Delhi District Court
Yogender vs Jag Narayan on 20 March, 2024
IN THE COURT OF METROPOLITAN MAGISTRATE EAST DISTRICT,
KARKARDOOMA COURTS, DELHI.
Presided by: Sh. Divyam Lila
UNIQUE-ID : 02402R004560-2016
CNR No. : DLET02-00-3550-2016
CT No. : 57207/2016
PS: Pandav Nagar
Yogendra Kumar,
S/o Sh. V.P. Singh,
R/o S-11-D/20, Ist Floor,
Pandav Nagar Ext.,
Delhi-110092.
....... Complainant
VERSUS
Mr. Jag Narayan Yadav,
S/o Sh. Moti Lal Yadav,
R/o 4th F-597, Vaishali,
Ghaziabad, UP.
...... Accused
In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
Complaint under section 138 of the Negotiable Instruments Act, 1881
Date of institution : 14.02.2012
Date of decision of the case : 20.03.2024
Plea of Accused : Not guilty
Final Order : Convicted
JUDGMENT
STATEMENT OF FACTS AND REASONS FOR DECISION
1. The accused is facing trial for commission of offence punishable u/s 138 of The Negotiable Instruments Act, 1881 (in short, NI Act). Facts in brief:
2. As per complaint, the complainant states that the accused person had issued the cheque towards the refund of the booking amount for the agreement to sell of the flat in Vaishali Ghaziabad. The said cheque was put for encashment, and the same was received as dishonoured vide return memo dated 03.12.2011. Thereafter, the legal notice dated 29.12.2011 was issued to the accused advising him to pay the cheque amount, however the accused did not pay even after expiry of 15 days frm the day of due service. Hence, the present complaint under section 138 Negotiable instruments act, 1881 (herein referred as 'NI Act').
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 2 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
2. The present case pertains to cheque no. 236489 dated 10.08.2011 amounting to Rs.1,00,000/- drawn on Bank of Baroda, Suriya Nagar, Ghaziabad. (hereinafter called 'cheque in question'). The said cheques got dishonoured vide return memo dated 03.12.2011 with reason "Funds Insufficient".
3. The cognizance of the offence u/s 138 NI of Act was taken by Ld. Predecessor of this court and thereafter the accused was summoned; thereafter the accused put up his appearance before the court and then the notice u/s 251 Criminal Procedure Code, 1973 (in short, "Cr. P. C") was framed. Notice:
5. Notice u/s 251 of Cr. P. C was served upon the accused. The accused did not plead guilty and claimed trial. The accused had admitted that he had issued the cheque in question to the complainant, and he did not receive the legal notice from the complainant. He also admitted that signature on the cheque also belonged to him.
6. Thereafter, the matter was listed for Complainant's Evidence.
Complainant's Evidence:
7. To substantiate his case, the complainant adduced his evidence by affidavit as CW1. thereafter the evidence of the complainant was closed.
The complainant was examined as CW-1. The CW 1 reiterated the facts mentioned in the complaint and relied upon documents filed along the case. The witness was cross-examined on behalf of the accused. During Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 3 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. the same, following notable points were stated, relevant parts of which are reproduced verbatim:-
1. "I am Graduate. I can read and write in Hindi & English. It is correct that an agreement dated 29.06.2011 was executed between me and the accused which is already on record as Mark- CW1/F.
2. It is correct that the consideration amount for the property purchased by this agreement is Rs.24,50,000/-. As per the clause no. 2 of the agreement Mark CW1/F the title document of the property should be executed within 45 days from the execution of Mark CW1/F. It is correct that as per the clause no. 3 of document Mark-CW1/F if the buyer / complainant backout the agreement then the bayana money would be forfeited by the seller / accused, It is correct that as per clause no. 3 of Mark-CW1/F if I failed to execute the title document of the property within 45 days, I can not take any legal action against the seller / accused. Vol. The dispute had arisen between us before 45 days as the property agreed to be sold by the accused was for a lesser area than agreed. Also the balcony was sater on covered by the accused. It is correct that this fact is not mentioned in my complaint or legal notice. Vol. As accused had agreed to refund the earnest amount to me by way of cheque in question.
