Delhi District Court
(Refer :- "Rangappa vs . Sri Mohan" Slp (Crl.) 407/06, Dated:- ... on 28 August, 2012
IN THE COURT OF SHRI SATVIR SINGH LAMBA, MM-01
( NEGOTIABLE INSTRUMENTS ACT) WEST DISTRICT,
TIS HAZARI COURTS, DELHI
Shri Manoj Kumar Vij,
Proprietor M/s M & S Allied Graphics,
110-B, Cycle Market,
Jhandewalan Extension, Phase I,
New Delhi.
(through Shri Sandeep Vij) ......Complainant
Versus
Shri Rakesh Bhatia
Proprietor of M/s A.P.R Trading Company,
B-3/9, Model Town,
New Delhi. ........Accused
JUDGMENT
Complainant Case No. : 2143/1 Date of institution : 28.11.2005 Date of commission of offence : 16.11.2005 Offence alleged : Under Section 138 NI Act Plea of the accused : Not pleaded guilty Final order : Conviction Date of Decision : 28.08.2012 CC No.2143/1/1 Page No.1/16 Brief Facts
1. Brief facts of the case are that complainant is the proprietor of M/s M & S Allied Graphics and is dealing in printing press material and other related goods. The complainant has authorized his brother Shri Sandeep Vij to file the present complaint case by way of General Power of Attorney dated 28.11.2005 i.e. Ex.CW1/1. It is alleged that accused has business dealing with the complainant and accused used to purchase various goods from the complainant from time to time. It is further alleged that on 14.01.2005 the accused purchased goods worth Rs.11,320/- by vide bill no.12365 i.e. Ex.CW1/2. The goods were taken by the accused on credit and promise was made that the payment shall be made at the earliest. Thereafter, also goods were purchased by the accused on 23.05.2005 vide bill no.12448 for Rs.8,708 i.e. Ex.CW1/3, on 19.04.2005 goods worth Rs.31,554/- were purchased vide bill no.T-13 i.e. Ex.CW1/4 , goods worth Rs.32,252/- were purchased vide bill no.T-14 i.e. Ex.CW1/5 from the complainant. In order to discharge the liability towards the bill Ex.CW1/2 and Ex.CW1/3, the accused issued two post dated cheques bearing no.679742 dated 15.07.2005 for the sum of Rs.11,320/- drawn on Oriental Bank of Commerce, G.T.Karnal Road, Delhi i.e. Ex.CW1/6 and cheque bearing no. 679744 dated 08.08.2005 amounting to Rs.8,708/- drawn on Oriental Bank of Commerce, G.T.Karnal Road, Delhi i.e. Ex.CW1/7.
2. It is alleged that the accused made further purchases on 09.05.2005 vide bill no.T-37 for Rs.19,622/- and vide bill no.T-54 dated 21.05.2005 i.e. Ex.CW1/9 goods worth Rs.28,126/- were purchased. It is further CC No.2143/1/1 Page No.2/16 alleged that after the above said transaction the accused was required to pay an amount of Rs.1,11,554/- towards the bill no.T-13 Ex.CW1/4, T-14 Ex.CW1/5 T-37 and T-54 Ex.CW1/9. In order to discharge the said outstanding amount accused handed over post dated cheques bearing no.679788 dated 05.09.2005 for the sum of Rs.90,000/- and cheque bearing no.679800 dated 20.09.2005 for the sum of 21554/-, both drawn on Oriental Bank of Commerce, G.T.Karnal Road, Delhi i.e. Ex.CW1/10 and Ex.CW1/11 respectively.
3. Complainant presented the cheques in question in his bank for encashment through his banker but the same were got dishonored by the banker of accused unpaid with the remarks "Funds Insufficient" vide returning memo dated 24.10.2005 i.e. Ex.CW1/12 to Ex.CW1/12D & Ex.CW1/13.
