprisonment of five months awarded to the appellant/accused does not appear to be on higher side. This Court is in agreement with the Ld. Criminal Appeal No.61/2024 Page 30 of 31 Jasbir Singh Vs. State of NCT of Delhi & Anr. Judgment dt. 03.05.2024 Trial Court on the quantum of sentence awarded to the appellant/accused vide impugned order dated 26.02.2024. Thus, no interference is required.

55. In view of the aforesaid discussions, the present appeal is devoid of any merit and the same is hereby dismissed.

56. The appellant is taken into custody and warrant of commitment be sent to the concerned Jail Superintendent for executing the sentence.

57. Copy of judgment is supplied to the appellant free of cost against acknowledgement.

58. TCR be sent back to the Ld. Trial Court along with copy of this judgment.

59. Appeal file be consigned to Record Room after due Digitally signed compliance. by BALWANT BALWANT RAI BANSAL RAI Date: 

                                                      BANSAL    2024.05.03
                                                                16:18:15
      Announced in the open Court                               +0530
      on 3rd May, 2024                (Balwant Rai Bansal)
                            Special Judge (NDPS Act), Shahdara
                                  Karkardooma Courts, Delhi




      Criminal Appeal No.61/2024                                   Page 31 of 31
      Jasbir Singh Vs. State of NCT of Delhi & Anr.        Judgment dt. 03.05.2024