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 4 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
3. No letter or notice was given to the accused at the time when the dispute arose within 45 days. Vol. As talks were going on between us. It is wrong to suggest that no dispute was arisen within 45 days from the execution of agreement Mark CW1/F. I have paid Rs.1,00,000/- as earnest money to the accused as per document Mark CW1/F. It is correct that as per clause no. 4 of Mark CW1/F if seller backout from the agreement then he shall pay double the earnest money to the buyer. The cheque in question in the present case is for Rs.1,00,000/-. The cheque in question was handed over by the accused to me on 10.08.2011. It is correct that I do not give any notice or file any suit against the accused for giving me double the earnest money. Vol. As I had asked the accused to return me only the amount given by me to him. It is correct that as per clause no. 7 of Mark CW1/F I was liable to pay the charges of sell deed / title document in respect of the property mentioned in the document Mark CW1/F. I did not go to the office of the registrar for execution of title deed within 45 days. Vol. As the property was still under construction. It is correct that I have not placed on record any document to show that I had Rs.23,50,000/- in my bank account for purchase of property, Vol. I would have arranged the amount from the bank as loan. It is also correct that till that time I had not Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 5 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. applied for loan with any bank. Vol. As the property was still under construction and bank manager would have asked for title document before sanctioning the loan.
4. It is wrong to suggest that I had fulfilled the particulars of the cheque in question. It is correct that I had not post the legal demand notice Ex. CW1/D. Vol. The same was post by my counsel. The document Ex. CW1/E1 and Ex. CW1/E2 are computer generated documents. The cheque Ex. CW1/13 was issued after the 45 days of execution of document Ex. CW1/F. It is wrong to suggest that I requested from the accused to take cheque in question as security against the earnest money / bayana at the time of execution of document Ex. CW1/F. It is wrong to suggest that the legal demand notice was not issued or served to the accused. It is wrong to suggest that postal report of the legal notice is forged and fabricated. It is wrong to suggest that I back out from the term & condition of the document Ex. CW1/F. It is wrong to suggest that the cheque in question was given in blank signed condition to me. It is wrong to suggest that accused requested / demanded his security cheque in question from me but I stated that the same has been destroyed by me and I am unable to return the same. It is wrong to suggest that I have concealed the true and correct fact from this Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 6 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. court. It is wrong to suggest that accused is not liable to pay any cheque amount to me. It is wrong to suggest that the present complaint filed just to extort money from the accused. It is wrong to suggest that I have filed the false complaint against the accused. It is wrong to suggest that I am deposing falsely."
8. The complainant had also moved an application under section 311 Crpc after the conclusion of stage of the Defence evidence, which was allowed and the complainant had examined two witness CW2 Sh. Prabuddha kumar Sankhwar and CW3 Ms. Mala.
9. The complainant had summoned and examined the bank witness CW2 Sh. Prabuddha Kumar Sankhwar (the same witness who was already summoned by accused as DW 2 earlier) from the bank of Baroda; who deposed in his chief examination that:- "I have been authorized by Sh. J.P. Sinha, Branch Manager, Bank of Baroda, Pandav Nagar, Patpar Ganj, Delhi to appear before the court with summoned record. The authority letter is now Ex. CW2/A. Same bears his signature at point 'A'. "I have brought today original Postage register. Cheque No.236489 in sum of Rs.1,00,000/- in the name of Yogender Kumar is mentioned at serial No.7 of the register dated 03.12.2011. Attested copy of page of the register, dated 03.12.2011 is now Ex. CW2/B (OSR)."
10.The witness CW 2 was duly cross examined by the counsel for the accused; the excerpts of which is reproduced here.:- "It is correct that I have no Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 7 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. personal knowledge of the instant case. I have deposed on the basis of records available with the bank. I have no idea within how many days cheque return memo is issued by the bank."