4. Henceforth the complainant issued the mandatory notice U/s 138 NI Act dated 27.10.2005 i.e. Ex.CW1/14 vide registered AD/UPC i.e. Ex.CW1/15 Ex.CW1/16 and Ex.CW1/17 respectively.
5. When the accused failed to fulfill the conditions of the said legal notice i.e. Ex.CW1/14 within 15 days of its presumed service, then the complainant has filed the present complaint case U/s 138 of Negotiable Instrument Act 1881 (hereinafter the Act) against the accused.
CC No.2143/1/1 Page No.3/16Pre-Trial Procedure
6. After the institution of the present complaint, the complainant adduced his pre summoning evidence U/s 200 Cr.P.C. on which basis the accused was summoned via order dated 20.04.2006 to face trial for the offence U/s 138 NI Act. After the service of the summons, the accused entered his appearance whereupon the provisions of sec. 207 Cr. P.C. were also complied.
7. The accused was admitted to bail then notice U/s 251 Cr. P.C. for the offence U/s 138 NI Act was served upon him on 09.05.2007 after hearing the contesting parties. Needless to say, the accused pleaded "Not Guilty" and claimed trial.
Trial
8. In order to substantiate his case, the complainant examined Sandeep as the witness as CW 1 whose contents are a mere repetition of what had already been discussed under the "Brief Facts" and hence are not repeated for the sake of brevity. CW1 duly cross examined by the accused.
9. All the incriminating circumstances, appearing in the evidence against the accused were put in order to unable him to offer his explanation.
10. In his explanation u/sec 313 Cr.P.C r/w sec 281 Cr.P.C, the CC No.2143/1/1 Page No.4/16 accused admitted the issuance of cheques in question but stated that except his signatures all the other particulars on the cheques were filled by the complainant himself. The accused admitted the business dealing with the complainant. Accused further stated that he had earlier given the cash payment to the complainant regarding the two cheques in question amounting to Rs.21,554 and 8,708/-. Accused further submits that he is innocent and falsely implicated in the present complaint case by way of misusing of cheques in question.
11. Accused did not lead any defence evidence in support of his defence despite giving opportunities. Accordingly, DE was closed whereupon the trial came to a conclusion and the contesting parties were duly heard.
Facts in Issue
12. In order to have the positive outcome in his favour, the complainant was required to show that the cheques were given by the accused towards discharge of his liabilities which was dishonoured via returning memo's whereafter the accused had also failed to comply with the requirements of the legal notice.
13. On the other hand, the accused was required to show his defence on the scale of preponderance of the probabilities that he is not liable to pay the amount involved in the present case to the complainant.
CC No.2143/1/1 Page No.5/16Legal Prepositions
14. The presumptions provided U/s 118 NI Act and 139 NI Act would come to the rescue of the complainant once the execution of the cheque in question is proved on record.
15. As per section 118 NI Act, it is to be presumed in favour of the complainant during the trial that the cheque in question was given against consideration by the accused and that the complainant was the holder of the said cheque in due course. Further as per Sec. 139 NI Act, it is to be presumed in favour of the complainant during the trial that the cheque in question was received by the complainant against a legally enforceable debt or liability (Refer :- "Rangappa Vs. Sri Mohan" SLP (Crl.) 407/06, Dated:- 07.05.2010).
16. It is well settled that both the aforesaid presumptions U/s 118 & 139 NI Act are rebuttable in nature and the onus to rebut the same squarely rests upon the accused.
