Delhi District Court
M/S Fch Travel Services Pvt. Ltd vs Sea Crest International Llc And Ors on 21 March, 2025
DLST020175112018
IN THE COURT OF SH. AAKASH MOHAN SINGH, JMFC-05,
N.I. ACT, SOUTH DISTRICT, SAKET, NEW DELHI
CC No. : 7974/2018
U/s : 138 N. I. Act
PS : Mehrauli
FCH Travel Services Pvt. Ltd. vs. Sea Crest International
JUDGMENT
1. CC No. : 7974
2. Date of institution of the case : 02.06.2018
3. Name of complainant : FCH Travel Services Pvt. Ltd.
through its director/AR
Sh. Taiyab Ali,
Office at D-12B, 1st Floor,
Chattarpur, New Delhi.
4. Name of accused, parentage Accused no. 1 company
and address : Sea Crest International LLC
30 Wall St. Floor 8,
New York, NY-10005, USA.
NOT SUMMONED
Accused no. 2 Biren Kapoor
(Partner/director of accused
no. 1 company)
NOT SUMMONED
Accused no. 3 Saurabh Tyagi
(Partner/director of accused
no. 1 company)
5. Offence complained of : 138 N. I. Act
CC No. 7974/18 (Aakash Mohan Singh)
FCS Travel Services vs. Sea Crest International Page no 1 of 17 JMFC-05 (NI Act)/South
DLST020175112018
6. Plea of accused : Accused pleaded not guilty
7. Final order : CONVICTION
8. Date on which order was : 04.03.2025
reserved
9. Date of pronouncement : 21.03.2025
THE CONVICT HAS THE RIGHT TO AVAIL FREE LEGAL AID AS PER ENTITLEMENT IN ORDER TO PURSUE REMEDY BEFORE THE APPELLATE COURT/APPROPRIATE FORUM OF LAW.
THE CONVICT MAY CONTACT THE FOLLOWING :
O/o Ld. Secretary, DLSA-South, Room No. 309, 3rd Floor, Saket Court Complex, New Delhi.
Contact No. 011-29562440, [email protected] FACTUAL BACKGROUND OF THE CASE
1. Vide this judgment, this Court shall dispose off the present complaint case instituted by the Complainant invoking the provisions of Section 138 of the Negotiable Instruments Act, 1881(as in after referred to as NI Act).
2. The facts giving rise to the instant complaint case, as per the complainant, may be summarized as hereafter: That M/s Flight Tactix LLC have authorised M/s FCH Travel Services Pvt. Ltd. vide agreement dt. 01.09.2017 to collect any dues/debts from vendors, suppliers and associates etc. on its behalf in India. That complainant is a private limited company and engaged in the business of travelling services and appointed its AR Taiyyab Ali. That accused no. 3 had CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 2 of 17 JMFC-05 (NI Act)/South DLST020175112018 approached the complainant for taking the authorisiation of service IDs for Sea Crest International for airlines ticket bookings on terms and conditions agreed between both the parties vide agreement dt. 18.04.2017 executed on 25.04.2017.
That as per the said agreement, accused agreed to pay the 7000 USD as a security amount to complainant for getting the authorisation of ticket booking IDs, out of which initially accused have paid the part security amount of 3000 USD through cheque no. 026012881. That initially on the request of accused vide email dt. 06.05.2017, complainant had issued 4 IDs in the name of Saurabh Tyagi, Randeep Singh Oshan, Amit Sharma and Nishant Sahu. Later on on the request of accused vide email dt. 06.07.2017, two more IDs were issued to accused in the name of Abhijeet Rana and Suresh Tyagi. That authorisation of total IDs were given to accused and accused started working on these ID. That sometime, accused worked as per the terms of agreement dt. 25.04.2017 so as the complainant used to regularly, without fail, transfer the agreed amount in the account of accused. But later on accused started misusing the cards of their customers on the IDs authorised to accused by the complainant, thereby breach the agreement as the complainant had received heavy charge back from the bank on the booking done by the accused on above IDs. That from December, 2017 onwards complainant noticed the heavy charge back in transactions and same is intimated to accused from time to time. That complainant immediately notified the accused regarding the charge back through email/notice regarding the same upon which accused had promised the complainant to pay 20,000 USD by 28.12.2017, however he did not pay any amount to the complainant. That complainant blocked/closed the IDs and terminate the agreement through email dt. 16.03.2018 due to the breach of agreement CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 3 of 17 JMFC-05 (NI Act)/South DLST020175112018 condition. Thereafter complainant approached the accused for the payments of his loss of Rs. 32,52,964/- caused due to the fraud done by the accused. To discharge his part liability, accused had issued 3 cheques bearing no. 000013 dt. 07.03.2018 for Rs. 8 lacs, 000015 dt. 02.04.2018 of Rs. 9 lacs both drawn on HDFC Bank, Gurgaon and cheque bearing no. 000002 dt. 20.03.2018 of Rs. 8 lacs drawn on Kotak Mahindra Bank, Rohini Branch (hereinafter referred as cheques in question) in favour of the complainant. That when complainant presented the abovesaid cheques in question for encashment, same were returned unpaid with remarks "Funds Insufficient qua cheque no. 000015 & 000002, Alteration required drawer authentication qua cheque no. 000013" on 18.04.2018. Thereafter, after several reminders made by the complainant to pay the cheques amount, accused did not pay any heed to the same. Lastly, complainant issued a legal demand notice dated 02.05.2018 calling upon the accused to pay the amount of the aforesaid cheque within the stipulated period but the accused did not make the payment within the statutory period.