10.The complainant had also summoned and examined the bank witness CW3 Ms. Mala Tripathi, Senior Manager, from the bank of Baroda; who deposed in his chief examination that:- "I am the summoned witness. I am working as Senior Manager in Bank of Baroda, Surya Nagar Branch, Delhi. I have brought statement of account of Jag Narayan Yadav from 01-08-2011 to 29-02- 2012. Same is Ex. CW3/A."
11.The witness CW-3 was duly cross examined by the counsel for the accused; the excerpts of which is reproduced here.:- "As per the Ex. CW3/A, the cheque bearing no. 236489 was dishonoured on 01-09-2011. I have no knowledge about the bank memo of the aforesaid cheque."
Statement of the Accused:
13.Thereafter, Complainant's evidence was closed and the accused was examined u/s 313 of Cr. PC. Accused reiterated the defence that was taken by him in his notice u/s 251.
14.The accused expressed his willingness to lead defence evidence (in short, DE).
Accordingly, the matter was listed for DE.
Defence Evidence:
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 8 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
15.The accused had examined two witnesses, himself as DW1 and another bank witness as DW2 Sh. Prabuddha Kumar Sankhwar; DW 1 had deposed in his chief examination; the excerpts of which are produced verbatim here:
1. "I had a deal with the complainant regarding sale of my house. An agreement was entered between us for the same. The complainant had given me Rs 1 lac as earnest money for the sale/purchase. As per terms of the agreement, the complainant had agreed to get the house registered in his name within 45 days from the date of agreement failing which, he would forfeit the earnest money. There were further stipulation in the agreement that if I failed to deliver the possession of the house to the complainant within the time stipulated, I would pay him double the amount of earnest money. At the time of handing over the earnest money, the complainant had inquired me about the security of the amount handed over by him to me. As a security for the amount of Rs 1 lac given by the complainant, I issued the cheque Ex CW-1/13 under my signature.
The complainant did not get the house registered even after 45 days as per agreement. I asked the complainant to retum back my security cheque. The complainant told me that he had destroyed the cheque. Thereafter, the complainant misused the cheque by filing the instant complaint."
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 9 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
16.The accused / DW1 was duly cross examined by the complainant; the excerpts of the cross examination are as follows:
1. "I was working as a builder for last 14-15 years. There was no other transaction between me and the complainant apart from the one for sale/purchase of my house. I do not remember the exact amount which the complainant was supposed to pay for the sale/purchase of the house.
Vol. The complainant was supposed to pay the entire amount as per agreement except earnest money of Rs one lac.
2. I do not remember whether there was any stipulation in the agreement regarding the security cheque issued by me. I do not remember if I have placed on record any document to show that I had issued the security cheque to the complainant. I do not issue security cheque to every buyer. Vol. I issue security cheque to only those buyers, who do not have trust. There is no other complaint u/s 138 of N.I. Act against me in any court. I do not know whether there is any other complaint titled Sh Amar Nath Verma Vs Jag Narayan Yadav against me in the court of Sh Prayant Nayak, Ld MM, Karkardooma Court, Delhi. I had not made any complaint any where when the complainant did not return my security cheque as I did not have much understanding of the issue.It is wrong to suggest that I am deposing falsely."
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 10 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
17.The accused had also summoned and examined the bank witness DW2 Sh. Prabuddha Kumar Sankhwar from the bank of Baroda; who deposed in his chief examination that:-
1. "I have been authorized by Sh. J.P. Sinha, Chief Manager, Bank of Baroda to appear before the court. The authority letter is now Ex.
DW2/A. Copy of my ID card is now Ex. DW2/B(OSR). I have brought today statement of account of account по. 21290100011883 pertaining to account of Sh. Yogendra Kumar (running in 5 pages). The statement of account is now Ex. DW2/C(colly). Cheque number of cheque Ex. CW1/3 is not reflected from account statement Ex. DW2/C(colly)."
