Delhi District Court
Sudesh Chabra vs K.S Rajesh on 14 March, 2024
IN THE COURT OF SH. VARUN CHANDRA, METROPOLITAN
MAGISTRATE (SOUTH) NI ACT, SAKET COURTS,
NEW DELHI
CT Cases 15073/2018
SUDESH CHABRA Vs. K.S RAJESH
Sudesh Chabra,
W/o Late Sh. Raj Kumar,
R/o H.No. 18/305, Dakshinpuri Extension,
New Delhi
......... Complainant
Vs.
K.S. Rajesh,
S/o Sh. V.N. Krishna Swamy,
R/o A-25/2, Krishna Park, Devli,
New Delhi-110062
......... Accused
1. Complainant : 15073
Case Number
DLST020313952018
2. Offence : Under Section 138 of the
complained Negotiable Instruments Act, 1881
proved
3. Plea of the : Pleaded not guilty
accused
4. Final Order : Acquitted
5. Date of : 09.10.2018
Institution
6. Date on which : 15.12.2023
reserved for
Judgment
CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 1/13
COMPLAINT UNDER SECTION 138 NEGOTIABLE
INSTRUMENTS ACT, 1881.
JUDGMENT
1. It is the case of the complainant that the accused and the complainant were having friendly relations with each other.
2. That while taking undue advantage of the long acquaintance with the complainant, the accused approached the complainant for loan on the pretext of some dire need and offered to mortgage documents of his property bearing no. C-279, Dakshin, Delhi in favour of complainant, accordingly, on accused inducement, complainant paid a sum of Rs. 3,00,000/- to accused on 18.03.2013. Accused executed document dated 18.03.2013 and admitted the receipt of Rs. 3,00,000/- and mortgaged documents of his property bearing no. C-279, Dakshin, Delhi in favour of the complainant and further handed over the original title documents of the said property to the complainant, vide document dated 18.03.2013, accused agreed to pay interest @3% p.a. to the complainant up to the date of final payment of principal amount.
3. It is the case of the complainant that after lot of persuasions by the complainant, the accused in discharge of the aforesaid liability in part, the accused issued the cheque bearing no. 079212 dated 30.07.2018 for an amount of Rs. 2,20,000/- drawn on State Bank of India, Ambedkar Nagar, Dakshin Puri Branch, New Delhi in favor of the complainant and the same was dishonored and returned by the banker of the accused on their presentation with remarks "Funds insufficient" vide return Memo dated CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 2/13 07.08.2018.
4. That immediately after the receipt of the said information from the bank, the complainant duly informed the accused about the said dishonour. However, till date the complainant has not received any payment in lieu of the said cheque.
5. That thereafter the complainant sent a Legal Notice dated 24.08.2018 through Speed Post. and was duly served upon the accused. That the said legal notice was duly received on 27.08.2018 by the accused but neither any payment nor any reply has been given till date against which present complaint has been preferred.
6. In order to prove his case, the complainant had examined himself as CW-1 by way of affidavit CW-1/A and relied upon the following documents:
Ex.CW-1/1 Agreement dated 18.03.2018
Ex.CW-1/2 Cheque bearing No. 079212 dated 30.07.2018 for Rs.
2,20,000/-
Ex.CW-1/3 Return Memo dated 07.08.2018
Ex.CW-1/4 Legal Demand notice dated 24.08.2018
Ex.CW-1/5 Postal receipts
Ex.CW-1/6 Tracking report
Ex.CW-1/A Evidence by way of affidavit
7. After perusal of the complete complaint and the affidavit of evidence, sufficient material was found and summoning orders were passed against the accused under Section 204 Cr.PC Vide order dated 09.10.2018 by the Ld. Predecessor of the Court.
CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 3/13
8. Vide order dated 19.01.2019, the accused had appeared. Upon the request of both the parties, the matter was referred to the Mediation Center. Vide Mediation order dated 02.02.2019, the matter was settled for Rs. 1,45,000/- .
