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[Cites 11, Cited by 0]

Delhi District Court

Sh. Shyam Sunder Khurana S/O Sh. Fateh ... vs Sh. Bijender Singh S/O Late Cap. ... on 26 August, 2011

                                                   ­1­

        IN THE COURT OF Ms. SUNITA GUPTA : DISTRICT JUDGE­CUM­
          ADDITIONAL SESSIONS JUDGE : INCHARGE­NE DISTRICT : 
                    KARKARDOOMA COURTS : DELHI :

Cr.(A) No. 10/11 & 11/11. 

Sh. Shyam Sunder Khurana S/o Sh. Fateh Chand, 
R/o H.No. 608, Ground Floor, 
Janta Flats, GTB Enclave, 
Delhi.                                                               .........Appellant

       Vs. 
Sh. Bijender Singh S/o Late Cap. Raghuvir Singh,
R/o D­49/26, Dilshad Colony, 
Ashray Apartments, Delhi.                           ........Respondent [Cr.(A) No.10/11]

M/s Raj Air Conditioner 
Through Its Prop.,  
Sh. Bijender Singh S/o Late Cap. Raghuvir Singh,
R/o D­49/26, Dilshad Colony, 
Ashray Apartments, Delhi.                           ........Respondent [Cr.(A) No.11/11] 

Date of Institution :­ 05.07.2011 (Common in both appeals)
Date of Reserving for Order :­ 05.08.2011 (­­do­­)
Date of Pronouncement :­ 26.08.2011 (­­do­­)

J U D G E M E N T :

­ Vide this common order, I shall dispose of two criminal appeals bearing Cr.(A) No. 10/11 and 11/11, as both appeal are between the same parties and substantially common question of law and facts are involved in both Cr.(A) No. 10/11 & 11/11 Page 1/19 ­2­ appeals.

2. Before going to the grounds of appeal, it will be in fitness of things to narrate the circumstances leading to the filing of present appeals.

3. Appeal No.10/11 has been filed by the appellant feeling aggrieved by the order dated 20.05.2011 vide which appellant was convicted for offence under section 138 of the Negotiable Instruments Act, 1881 and order dated 30.05.2011 vide which he was sentenced to undergo SI for one year and also to pay a sum of Rs.4 lac by way of compensation to the complainant within 45 days. In default of payment of compensation, he was to undergo SI for another six months.

4. Briefly stated facts giving rise to the filing of this appeal are that respondent­complainant filed a complaint under section 138 of the Negotiable Instruments Act, 1881 inter alia on the allegations that complainant and appellant were having friendly relations for last more than four years. Appellant requested the complainant for extending friendly loan of Rs.2.33 lac as his business was in doldrums and in order to recover from said situation he was in dire need of money. Appellant assured him that he will repay the loan amount in time and further offered to give post dated cheques towards repayment of loan amount. On the assurance and promise made by the appellant, complainant gave friendly loan of Rs.2.33 lac. The appellant issued post dated cheque, that is, cheque No. 248752 Cr.(A) No. 10/11 & 11/11 Page 2/19 ­3­ dated 18.09.2003 for Rs.2.33 lac, drawn on Kangra Co­operative Bank Ltd, 73A, A­Block, Jagatpuri, New Delhi, in favour of the complainant. The cheques were issued by the appellant to the respondent­complainant so as to discharge his liability towards the respondent­complainant. The cheque was deposited by the respondent­complainant for enchashment, but the same was returned unpaid by the bank with remarks "Funds Insufficient". Again cheque was deposited for encashment on 01.11.03 within the period of validity, but the same was returned unpaid by the bank of the appellant with remarks "payment stopped" by the drawer. The respondent­complainant gave legal notice dated 12.11.03 to the respondent­appellant demanding payment of returned cheque amount. The accused sent a reply dated 25.11.03 denying his liability to pay the amount. As such complaint was filed under section 138/142 of the Negotiable Instruments Act.

5. After summoning the appellant, notice under section 251 Cr.P.C was given to him, to which he pleaded not guilty and claimed trial.