18.The witness DW 2 was duly cross examined by the counsel for the complainant Sh. Rajkumar; the excerpts of which is reproduced here.:-
1. "With the permission of the court, Ex. CW1/C from judicial file has been shown to the witness. Ex. CW1/C is not cheque retum memo It is only a covering letter. Ex. CW1/C has not been issued by my bank. Seal on cheque Ex. CW1/B is seal of my bank. Vol. Normally the seal of the bank is kept at public counter and the customers do affixed the seal on their own."
Final Arguments:
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 11 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
19.I have heard arguments on behalf of both the parties, gone through the judgments relied upon by them and have carefully gone through the material on record.
20.It is submitted by the Ld. Counsel for complainant that accused is liable to be convicted as all ingredients of offence u/s 138 of NI Act are fulfilled in the instant case and accused failed to rebut the statutory presumption in favour of the complainant. On the other hand, Ld. Defence counsel led emphasis on the defence that the present cheque was misused by the complainant.
Legal Discussion on the point of law:
21.The accused had denied receipt of the legal notice. The Hon'ble Supreme Court of India in C.C. Alavi Haji Vs. Palapetty Muhammed, 2007 (6) SCC 555 while discussing the true intent behind the service of legal demand notice as a precursor to the launch of prosecution held that the service of summons of the court is opportunity enough for the accused to pay the cheque amount and evade prosecution and any accused who fails to pay the amount within 15 days of the service of summons, clearly cannot protect himself/herself behind the technical demand of non- service of legal notice. The relevant extract of the decision is reproduced herein:-''It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 12 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of Act, make payment of the cheque amount and submits to the court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the court alongwith the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C.Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso, would defeat the very object of the legislation''. Thus, in view of the above said law, the summons was duly served upon the accused and therefore, the mandatory statutory legal notice is deemed to have been served on the accused in the present case.
22.Accused has admitted the fact that the cheque in the present case bears his signature. The plea of accused that the particulars of the cheque in question were not filled by him is of no help. In Ravi Chopra vs State & Anr, Hon'ble High Court of Delhi held: "Section 20 NI Act talks of "inchoate stamped instruments" and states that if a person signs and Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 13 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. delivers a paper stamped in accordance with the law and "either wholly blank or have written thereon an incomplete negotiable instrument" such person thereby gives prima facie authority to the holder thereof "to make or complete as the case may be upon it, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp." "A collective reading of the above provisions shows that even under the scheme of the NI Act it is possible for the drawer of a cheque to give a blank cheque signed by him to the payee and consent either impliedly or expressly to the said cheque being filled up at a subsequent point in time and presented for payment by the drawee. There is no provision in the NI Act which either defines the difference in the handwriting or the ink pertaining to the material particulars filled up in comparison with the signature thereon as constituting a 'material alteration' for the pur- poses of Section 87 NI Act. What however is essential is that the cheque must have been signed by the drawer."
23.Further, in Bir singh Vs. Mukesh Kumar, (2019) 4 SCC 197 it was held that:-"It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted."
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 14 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
24.The factum of dishonour of the cheque is in dispute; in essence, what has been disputed by the accused is that there is no return memo of the said cheque in question placed on record by the complainant. The accused has not admitted the return memo of the cheque in question; and the same has been denied and disputed by the accused. To disprove the return memo on record, the accused had summoned a witness from bank DW 2 Sh. Prabuddha Kumar; who deposed that he had brought the bank statement of the complainant Ex DW2/A and that the cheque number of cheque in question is not reflected in the said bank statement. He deposed that the Ex CW1/C is not the cheque return memo, but the same is only a covering letter. To shift the onus of proof, the complainant had summoned the same bank witness as CW2 Sh. Prabuddha Kumar, who had brought the postage register from the bank to show that the cheque in question was sent on 3.12.2011 was sent out by the bank. Another bank witness, Sr. Manager, CW 3 Ms. Mala was also summoned, who had brought the statement of the account of the accused, for period 1.08.2011 to 29.02.2012 which was Ex. CW3/A; which reflected that the cheque in question was dishonoured on 01.09.2011.