PROCEEDINGS BEFORE COURT
3. The complainant tendered his evidence by way of affidavit and relied upon following evidences:-
a) Copy of agreement dt. 01.09.2017 Ex. CW1/1
b) Copy of board resolution and MOU Ex. CW1/2 & CW1/3
colly.
c) Copy of agreement dt. 25.04.2017 Ex. CW1/4
CC No. 7974/18 (Aakash Mohan Singh)
FCS Travel Services vs. Sea Crest International Page no 4 of 17 JMFC-05 (NI Act)/South
DLST020175112018
d) Copy of cheque no. 026012881 Ex. CW1/5
e) Copy of email dt. 06.05.2017 & 06.07.2017 Ex. CW1/6 & CW1/7
f) List of PNRs alongwith copy of emails from Ex. CW1/8 colly.
consolidator
g) Copy of email dt. 16.03.208 & 21.12.2017 Ex. CW1/9 & CW1/10
h) Copy of notice dt. 04.04.2018 Ex. CW1/11
i) Cheques in question Ex. CW1/12, CW1/13 &
CW1/14
j) Return memos Ex. CW1/15, CW1/16,
CW1/17, CW1/18,
CW1/19 & CW1/20
k) Legal demand notice dt. 02.05.2018 Ex. CW1/21
l) Postal receipts Ex. CW1/22, CW1/23 &
CW1/24
m) Tracking report Ex. CW1/25
n) Reply of accused to legal demand notice Ex. CW1/26
o) Certificate u/s 65B of Evidence Act Ex. CW1/27
p) Evidence Affidavit Ex. CW1/A
q) Complaint Ex. CW1/B
4. Upon appreciation of pre-summoning evidence, accused was summoned for an offence punishable under Section 138 of NI Act and notice under Section 251, Code of Criminal Procedure, 1973 (herein after referred to as Cr.P.C.) was served upon accused on 16.01.2019 to which he pleaded not guilty and claimed trial. The accused took the defence that agreement was not executed with complainant but M/s Fligh Tactix LLC and all the 3 cheques in question were not CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 5 of 17 JMFC-05 (NI Act)/South DLST020175112018 issued by him but were taken from him forcibly qua which he lodged a complaint in PS-Begumpur, Rohini. He further deposed that in first week of March 2018, 4 persons namely Taiyab Ali, Sachin Tyagi, Harjeet Singh and one more person came to his house to threaten him and took the cheques from him forcibly. He further deposed that these persons forced him to fill the cheques and signed the same. He further deposed that he has no liability to pay the cheques amount to the complainant.
5. Thereafter, plea of accused under Section 145 (2) of NI Act was allowed vide order dated 16.01.2019 and the accused was granted opportunity to cross examine the complainant as well as his witnesses, if any.
6. The complainant has only examined himself as CW1. In the post summoning evidence, the complainant (CW1) has adopted his pre- summoning evidence. The complainant was cross examined at length by the Ld. Counsel for accused. CE was closed vide order dated 02.04.2019.