17. The accused can rebut these presumptions not merely by examining his own witnesses but also through the cross examination of the complainant and his witnesses thereby bringing on record through the entire evidence available on record (inclusive of complainant's evidence and defence evidence, if any), that the complainant was a liar, that their was no existing liabilities between the parties and that the cheque in question was misused. It must be kept in mind that once evidence is brought on record from both sides, it CC No.2143/1/1 Page No.6/16 becomes an evidence of the case and court can draw inferences from the said entire evidence either in favour or against any of the parties. Evidence is a complainant's evidence and accused's evidence only for the purposes of identifying it, but once it is adduced in the case, it becomes the evidence of the case and then the same has to be read as a whole. The court can not read the evidence of the complainant only to the extent it favours the complainant and overlook the remaining evidence which supports the accused merely on the ground that it is the complainant's evidence. Similarly, from the evidence adduced by the accused, the court can draw inferences either in favour of the complainant or against the accused. The accused has a right to argue his case even on the basis of the cross examination of the complainant & his witnesses to show to the court that there existed no legally recoverable debt or liability between the parties. In order to rebut the legal presumption in question, it emerges that the accused need not require direct evidence to disprove the existence of consideration.
18. Preponderance of probabilities is the standard of proof upon the accused to rebut the above presumptions, which is not as high as that of the prosecution whereby the accused is only required to show the existence of a probable defence so as to rebut the above presumptions. If the accused succeeds in raising a probable defence by referring to his own evidence (if any) and from the evidence of the complainant, then the onus would shift on to the complainant, who then would have to show beyond reasonable doubt the existence of consideration/existence of a legally recoverable debt or liability in respect of the cheque in question.
CC No.2143/1/1 Page No.7/16Appreciation of Evidence
19. In his cross examination CW1 stated that he is the brother of the complainant and authorized to file the present case vide General Power of Attorney Ex.CW1/1. CW1 admitted that he used to participate in day to day working in the firm of the complainant and accused is known to him since 10-15 years. CW1 reiterated that accused and complainant are having business relationship from the last 10-15 years and the goods were delivered on credit as well as cash basis. CW1 admitted that the original bills on record were prepared by the complainant in his presence and the endorsement at mark X as ''paid'' and mark Y ''paid'' on bill Ex.CW1/2 and bill Ex.CW1/3 respectively were written by the accused. CW1 further admitted that Ex.CW1/1 and Ex.CW1/3 does not bears the signatures of the accused and the Ex.CW1/9 does not bears the year of the issuance and Ex.CW1/5 does not bears the mentioning of the date, month and year of the issuance. However, all the suggestions put to him by the accused were denied.
20. The defence set up by the accused through the cross-examination of the complainant as well through his statement u/sec 313 Cr.P.C r/w sec 281 Cr.P.C is that the cheques in question were taken by the complainant in blank for the supply of goods to him on credit and same were presented in bank for encashment without his permission to claim fictitious amount. Further defence of the accused is that the accused did not receive the goods from the complainant as alleged by him and he has already paid the amount in cash to the complainant towards the bill Ex.CW1/2 and Ex.CW1/3. It is further defence of the accused is CC No.2143/1/1 Page No.8/16 that the amount mentioned in Ex.CW1/4 is manipulated and the amount shown in bill Ex.CW1/5 and Ex.CW1/9 is yet to be settled with the complainant. It is further defence of the accused that the correction on the cheque Ex.CW1/10 were not made by him.
21. It is argued by the Ld. counsel for complainant that from evidence on record, the complainant has proved that cheques in question were signed by the accused which was dishonoured vide memo and despite the legal notice accused did not make the payment. It is argued that during the cross examination of complainant nothing material has come out and the complainant has been able to prove his case. It is further argued that accused has failed to discharge the burden upon him to rebutt the presumption in favour of the complainant under the Act.
22. Ld. Counsel for accused has argued that accused is having no legal liability towards the complainant. In the present case, the cheques in question were taken by the complainant in blank for the purpose of security only and there is no existing legal liability against the accused. The blank cheques given to the complainant cannot be enforced towards any liability because it does not fall under the defination of cheque. Ld. Counsel for accused argued that the mentioning of the ''paid'' at point X and point Y on bill Ex.CW1/2 and bill Ex.CW1/3 establishes that accused has already made the due payment towards the said bills and no amount is due for them. The cheque Ex.CW1/10 is having cutting on the amount in figure as well as words and it is material alteration so, the cheque in question is self void and cannot be considered for any legally CC No.2143/1/1 Page No.9/16 recoverable debt. It is further argued that the bills placed on record by the complainant are false and fabricated. Hence, there is no liability of the accused in the present case as alleged by the complainant and the complainant has misused the cheques in question with the malafide intent to harass the accused.