6. In order to substantiate his case, respondent­complainant examined himself, besides that he examined CW2 Sh. Joginder Kumar, Head Manager, State Bank of India, Kashmere Gate and CW3 Sh. Yogesh Gopal Gupta, UDC, Vaish Co­operative New Bank Ltd, Darya Ganj Bank, New Delhi.

Cr.(A) No. 10/11 & 11/11 Page 3/19

­4­

7. Statement of appellant was recorded u/s 313 Cr.P.C in order to afford him an opportunity to explain the incriminating circumstances appearing against him, wherein he stated that he had some business relations with respondent­complainant. He had settled the dispute with regard to respondent­complainant on 30.08.03 by paying a sum of Rs.1.50 lac and the respondent­complainant had executed a receipt on the same day. Respondent­complainant was in possession of four blank cheques bearing No.248751 to 248754. However, despite receipt of Rs.1.50 lac, he did not return the cheques, rather filed a false complaint against the appellant. The cheques were given in blank, which were misused by the respondent­complainant for his oblique motive.

8. Appellant examined DW1 Sh. K.P. Sharma, Sr. Manager, Central Bank of India, and DW2 Raj Kumar and DW3 Sh. S.P. Singh in support of his case.

9. After hearing ld. counsel for the parties, ld. Trial Court observed that issuance of cheque by the appellant was not disputed. The legal presumption arises that cheque was drawn for consideration and although presumption is rebuttable, but it was for the appellant to rebut the presumption, which he failed to adduce. As regards the receipt of Rs.1.50 lac, it was observed that appellant has failed to prove the same, as such appellant was held guilty of the offence u/s 138 of the Negotiable Cr.(A) No. 10/11 & 11/11 Page 4/19 ­5­ Instruments Act and was sentenced as ordered above.

10. Feeling aggrieved by this order, present appeal has been filed.

11. Appeal No.11/11 was filed feeling aggrieved by the order dated 20.05.2011 vide which the appellant was held guilty of offence under section 138 of the Negotiable Instruments Act and order dated 30.05.2011 vide which accused was sentenced to undergo SI for a term of one year and was also directed to pay compensation of Rs.11 lac to be paid within 45 days. In default of payment of compensation, he was to further undergo SI for six months.

12. Facts giving rise to the filing of present appeal against impugned order are that a complaint was filed by the respondent­complainant on substantially similar ground on which another complaint was filed with the difference that in this appeal, it was alleged that friendly loan of Rs.5.50 lac was given to the appellant and in order to show his bonafide, appellant issued two post dated cheques, that is, cheque No. 248751 dated 12.09.03 for Rs.2.50 lac and cheque No. 248754 dated 29.09.03 for Rs.3 lac, and both these cheques were dishonoured on presentation and the payment was not made despite service of legal notice of demand.

13. Notice of both appeals were given to the respondent. Trial Court record was summoned.

14. I have heard Sh. V.K. Sharma, Advocate for the appellant and Sh. Cr.(A) No. 10/11 & 11/11 Page 5/19

­6­ Ruchir Batra, Advocate for the respondent and have perused the record.

15. It was submitted by ld. counsel for the appellant that claim of respondent does not match with details of bank account. Moreover, it was business transaction and settlement was arrived at between the parties for a total sum of Rs.1.50 lac, which was duly paid by the appellant and the receipt was executed by the respondent­complainant. He had withdrawn the same from bank and paid to the respondent­complainant. He had filed civil suit claiming return of cheques. However, after filing of suit since cheques were presented, therefore suit become infructuous and was dismissed. Although the appeal was filed, but he withdrew the appeal because in view of presentation of cheques, suit itself had become infructuous, therefore the appeal could not survive. Under these circumstances, it was submitted that impugned order is liable to be set­ aside.