7. Accused person was, thereafter, examined U/s 281 r/w Sec 313 Criminal Procedure code, 1872 on 26.04.2019 wherein entire incriminating evidence was put to him. The accused took defence that he has no liability towards the cheques in question.
CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 6 of 17 JMFC-05 (NI Act)/South DLST020175112018
8. Accused has examined himself as DW-1 after allowing the application u/s 315 CrPC and defence evidence was closed on 31.08.2022 and the matter was fixed for final arguments.
9. I have considered the rival submissions of the parties and perused the entire evidence led by the parties and the material available on record.
FINAL ARGUMENTS
10. During the course of final arguments, Ld. Counsel for complainant argued that there exists during enforceable liability towards the complainant on behalf of the accused as all the ingredients of section 138 NI Act are fulfilled and accused should be convicted for the offence. Further argued that since the accused had admitted the signatures on the cheque in question and further admission of part liability vide Ex.CW1/10, the accused has failed to rebut the presumption raised against him.
11. Per contra, Ld. Counsel for accused argued that the essential ingredient of Section 138 NI Act are not fulfilled in order to constitute a valid complaint as the accused have no liability towards the complainant to pay the cheque amount as there was no direct agreement between the complainant and the accused no.3 and further, the accused no.3 was working as a freelancer for accused no.1 company, the accused no.3 would not be liable.
INGREDIENTS OF OFFENCE AND DISCUSSION CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 7 of 17 JMFC-05 (NI Act)/South DLST020175112018
12. Before dwelling into the facts of the present case, it would be apposite to discuss the legal standards required to be met by both sides. In order to establish the offence under Section 138 of NI Act, the prosecution must fulfill all the essential ingredients of the offence. Perusal of the bare provision reveals the following necessary ingredients of the offence:-
First Ingredient: The cheque was drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity;
Second Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability;
Third Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank;
Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of cheque from the bank;
Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
It is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the NI Act CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 8 of 17 JMFC-05 (NI Act)/South DLST020175112018
13. The accused can only be held guilty of the offence under Section 138 NI Act if the above-mentioned ingredients are proved by the complainant co- extensively. Additionally, the conditions stipulated under Section 142 NI Act have to be fulfilled.
PROVING OF INGREDIENTS
14. Notably, there is no dispute qua the proof of first, third, fourth and fifth ingredient. The complainant had proved the original cheques vide Ex.CW1/12 to Ex.CW1/14 which the accused had not disputed as being drawn on the account of the accused. It was not disputed that the cheque in question was presented within its validity period. The cheque in question was returned unpaid vide return memos Ex. CW1/15 to Ex.CW1/20. which has also not been disputed. The accused has admitted receipt of legal demand notice in statement u/s 294 CrPC. Further, in view of the presumption u/s 27 of the General Clauses Act, 1897, Ex.CW1/21 to Ex.CW1/25 (legal notice, postal receipt and tracking report) alongwith the ratio laid down in the case of "C. C. Alavi Haji Vs. Palapetty Mohd. & Anr(Supra), I am of the considered opinion that the fourth ingredient of the offence stands proved. Further, the fifth ingredient as such the same is deemed to be proved that no payment has been made after issuance of legal demand notice.
RAISING OF PRESUMPTION
15. The accused has also admitted the signatures over the cheques in question in admission-denial of documents u/s 294 CrPC and in his cross examination as DW-1.
CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 9 of 17 JMFC-05 (NI Act)/South DLST020175112018
16. As per the scheme of the NI Act, once the accused admits signature on the cheque in question, certain presumptions are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. Another presumption is enumerated in Section 139 of NI Act laying down the presumption that the holder of the cheque received it for the discharge, in whole or part, of any debt or other liability.
17. The combined effect of these two provisions is a presumption that the cheque was drawn for consideration and given by the accused for the discharge of debt or other liability. Both the sections use the expression "shall", which makes it imperative for the court to raise the presumptions, once the foundational facts required for the same are proved. Reliance is placed upon the judgment of the Hon'ble Supreme Court, Hiten P. Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16, Kumar Exports vs. Sharma Carpets (2009) 2 SCC 513 and Bir Singh vs. Mukesh Kumar (2019) 4 SCC 197.
18. Therefore, in the instant case, since the accused has admitted his signatures on the cheque in question, the aforementioned statutory presumptions would be raised in favour of the complainant regarding the fact that the impugned cheque has been drawn for consideration and issued by the accused in discharge of legally enforceable debt.
CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 10 of 17 JMFC-05 (NI Act)/South DLST020175112018 APPRECIATION OF EVIDENCE QUA SECOND INGREDIENT (EXISTENCE OF LEGALLY ENFORCEABLE DEBT/LIABILITY)
19. The presumptions contemplated in the NI Act are rebuttable presumptions and once the same are raised, it is for the accused to rebut the same by establishing a probable defence. The principles pertaining to the presumptions and the onus of proof were recently summarized by the Hon'ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5 SCC 418 as under:
"25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability. 25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely."
20. In the instant case, the complainant has sought to enforce the liability of the accused on the strength of agreement Ex.CW1/4 viz. agreement between the Flight Taxtix (sister concern of the complainant) and the accused no.1 company vide clause 6.4 wherein the accused would be liable to return the excessive chargeback amount. The details of the said amount have been furthered vide Ex.
CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 11 of 17 JMFC-05 (NI Act)/South DLST020175112018
CW1/8 and Ex. CW1/9 respectively. Since a presumption as envisaged u/s 118 and 139 of the Negotiable Instruments Act is attracted in favour of the Complainant as such, it is now incumbent upon the accused to rebut the said presumption on the basis of preponderance of probabilities.
21. In order to rebut the same, the primary defence of the accused no.3 is that he had no direct agreement with the complainant. However, perusal of record shows that vide Ex.CW1/1, the said Flight Tactix co. has authorized the complainant to the effect of transacting and recovering its dues vide point 2.II and clause 3. Therefore, the complainant has stepped in the shoes of the Flight Tactix on the strength of the same. Further, the accused no.3 has also admitted in his cross-examination that the complainant is a sister concern of the said Flight Tactix co. He has further admitted Ex.CW1/4 viz. the agreement between the Flight Tactix and the accused no.1 company. He has also admitted the approaching of the accused no.1 company to the Flight Tactix through himself in his statement u/s 313 CrPC. Ex.CW1/4 also reveals the designation of the accused no.3 as the Director/Partner of the accused no.1 company. He has also admitted Ex.CW1/6 and Ex.CW1/7 wherein IDs are sought to be generated for use on behalf of the accused no.1 company. Therefore, since complainant was authorized by the Flight Tactix and the accused no.3 authorized by the accused no.1 company, the defence that there was no direct agreement between the two would not survive.
22. Further, the accused no.3 has stated that the cheques in question were taken forcibly from him by the complainant. The mail Ex.CW1/10 is also stated to CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 12 of 17 JMFC-05 (NI Act)/South DLST020175112018 be sent forcibly. However, the accused no.3 has admitted in his cross-examination that he has neither issued the stop payment instructions nor did he place on record any police complaint to the effect. Such coercion has also not been proved otherwise by leading of independent evidence.
23. The accused no.3 has also admitted to be in correspondence with the email id of the complainant on behalf of the accused no.1, relied upon by the complainant. He has also admitted that he used to usually correspond by email on behalf of the accused no.1 company. On the other hand, he has claimed to be a freelancer and not an employee of the accused no.1 company. Interestingly, during his cross-examination he has also admitted to be the general employee of the accused no.1 company.
24. The accused no.3 has also attempted to impeach the case of the complainant by thoroughly cross-examining CW1. However, the line of defence has been the non-existence of a direct contract between the accused no.3 and the complainant. The process of booking of flights by the customers has also been dealt with. However, in view of raising of presumption and admission of part liability vide Ex.CW1/10, the same is inconsequential.
25. Insofar as the contention that the cheques in question have been issued from the personal account of the accused no.3 and therefore, accused no.1 would not be liable therefore making accused no.3 also not liable is concerned, since there is no privity of consideration as per the Indian Contract Act, 1872, the accused no.3 CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 13 of 17 JMFC-05 (NI Act)/South DLST020175112018 could have lawfully issued his personal cheques in discharge of liability of accused no.1 company. Accused no.3 has also not averred any other personal transaction with the complainant in pursuance of which cheques in question would have been handed over to the complainant. He has also failed to explain the possession of the cheques in question with the complainant apart from averring coercion without proof of the same. The accused no.3 is merely attempting to take a corporate veil in order to shield himself from liability by averring himself to be a freelancer, general employee, coercion etc. Therefore, the same is also unsustainable.