23. Now the question is whether the complainant proved his case, that whether the amount was legally enforceable debt. Offence under Section 138 of the Act is a technical offence and the complainant is only supposed to prove that the cheques issued by the accused was dishonoured, his statement that cheques were issued against liability or debt is sufficient proof of the debt or liability and the onus shifts to the accused to show the circumstances under which the cheques were issued and this could be proved by the accused only by way of cogent evidence.
24. Accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence/evidence on preponderance of probabilities to prove that cheques in question were not supported by consideration and that there was no debt or liability to be discharged by him. However, there is no need 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.
CC No.2143/1/1 Page No.10/1625. From the material on record it is established that complainant and accused are known to each other and are dealing in the business transaction. Accused admitted the issuance of the cheques in question as well as his signatures on the cheques in question. The service of statutory legal notice is not in dispute. Record reveals that cheque Ex.CW1/6 and Ex.CW1/7 were dishonored for the reason ''mutilated''. The reason of dishonour of cheque as mutilated is not sufficient to held the accused liable for the commission of offence under the ambit of provision of Section 138 of NI Act because the said cheques were not considered by the bank for the purpose of encashment. The said cheques are simply returned back to the complainant with the prima facie observation that cheques are torned and are not in the full form of cheques and are mutilated. However, the cheques Ex.CW1/10 and Ex.CW1/11 were dishonored for the reason ''insufficient funds''.
26. From the perusal of the record, it is revealed that accused had taken the defence on different dimenssions. One of his defence is that the cheques in question were taken by the complainant as a security for the supply of goods and the goods were not supplied to him. On the other hand, another defence is that the accused has already made the due payment towards the bills Ex.CW1/2 and Ex.CW1/3 and the cheque Ex.CW1/10 is material altered by putting correction to the amount of the cheque in figure as well as words.
27. It is pertinent to mention here that accused has not revealed an iota of evidence regarding the nature of the security as well as facts and circumstances under which the cheques in question were issued by him to the CC No.2143/1/1 Page No.11/16 complainant in blank. The due amount reflected in the bill Ex.CW1/2 and Ex.CW1/3 are exactly the amount as mentioned in the cheque Ex.CW1/6 and Ex.CW1/7. CW1 specifically stated in his cross examination that the endorsement at mark X and mark Y on bill Ex.CW1/2 and Ex.CW1/3 are in the handwriting of accused himself. But the accused had not lead any defence to show that the same were not written by him. Perusal of the bill Ex.CW1/2 and Ex.CW1/3 shows that the endorsement at point X and point Y are in different ink and different handwriting. There is every apprehension in the mind of ordinary prudent man when the amount shown on the bills and the amounts mentioned on the cheques are same then it might have been given for the payment of the said bill. The reason of the dishonor of cheques in question Ex.CW1/10 is due to the reason insufficient funds and not due to reason of difference of signatures of drawer or of any other reason. The accused has not led any handwriting expert evidence to prove his defence that the Ex.CW1/10 is material altered by the complainant or is misused by the complainant. Moreover, the accused also not placed on record any iota of evidence to prove that the bills furnished on record by the complainant are false and fabricated or that the outstanding due amount is yet to be settled between with the complainant. Hence, all the defences taken by the accused are contrary as well as inconsistent with each other and fatal to the foundation of the defence version.