25.After appreciating the testimonial evidence, documentary evidence is now perused. On perusal of the Ex CW3/A, it reflected that the cheque was dishonoured on 01.09.2011. The said Ex. CW 3/A does not reflect Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 15 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. that the cheque was dishonoured on 3.12.2011 or on any other dates in December or November. On perusal of the said cheque return memo Ex CW1/C, it appears that the same is not in typical fashion as the usual bank return memos are received; the same does not mention that is a cheque return memo, the same does not mention the branch of the bank by which it was drawn, the same is not carrying sign and seal of the bank, it does not reflect the bank account number of the complainant on which the same has been dishonoured. Ld. Counsel for the complainant has argued that this was the mistake of the bank to send the said kind return memo. Ld. Counsel for the accused, however, argued that it has been conclusively proved that the said memo is not a return memo but postal cover.
26.Having considered the arguments and evidence; the said bank return memo appears to be a postal cover letter rather than a return memo; the same has been supported by the witness DW2 by stating that is is a postal covering letter and not a cheque return memo, the bank statement of the complainant does not reflect that the said cheque in question was put for encashment, the bank statement of the accused reflected that the cheque in question was returned only on 01.09.2011, and not on the date of alleged cheque return memo 03.12.2011. However, there appears to be a postal register produced by the witness does show certain postage was Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 16 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. sent by the bank to the complainant on 3.12.2011, but that does not reflect the same is a return memo reflecting necessary particulars to be deemed as a return memo. Nothing prevented the complainant to call from the concerned bank with respect to the return memo to prove the same, however, no such witness was summoned that could depose that the Ex CW1/C was a cheque return memo. In fact, the witnesses that were called by the defense and the complainant deposed that the Ex. CW- 1/C is not a cheque return memo. In presence of the concrete witnesses, the complainant cannot be accorded the benefit u/s 146 of negotiable instruments act which provides for "The Court shall, in respect of every proceeding under this Chapter, on production of bank's slip or memo having thereon the official mark denoting that the cheque has been dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved", as on appreciation of evidence, it has been clearly proved by the accused that the alleged cheque return memo Ex CW1/C was infact not at a cheque return memo for the said cheque in question, and the same has been successfully disproved by the accused.
27.It would be apposite at this stage to briefly discuss law applicable to the offence of dishonour of cheque. For the offence under Section 138 of the Act to be made out against the accused, the complainant must prove the following points, that:
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 17 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
1. The cheque was drawn by a person on an account maintained by him for payment of money.
2. The said cheque has been issued in discharge, in whole or in part, of any legal debt or other liability.
3. The said cheque has been presented to the bank within a period of three months from the date of cheque or within the period of its validity.
4. The aforesaid cheque,when presented for encashment, was returned unpaid/dishonoured.
5. The payee of the cheque issued a legal notice of demand to the drawer within 30 days from the receipt of information by him from the bank regarding the return of the cheque.
6. The drawer of the cheque failed to make the payment within 15 days of the receipt of aforesaid legal notice of demand.
28.In the present case, there is no dispute regarding fulfilment of conditions (1),(3), and (6). In his notice u/s 251 Cr.P.C, the accused stated that he had only signed the cheque and particulars were not filled by him. The cheque pertains to his account, and he had issued the same to the complainant.
29.It is also not in dispute that the cheque was presented within the statutory period.
Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 18 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi.
30.Now the primary question that comes out after it has been concluded is that the cheque was not returned on 03.12.2011 as per the return memo relied upon by the complainant, whether the complainant had issued the legal demand notice to the accused within 30 days from the receipt of the information from the bank?