26. It has been held by Hon'ble Supreme Court in the judgment of "Rajesh Jain Vs. Ajay Singh Criminal Appeal No. 3126 Of 2023 (@ Special Leave Petition (Crl.) No.12802 of 2022" that:
55. ...Once the presumption under Section 139 was given effect to, the Courts ought to have proceeded on the premise that the cheque was, indeed, issued in discharge of a debt/liability. The entire focus would then necessarily have to shift on the case set up by the accused, since the activation of the presumption has the effect of shifting the evidential burden on the accused. The nature of inquiry would then be to see whether the accused has discharged his onus of rebutting the presumption. If he fails to do so, the Court can straightaway proceed to convict him, subject to satisfaction of the other ingredients of Section 138. If the Court finds that the evidential burden placed on the accused has been discharged, the complainant would be expected to prove the said fact independently, without taking aid of the presumption. The Court would then take an overall view based on the evidence on record and decide accordingly.
56. At the stage when the courts concluded that the signature had been admitted, the Court ought to have inquired into CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 14 of 17 JMFC-05 (NI Act)/South DLST020175112018 either of the two questions (depending on the method in which accused has chosen to rebut the presumption): Has the accused led any defense evidence to prove and conclusively establish that there existed no debt/liability at the time of issuance of cheque? In the absence of rebuttal evidence being led the inquiry would entail: Has the accused proved the nonexistence of debt/liability by a preponderance of probabilities by referring to the 'particular circumstances of the case'?"
62. The fundamental error in the approach lies in the fact that the High Court has questioned the want of evidence on part of the complainant in order to support his allegation of having extended loan to the accused, when it ought to have instead concerned itself with the case set up by the accused and whether he had discharged his evidential burden by proving that there existed no debt/liability at the time of issuance of cheque.
27. Therefore, in the totality of circumstances, the complainant has proved the liability upon the accused vide Ex.CW1/8 to Ex.CW1/9, acknowledgment of the same by the accused vide Ex.CW1/10 and presumption in his favour whereas the accused has not brought any cogent evidence on record to prove the case set up by him neither has he impeached the case of the complainant and consequently, it can be said that the accused has failed to rebut the presumptions of law raised against him in the present case. The version put forward by the accused is not believable and does not hold water with this court and the accused has failed to create a probable doubt to rebut the presumptions through the cross examination of the complainant or by way of independent evidence and accordingly, the defence taken by the accused does not find merit. Consequently, it can be said that the cheque in question was issued by the accused CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 15 of 17 JMFC-05 (NI Act)/South DLST020175112018 in discharge of legally recoverable debt/liability owed towards the complainant thus, the second ingredient to the offence under section 138 of NI Act also stands proved.
CONCLUSION:
28. To recapitulate the above discussion, the complainant has been successful in establishing his case beyond reasonable doubt with the aid of presumptions of law raised in his favor under section 118 and 139 of the NI Act by and other evidence. In the result of the analysis of the present case, the accused no.3 Saurabh Tyagi stands CONVICTED of the offence punishable under Section 138, Negotiable Instruments Act, 1881.
29. This judgment contains 17 pages. This judgment has been signed and pronounced by the undersigned in open court.
30. Let a copy of the judgment be given free of cost to the convict.
31. Let a copy of the judgment be uploaded on the official website of District Courts, South, Saket forthwith.
32. The convict has a right to suspension of sentence for the statutory period and to prefer an appeal against the present judgment. He is also at liberty to avail the services of District Legal Services Authority, South, as per entitlement, in CC No. 7974/18 (Aakash Mohan Singh) FCS Travel Services vs. Sea Crest International Page no 16 of 17 JMFC-05 (NI Act)/South DLST020175112018 case he cannot afford the professional fee of an advocate. The contact details of the authority have been mentioned on the covernote of this judgment.
AAKASH Digitally
by AAKASH
signed
MOHAN MOHAN SINGH
Date: 2025.03.21
SINGH 16:08:59 +0530
ANNOUNCED IN THE OPEN (AAKASH MOHAN SINGH)
COURT ON 21.03.2025 JMFC-05/NI ACT/SOUTH/DELHI
NEW DELHI
CC No. 7974/18 (Aakash Mohan Singh)
FCS Travel Services vs. Sea Crest International Page no 17 of 17 JMFC-05 (NI Act)/South