16. Per contra, it was submitted by ld. counsel for the respondent that there was no business transaction between the parties. It was only a financial assistance, which was rendered by the respondent to the appellant. As regards receipt of Rs.1.50 lac, it was submitted that same is forged one and was not even relied upon by the ld. Civil Judge. Although the appeal was filed, but the same was withdrawn, therefore this finding has become final. Therefore, no reliance can be placed on this receipt. Cr.(A) No. 10/11 & 11/11 Page 6/19

­7­ Moreover, it was submitted that on the presentation of the cheque, civil suit did not become infructuous because civil suit was not confined to the cheques only, but also regarding blank papers and stamp papers. Only three cheques were involved. There were no four blank papers or stamp papers as alleged in the suit and therefore why the appeal was withdrawn by the appellant, if it had some merits. It was further submitted that appellant admitted his liability. He has also admitted his signatures on the cheque. That being so, it was for him to prove how he discharged his liability. Although he is trying to prove that he had withdrawn from bank a sum of Rs.1.50 lac, however as per record brought by DW1 a sum of Rs. 2.45 lac was withdrawn. Why Rs. 2.45 lac was withdrawn, if payment was to be made only for Rs.1.50 lac. As such it was submitted that statement of this witness does not help the accused. Further more, as regards the testimony of DW3 Sh. S.P. Singh, it was submitted the same does not help the appellant, inasmuch as, no document of the present complaint was examined by him and the receipt on which he relied upon was not even believed by the ld. Civil Judge. Therefore, it was submitted that impugned order does not suffer from infirmity, which call for interference, and as such appeal is liable to be dismissed.

17. I have given my considerable thoughts to respective submissions of the ld. counsels for the parties and have carefully perused the record. Cr.(A) No. 10/11 & 11/11 Page 7/19

­8­

18. In order to invoke provisions of section 138 of the Negotiable Instruments Act, it is necessary to fulfil following essential ingredients :­ (1) Drawing of a cheque by any person.

(2) The drawer of the cheque issued the cheque to discharge in whole or in part any legally enforceable debt or other liability. (3) The cheque so issued has been returned due to insufficiency of funds. (4) The drawer fails to make the payment within the stipulated time after service of demand notice.

19. Section 118 (a) of the Negotiable Instruments Act provides for presumption as to negotiable instruments regarding consideration as under :­ "That every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration."

Section 139 of the Negotiable Instruments Act provides for presumption in favour of holder, which reads as under :­ "It shall be presumed, unless 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, or any debt or other liability."

A con­joint reading of sections 138, 118(a) and 139 of the Cr.(A) No. 10/11 & 11/11 Page 8/19 ­9­ Negotiable Instruments Act goes to show that once a cheque is issued there is presumption in favour of holder of the cheque that he has received the same for discharge in whole or in pat of a debt or other liability. Under section 139 of the Negotiable Instruments Act, there is legal presumption that cheque was issued for discharging the debt or liability and that presumption can be rebutted only by the person, who drew the cheque. The aforesaid presumption is in favour of holder of the cheque. The presumption available under section 139 of the Negotiable Instruments Act can be shifted by the accused by adducing evidence. So the burden of proof is on the appellant and evidence available on record will have to be appreciated by bearing in mind the above fact regarding burden of proof.

20. Turning to the case in hand, it is the case of the respondent­ complainant that due to friendly relations between him and the appellant, a sum of Rs.2.33 lac was given by him to the appellant in lieu of which post dated cheque bearing No.248752 dated 18.09.2003 of Rs.2.33 lac drawn on account No. 1361 of Kangra Co­operative Bank Ltd was issued by the appellant in his favour towards repayment of loan amount. This amount was paid by him from his own account. Some of the amount was paid in cheque and some by way of cheque.

21. A sum of Rs.5.50 lac was paid by him out of funds of the company for which two cheques bearing No. 248751 and 248754 dated 12.09.03 Cr.(A) No. 10/11 & 11/11 Page 9/19 ­10­ and 29.09.03 for Rs.2.50 lac and Rs.3 lac respectively drawn on Kangra Co­operative Bank Ltd were given by the appellant. The entire payment was made on account of friendly relations with appellant on his request that his business was in doldrums and in order to recover from that situation, he was in dire need of money. It is not in dispute that when aforesaid cheques were presented for encashment, the same were initially dishonoured with remarks "insufficient funds" and subsequently with remarks "stop­payment" by the drawer. There is also no dispute that legal notice of demand was duly sent by the complainant which was duly received by the appellant and he also sent the reply but no payment was made.