31.The complainant had relied upon only one cheque return memo Ex CW1/C; which had been disproved. There is no other return date that had been established by the complainant. The legal notice dated 29.12.2011 Ex. CW1/D is relied upon by the complainant, the only legal notice on record. The same implied that the cheque return information must have been received to the complainant from the bank latest by 29.11.2011; however, no such return memo has been established by the complainant in the present case. Therefore, it cannot be said that the said ingredient is proved that the legal demand notice was issued within 30 days from the receipt of notice of dishonour.
32.The fleeting question that emerges is whether this court could have condoned the delay for issuance of cheque? In the present case, the witness CW 3 has brought on record to suggest that the cheque in question was dishonoured on 01.09.2011; and legal notice is already on record Ex. CW1/D dated 29.12.2011. The same is outside the scope of 30 days as stipulated in the section 138 (b) NI act. Hence, the above question Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 19 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. has been answered in negative by the decision of Hon'ble Gujarat High Court in B.K. Sarkar And Anr. vs State Of Gujarat And Anr. 2008 CRILJ 1230 by holding that "Power to condone delay as provided under Section 142 of the N.I. Act is to be read and considered only with regard to delay in filing the complaint within period of one month and it cannot be extended to condone delay with regard to other lapses more particularly delay in issuing notice as contemplated under Section 138(b) of the N.I. Act.".
33.Therefore, it appears that the basic ingredient of the present case, that is issuance of the legal demand notice within 30 days from receipt of notice is not proved, it is not proved that the said cheque in question was returned on 03.12.2011, it has not been proved that the said cheque has been dishonoured in the account number of the complainant.
34.Thus, Now the basic and significant question for determination is:
Whether the accused had issued the cheque in question in discharge of legally enforceable debt or liability?
35.It is material to discuss that a negotiable instrument including a cheque carries following presumptions in terms of Section 118 (a) and Section 139 of the NI Act:Section 118 of the NI Act provides : "Presumptions as to negotiable instruments: Un- til the contrary is proved, the following presumptions shall be made: of consideration that every negotiable in- Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 20 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. strument was made or drawn for considera- tion, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred was accepted, indorsed, negotiated or transferred for consideration;" Section 139 of the N.I Act further provides as follows:"Presumption in favour of holder- it shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability." Thus, the combined effect of Section 118(a) and Section 139 of NI Act raises a presumption in favour of the holder of the cheque that he has received the same for discharge, in whole or in part of any debt or other liability. However, the said presumptions are rebuttable in nature.
36.In Rangappa V. Sri Mohan, (2010) 11 SCC 441, a three-judge bench of Apex Court observed that:- "Section 139 of the NI Act is stated to be an example of a reverse onus clause which is in tune with the legislative intent of improving the credibility of negotiable instruments. The Hon'ble Supreme Court further observed that the offence under Section 138 of the NI Act is at best a regulatory offence and largely falls in the arena of a civil wrong and therefore the test of proportionality ought to guide the interpretation of the reverse onus clause. The accused is not expected to discharge an unduly high standard of proof and he/she is only required to Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 21 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. raise a probable defence or creating doubt about the existence of a legally enforceable debt or liability for thwarting the prosecution. The standard of proof for doing so would be on the basis of "preponderance of probabilities".
37.Hon'ble Supreme Court in M/s Kumar Exports Vs. M/s Sharma Carpets AIR 2009 SC 1518 held that:"The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the Complainant in a criminal trial. However, the court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 22 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Section 118 and 139 of the Act."