28. It is not disputed that the accused has neither lodged any complaint/report against the complainant nor has filed any civil or criminal case against the complainant pertaining to the misuse of the cheques in question. It is very material fact and ought to have been brought to the knowledge of CC No.2143/1/1 Page No.12/16 appropriate authorities. It is pertinent to mention herein that in the present case the reason of dishonor of cheques Ex.CW1/10 and Ex.CW1/11 are due to funds insufficient. Further, no advance intimation, as expected from ordinary and prudent person, was given by the accused to his banker for stop payment against the misuse of the cheques in question by the complainant. Even otherwise, it may be seen that no complaint has been made to any authority against the alleged misuse of the cheques in question nor matter has been brought to the notice of the complainant at any point of time further weakens the reliability of the defence taken by the accused in the eyes of the prudent man. Therefore the plea as set up is only after thought and is having no factual basis.
29. However, in the present case accused has not produced any cogent proof in support of the defence version by way of leading defence evidence despite opportunities, which makes it improbable that the cheques in question were not issued towards the discharge of legal liability as alleged by the complainant but at the same time strengthens the foundation fabrics of the present complaint case. In the present case, the accused failed to raise a cogent suspicious circumstances in the version of the complainant which belies the foundation of the present complaint case that the cheques in question were not for discharging the legal liability. Further, nothing has been proved by the accused to show that he has given the cheques in question to the complainant as security as blank and that he did not have the legally enforceable liability towards the complainant.
CC No.2143/1/1 Page No.13/16Conclusion
30. Having considering the testimonies along with other documents on record, the issuance of cheques are not in dispute which were dishonored for the reason 'funds insufficient'. Accused is served with legal notice through registered post within the stipulated period and despite that no payment has been made by him.
31. Reading of the evidence on record in its entirety, would show that the evidence is not supportive with the innocence of the accused and as such same is liable to be dismissed out rightly. Secondly, accused has not produced any cogent proof in support of his defence on record. This court is of the opinion that the defence set up is neither definitive nor consistent with innocence of the accused. It is liability of the accused to bring positive evidence, in the wake of denying the liability by bringing evidence showing that accused has no liability to- wards complainant in the present complaint. It was sole burden and duty of the accused to prove no liability by raising probable defence when he was defending presumption, which was supporting the dishonoured cheques. The accused has failed to discharge the onus.
32. For rebutting the presumptions under the 'Act', a just need is to raise a probable defence. However, in the present case accused not only failed to show preponderance of probability in his favour but also not succeeded in dis- charging his initial burden for rebutting the presumption under the NI Act by not leading any cogent evidence in his support. Thus, this court unhesitatingly holds CC No.2143/1/1 Page No.14/16 that the accused has not been able to rebut the presumptions under section 139 and 118 NI Act standing in favour of complainant.
33. Having considered the entire evidence, complainant successfully proved all the essential requirements of Section 138 of the Act i.e. :
(a) The cheque for an amount is issued by the accused to
the complainant on a bank account maintained by
him.
(b) The said cheque is issued for the discharge, in whole
or in part of any debt or other liability by the ac-
cused.
(c) The cheque is returned by the bank unpaid on ac-
count of insufficient amount to honour the cheque.
(d) The cheque is presented to the bank within 6 months
from the date on which it is drawn and is within the pe-
riod of its validity.
(e) 30 days demand notice is issued by the complainant
on receipt of information by him from the bank regard-
ing the dishonour of the cheque.
(f) The drawer of said cheque / accused fails to make the
payment of the said amount of the money to the com-
plainant with in 15 days of the said notice.
(g) The debt or liability against which the cheque was is-
sued is legally enforceable.
CC No.2143/1/1 Page No.15/16
34. Accordingly, accused is guilty for committing the offence punishable u/s 138 of the Act qua the cheques Ex.CW1/10 and Ex.CW1/11 only, he is hereby convicted for the offence under section 138 of the Act. Let he be heard on point of sentence separately.
Announced in open court on SATVIR SINGH LAMBA
28th Day of August 2012 MM-01(NI ACT)WEST
DELHI
CC No.2143/1/1 Page No.16/16