22. It is the case of the appellant that it was business transaction and the settlement was arrived at a total sum of Rs.1.50 lac, which was paid to the complainant and in lieu of that a receipt was issued. Therefore, no amount remained due to the complainant.

23. As regards plea that there was a business transaction between the appellant and the respondent, it is pertinent to note that complainant in his examination­in­chief led by way of affidavit had categorically stated that it was a friendly loan to the accused. He was subjected to lengthy cross­ examination by ld. counsel for the appellant. Even no suggestion was given to the complainant that there was any business transaction between Cr.(A) No. 10/11 & 11/11 Page 10/19 ­11­ the two. Moreover, since this plea was taken by the appellant, it was for him to prove that there was business transaction between them. It is undisputed case of the parties that appellant had filed civil suit for mandatory and permanent injunction against the appellant alleging inter alia that they were good friends and having commercial dealings. A sum of Rs.1.50 lac was due towards plaintiff. The plaintiff had handed over four blank cheques bearing No. 248751, 248752, 248753 and 248754, blank papers and two blank stamp papers of Rs.4 and Rs.5 and it was settled that all the four cheques, blank papers and stamp papers shall be handed over by the defendant to the plaintiff after receiving full and final payment of Rs.1.50 lac. On 30.08.03, the plaintiff had paid a sum of Rs.1.50 lac to the defendant and receipt was also executed by the defendant, but despite assurance and demands defendant failed to return the blank cheques or papers. In that case accused (who was plaintiff in that case) was examined and on the Trial Court record copy of statement is available, in which he admitted that neither he purchased any goods from defendant nor defendant purchased anything from him. Under these circumstances, it was a mere a bald plea that it was a business transaction, which was not even proved by the appellant.

24. The next limb of plea taken by the appellant is that a settlement was arrived at between the parties for a total sum of Rs.1.50 lac and payment Cr.(A) No. 10/11 & 11/11 Page 11/19 ­12­ was made by him to the complainant, who issued receipt to this effect.

25. In order to prove this payment, he has examined DW1 K.P. Sharma, Sr. Manager, Central Bank of Indian, who brought photocopy of cheque Ex.DW1/1 for showing that after withdrawing amount from the bank, a payment of Rs.1.50 lac was made to the complainant. However, a perusal of cross­examination by DW1 Sh. K.P. Sharma revelas that he admitted that photocopy of cheque Ex.DW1/1 was not certified in accordance with Bankers Book of Evidence Act. Moreover, according to him, the photocopy of cheque Ex.DW1/1 shows that cheque was dated 29.08.03 and had been cleared for payment on 28.08.03 against DD of Rs.2.45 lac sent in for clearing on 27.08.03. If Rs.1.50 lac was only required to be paid in full and final settlement, it is not explained by the appellant as to why a sum of Rs.2.45 lac was withdrawn by him from the bank. As such it is not proved that payment was made after withdrawing the money from the bank.

26. Further more, complainant had denied settlement of any amount or execution of any receipt. Therefore, when civil suit was filed by the appellant against the complainant, then before the ld. Civil Judge, the appellant examined handwriting expert Sh. S.P. Singh, who deposed that receipt was executed by the complainant. However, a perusal of certified copy of judgement dated 27.02.09 pronounced by Sh. N.K. Malhotra, then Cr.(A) No. 10/11 & 11/11 Page 12/19 ­13­ Administrative Civil Judge, Karkardooma Courts, Delhi, goes to show that report given by the handwriting expert was meticulously examined by ld. Civil Judge and was not believed by him and it was held that it was not proved by the appellant that any settlement was arrived at between the parties or a receipt was executed by the complainant and therefore the suit was dismissed. Sh. S.P. Singh, Handwriting Expert, was also examined by the appellant before ld. Metropolitan Magistrate, however it was admitted by him that he did not examine any documents of the present complaint case. Therefore, in absence of examining any document pertaining to the present case, his examination was without any merit. Moreover, he admitted in his cross­examination that report given by him before the Civil Judge was not even believed by the Civil Court. As such, the appellant does not get any benefit from his testimony.