38.The court has to now consider whether the accused has been successful in discharging the burden of proof. In the backdrop of legal position as enunciated above, it is to be examined by this Court that whether the accused on a scale of preponderance of probabilities has been able to rebut the presumption which has been raised against him and in favour of the complainant, or has been able to demolish the case of the complainant to such extent so as to shift the onus placed upon the accused again on the complainant. As held by Hon'ble Supreme Court of India in case of Kumar Exports vs Sharma Carpets (2009) 2 SCC 513, the accused can Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 23 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. either prove the non−existence of the consideration and debt by direct evidence or by bringing on record such facts and circumstances, upon consideration of which, the Court may either believe that the consideration and debt either did not exist or their non−existence was so probable that a prudent man may act upon the plea that they did not exist. If the Court comes to the conclusion that the accused has not been able to rebut the presumption raised against him by failing to bring on record direct evidence or by even failing to sufficiently perforate the case of the complainant, the complainant is entitled to a decision in his favour.
39.Now, the question before the court is whether the accused was able to successfully rebut the presumptions raised against him by direct evidence or by bringing on record such facts and circumstances; for the same the evidence on record has to be examined. The accused has taken stand in the defence at the stage of framing of notice and statement of accused u/s 313 CrPC that the said cheque in question that the cheque in question was security cheque given to the complainant, qua the agreement for sale. It is the defence of the accused that the complainant and accused had entered into the agreement for sale of a property, which stipulated that the complainant was supposed to make the balance payment of the said property within 45 days from the agreement, failing which the advance payment of Rs. 1,00,000/- would be forfeited by the accused, with counter Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 24 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. stipulation that in case the accused fails to make the purchase good, he would be liable to make the payment of double the amount of the advance payment.
40.In cross examination of CW1, he admitted that the said stipulation were the part of the agreement for sale. The CW1 also admitted that the dispute between both the parties arose before expiry of 45 days as property agreed by the accused was lesser in area than agreed, and balcony was covered. He also deposed that the said fact is not mentioned in the complaint. Complainant/ CW1 also agreed that no letter/ notice was given to the accused with respect to the said dispute that arose. The CW1 also agreed that no notice or letter was given to the accused to return the double the amount as per the agreement. CW1 also agreed that he did not go to the office of registrar after 45 days for completion of the agreement. The CW1 also agreed that he has not placed on record any document to prove that he had balance amount of Rs. 23,50,000/- in his bank account for purchase of the property. The complainant on other hand, did not bring any document to show case that he had issued any letter or notice to the accused rescinding the agreement for sale before expiry of 45 days, no evidence was brought on record to suggest that the contention of the complainant that the accused had defaulted on his promise of condition and parameters of flat in terms of the agreement; and complainant had Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 25 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. also failed to prove that he infact had the money in his account for purchase of the said flat. The accused had successfully shifted the onus on the complainant by questioning the basis on which the said legally enforceable debt existed. The agreement for sale clearly stipulated that in case the buyer backs out from the said purchase, the advance of Rs. 1,00,000/- was to be forfeited by the accused. Here, the complainant has admitted that infact he backed out from the said purchase and failed to go for purchase and registration of flat. Therefore, the accused had successfully rebutted the presumption raised against him; and complainant has failed to shift the onus. The accused has proved that said legally enforceable debt did not exist.
41.Having discussed the marshalling of evidence produced before this court, it comes to fore that in preponderance of probabilities; the complainant has failed to prove that the cheque in question was returned on 3.12.2011 and legal notice being issued within 30 days; and clear doubt raised by the accused on the existence of the legally enforceable debt.
42.Therefore, In the preponderance of probabilities, the accused was successful in rebuttal of the presumptions raised against him, and complainant failed to discharge his onus by failure to produce the evidence; and complainant has utterfly failed to prove the said cheque Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 26 / 27 In the court of Sh. Divyam Lila, MM East district, Karkardooma courts, Delhi. return memo and return of the cheque within the time stipulated in 138 (2) of NI act. Hence accused is acquitted.
Announced in the open Court today i.e 20-03-2024.
(DIVYAM LILA) MM(Municipal) East District Karkardooma Court/Delhi 20-03-2024 Copy of the judgment be provided to the parties as per rules, and copy of the judgment be also uploaded in the CIS server. Ct. Case no. 57207/2016 Yogender v. Jag Narayan Yadav Page no. 27 / 27