27. Further, in order to prove that a sum of Rs.1.50 lac was paid by him in full and final settlement, appellant examined his younger brother DW2 Raj Kumar, who in his affidavit stated that there were business dealings between complainant and the accused and an amount of Rs.1.50 lac was due towards the complainant and on 30.08.03, accused p aid this amount in his presence and receipt was executed by the complainant in his presence. However, demeanour of this witness is worth noting, inasmuch as, at the outset of his cross­examination he deposed that accused was Cr.(A) No. 10/11 & 11/11 Page 13/19 ­14­ living at 1227, Dilshad Garden, Delhi, while he was living at H.No. 34/141, Trilokpuri, near Saibaba Mandir, Delhi, for last about three years. He went on stating that they last resided together in the same house in the year, 2003 at Vaishali, Ghaziabad, U.P., and then admitted that he is living separately from accused since January 2005 and went on stating that since childhood, he is living separately from accused in a separate house.

28. Further more, although in examination­in­chief he had deposed that there were business transaction between the complainant and the accused, however in cross­examination he pleaded his ignorance about the business dealing or financial matters of the accused. He could not even say as to when cheque Ex.CW1/1 was issued by the accused and receipt for which transaction or dealing was issued. Moreover, he feigned ignorance as to whether his brother had filed any civil suit No. 107/06 against the complainant claiming relief of mandatory and permanent injunction and went on stating that he never appeared in any other Court to give evidence in support of his brother. He further deposed that except the present complaint, he had not given evidence in other Court in any other matter. The witness was then confronted with certified copy of his statement Ex.DW2/DX1 and then admitted that same bears his signatures. Even despite admitting his signatures on his statement, he kept on stating that he does not remember if his brother had filed any civil Cr.(A) No. 10/11 & 11/11 Page 14/19 ­15­ suite in which he appeared as witness or his statement was recorded. Under these circumstances, conduct of the witness makes it clear that he is not worthy of credit. Being brother of the appellant, he came to depose before the Court, but no implicit reliance can be placed on the testimony of this witness.

29. Moreover, as stated above, in the civil suit filed by the appellant against the complainant­respondent heavy reliance was placed on this receipt, which was not believed by the ld. Trial Court, and as such his suit was dismissed. It is not in dispute that appeal was preferred against the said order. But the same was withdrawn. With the result, the finding of the ld. Civil Court had attained finality. It was submitted by ld. counsel for the appellant that since cheques had been presented, therefore civil suit was dismissed and for the same reason the appeal was withdrawn by him. This submission again is devoid of merits, inasmuch as, perusal of certified copy of judgement goes to show that civil suit was not confined to blank cheques, but it was pertaining to four blank cheques, three blank papers and two blank stamp papers. Moreover, it was not dismissed as having become infructuous due to presentation of cheques, but was dismissed on merits. Further, it is not explained as to why appeal was withdrawn even regarding those three blank papers, two blank stamp papers and one other cheque which was not subject matter of the present Cr.(A) No. 10/11 & 11/11 Page 15/19 ­16­ complaint. That being so, the submission of ld. counsel for the appellant is devoid of merits and the net result is that findings of the ld. Civil Judge had attained finality and the appellant failed to prove that any final settlement was arrived at between the parties in pursuance to which a sum of Rs. 1.50 lac was paid by him or any receipt was issued by the complainant.

30. Much emphasis has been laid by the ld. counsel for appellant for submitting that bank details furnished by the complainant does not tally with the amount of cheque and therefore it is not proved that aforesaid amount was given as friendly loan to the appellant. In this regard it may be mentioned that it has come in the testimony of complainant that some of the amount was also paid by him in cash and therefore even if the amount does not tally fully, it does not mean that friendly loan was not given by him to the accused.

31. Moreover, a perusal of judgement passed by Sh. N.K. Malhotra, ld. Administrative Civil Judge, goes to show that in the civil suit filed by the appellant, complainant (who was defendant in that case) had taken the same plea that he had extended friendly loan of Rs.7,83,000/­ to the plaintiff and that a sum of Rs.5,50,000/­ was given from his sole proprietorship firm and another sum of Rs.2,33,000/­ was given from his personal account. One of the issue framed in that case was whether any friendly loan of Rs.7,83,000/­ was advanced by the defendant to the Cr.(A) No. 10/11 & 11/11 Page 16/19 ­17­ plaintiff and this issue was decided in favour of defendant and against the plaintiff. As stated above, this finding has attained finality. Therefore this also goes against the appellant that no friendly loan was taken by him from the plaintiff.

32. The result of the aforesaid discussion is that plea of the appellant that it was a business transaction between the parties and accounts were duly settled on the payment of Rs.1.50 lac is not substantiated. On the other hand, case of the complainant is that pursuant to friendly loan given by him to the appellant, three cheques were issued by the appellant, and the same stands admitted, inasmuch as, it is not disputed by the appellant that cheques were not signed by him. Once the cheques bearing his signatures were issued by him in favour of the complainant, under section 118(a) of the Negotiable Instruments Act there is a presumption that cheques were issued for consideration and it was for the appellant to rebut the presumption, which the appellant has miserably filed to rebut. The three witness examined by him do not prove his case. He himself has failed to appear in the witness box to substantiate his case.

33. In V.S. Yadav vs. Rani, 172 (2010) DLT 561, it was held that statement of accused u/s 281 Cr.P.C. or u/s 313 Cr.P.C is not evidence of the accused and it cannot be read as part of evidence. Accused has an option to examine himself as a witness. His statement u/s 281 Cr.P.C or Cr.(A) No. 10/11 & 11/11 Page 17/19 ­18­ u/s 313 Cr.P.C cannot be read as evidence of accused and it has to be looked into only as explanation of incriminating circumstances and not as evidence. It was further observed that in order to rebut the presumption u/s 138 of the Negotiable Instruments Act, accused by cogent evidence has to prove circumstances under which the cheque was issued.

34. In the instant case, appellant has failed to examine himself and has also failed to prove as to on what account the bank cheques signed by him were handed over to the complainant.

35. Result of the aforesaid discussions is that appellant has failed to rebut the presumption which goes against him. On the other hand, complainant was able to prove that a sum of Rs.2.33 lac and Rs.5.50 lac was given by him to the appellant towards friendly loan. In discharge of his liability, appellant gave him post dated cheques which were dischonoured on presentation and despite service of notice of demand, he failed to pay cheque amount. As such, ld. Trial Court rightly came to the conclusion that complainant was able to prove all essential ingredients of section 138 of the Negotiable Instruments Act, and appellant was accordingly convicted of the offence u/s 138 of the Negotiable Instruments Act. There is no infirmity in the order dated 20.05.2011 passed by ld. Trial Court, which calls for interference.

36. As regards order on sentence dated 30.05.2011, absolutely no Cr.(A) No. 10/11 & 11/11 Page 18/19 ­19­ arguments were addressed on the quantum of sentence. Even otherwise, there is no infirmity in this part of the order also, which calls for any interference.

37. Result of the aforesaid discussions is that there is no merit in the appeals. Both the appeals are, accordingly, dismissed.

38. A copy of this order be kept in the connected appeal. A copy of this order along with Trial Court record be sent back. Appeal files be consigned to Record Room. 

Announced in the Open Court                                           (Sunita Gupta)
          th

On this 26 day of August, 2011. District Judge­cum­ASJ, I/C­NE, Karkardooma Courts, Delhi.

Cr.(A) No. 10/11 & 11/11 Page 19/19