9. The accused in lieu of the settlement agreement had issued the cheques as recorded VOD 16.03.2019 which subsequently could not be cleared as the same was as an outdated cheque. The accused again issued a cheque as recorded VOD 19.10.2019 for an amount of Rs. 20,000/-. Upon subsequent non appearance, coercive steps taken and process u/s 82 Cr.PC was issued against the accused. However, upon subsequent appearance, the proceedings were not completed against him. The notice was served to the accused VOD 07.03.2022 and the application u/s 145(2) NI Act was duly allowed by the Ld. Predecessor as recorded VOD 30.04.2022. The matter was put up for cross examination; the complainant was examined, cross examined and discharged VOD 27.06.2022, CW-2 was examined, cross examined and discharged VOD 08.08.2022 and the CE was closed.
10. The statement of accused u/s 313 Cr.PC was recorded VOD 23.09.2022 wherein the accused accepted the loan from the complainant for an amount of Rs. 3 Lakh, however denied the issuance of cheque for the stated amount of Rs. 2,20,000/- stating that the cheque was given blank. The accused further stated that he had paid a sum of Rs. 1,50,000/- and Rs. 75,000/- in cash. Accused further stated that an amount of Rs. 50,000/- & Rs. 65,000/- were paid by him in Court. The accused was then examined as DW-1, cross examined and discharged VOD 22.06.2022 and DE was subsequently closed VOD 31.07.2023. Final arguments were heard in the present matter VOD 25.11.2023 & 15.12.2023; the matter was put up for CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 4/13 Judgment VOD 02.02.2024.
ARGUMENTS ADVANCED
11. Counsel for complainant argues that a friendly loan of Rs. 3 Lakhs was advanced by the complainant in the present matter and as a guarantee, the accused had mortgaged his property. He further argues that the cheque in question for an amount of Rs. 2,20,000/- which was presented by the complainant and was subsequently got dishonored.
12. Counsel for complainant argues that all the ingredients of the offence u/s 138 NI Act has been fulfilled as the account is maintained by the accused; the legal debt was accepted by the accused; the cheque was returned unpaid; and the legal demand notice was duly sent through a registered post; and upon receiving of which no payment was made by the accused.
13. Counsel for complainant argues that the matter was settled between the parties for an amount of Rs. 1,45,000/- and some amount was paid by the accused as well. He further argues that due to non-payment, the matter was taken up on merits.
14. Counsel for complainant argues that the accused has failed to rebut the presumptions available in favour of the complainant u/s 139 NI Act as the cheque has been duly admitted by the accused. He relies on the Judgment of Bir Singh v. Mukesh Kumar Criminal Appeal Nos. 230-231 OF 2019 & "Triyambak S Hegde v Sripad" (2022) 1 SCC 742.
15. Per contra, LAC for accused argues that a loan of Rs. 3 Lakh was given @ 3% per month as alleged by the complainant in the year CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 5/13 18.03.2013, however, the cheque of Rs. 2,20,000/- was presented after a period of five years i.e. 30.07.2018.
16. LAC for accused submits that the matter was settled through the Mediation Center for an amount of Rs. 1,45,000/-. he further argues that payment was made on 20.04.2019 & 01.07.2019 by the accused.
17. LAC for accused argues that the property of the accused taken as mortgaged for the loan advanced by the complainant was done under an Agreement with the accused which was not signed by the complainant himself. He argues that the complainant was silent for a period of 5 years and was accepting the rate of interest 3%. He argues that the loan was given in 2013 and the cheque in question was given to the complainant at the time of loan advanced. However, the complainant in his complaint has mentioned the cheque for the year 2018.
18. LAC for accused argues that the signature of CW-2 were taken on the Agreement at a later stage. He further argues that CW-2 deposed that the accused had deposited his property paper against the loan as well. He further argues that the complainant has denied receiving any money in Court which is a lie as reflected VOD 20.04.2019 and 01.07.2019. LAC for accused emphasises on the fact that the complainant was silent for the period of five years. He thereby prays that the accused be acquitted in the present matter.
19. It is pertinent to mention that to establish the offence under Section 138 of the NI Act against the accused, the complainant must prove the following ingredients reiterated in the Judgment of Hon'ble Supreme Court of India in Kusum Ingots and Alloys v. Pennar Peterson Securities Ltd.
CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 6/13 AIR 2000 SC954:-
(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability;
(ii) that cheque has been presented to the bank within a period of three months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iii) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(iv) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(v) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice;
20. Now there are presumptions available to the complainant under the Negotiable Instruments Act, 1881 in his favor which enunciates the presence of legal liability against the accused; as the language of the provision u/s 139 NI Act states that the presumption would be available to CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 7/13 the holder of a cheque given that the signatures on the cheque are admitted by the accused.
21. The Honorable Supreme Court of India in the case of Bir Singh v. Mukesh Kumar Criminal Appeal Nos. 230-231 OF 2019 held that :
"21. Section 139 of Negotiable Instruments Act, which mandates that unless the contrary is proved, it is to be presumed 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. Needless to mention that the presumption contemplated under Section 139 of the Negotiable Instruments Act, is a rebuttable presumption. However, the onus of proving that the cheque was not in discharge of any debt or other liability is on the accused drawer of the cheque."
and;
"23. Section 139 introduces an exception to the general rule as to the burden of proof and shifts the onus on the accused. The presumption under Section 139 of the Negotiable Instruments Act is a presumption of law, as distinguished from presumption of facts. Presumptions are rules of evidence and do not conflict with the presumption of innocence, which requires the prosecution to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law and presumptions of fact unless the accused adduces evidence showing the reasonable possibility of the non- existence of the presumed fact."
22. The Honorable Supreme Court of India in "Triyambak S Hegde v Sripad" (2022) 1 SCC 742 while relying upon the the constitution bench judgment of Basalingappa v Mudibasappa (2019) 5 SCC 418 , under para CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 8/13 14 of its judgment reiterated that once the cheque was issued and that the signatures are upon the cheque are accepted by the accused, the presumptions under section 118(a) and section 139 of the NI Act arise against the accused. That is, unless the contrary is proved, it shall be presumed that the cheques in question were drawn by the accused for a consideration and that the complainant had received the cheque in question in discharge of debt/liability from the accused.:
"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 the 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.
25.4. That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.
23. Further, The Honorable Supreme Court of India in "Rakesh Jain v. Ajay Singh" Crl. No. 12802 of 2022 has held under para 44 that:
"44. The accused may adduce direct evidence to prove that the instrument was not issued in discharge of a debt/liability and, if he adduces acceptable evidence, the CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 9/13 burden again shifts to the complainant. At the same time, the accused may also rely upon circumstantial evidence and, if the circumstances so relied upon are compelling the burden may likewise shift to the complainant. It is open for him to also rely upon presumptions of fact, for instance those mentioned in Section 114 and other sections of the Evidence Act. The burden of proof may shift by presumptions of law or fact. In Kundanlal's case- (supra) when the creditor had failed to produce his account books, this Court raised a presumption of fact under Section 114, that the evidence, if produced would have shown the non- existence of consideration. Though, in that case, this Court was dealing with the presumptive clause in Section 118 NI Act, since the nature of the presumptive clauses in Section 118 and 139 is the same, the analogy can be extended and applied in the context of Section 139 as well."
And further held under para 56 that;
"56. At the stage when the courts concluded that the signature had been admitted, the Court ought to have inquired into 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'?"
24. The defense raised by the accused against the presumptions available in the favor of the complainant will now be looked into and decided upon.
25. LAC for the accused has argued that the complainant did not present the cheque for a period of 5 years and collected the interest therewith. He has further argued that the accused has been paying amount to the complainant and some amount was paid during the course of the CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 10/13 proceedings as well, which has been denied by the complainant in its entirety.
26. The accused had made a payment of the Rs. 35,000/- as recorded VOD 01.0.2019 and Rs. 20,000/- as recorded VOD 19.10.2019 to the complainant against the settlement agreement reached between the parties vide mediation order dated 02.02.2019 for an amount of Rs. 1,45,000/-. The complainant had refuted against said payments at the time of his cross- examination. Further, It is difficult to understand that when the payment due by the accused was of Rs. 2,20,000/- and the case was instituted in the year 2018, the complainant settled the matter for an amount of Rs, 1,45,000/- with the accused in the year 2019.
27. The accused had stated that at the time of taking the loan, he had given blank security cheques to the complainant. The fact of cheque being given at the time of grant of loan had been accepted by the complainant in his cross-examination wherein he had stated that the mortgaged property paper and 3-4 cheques were given by the accused against the loan advanced in the year 2013. The fact that the complainant chose to initiate action against the accused after a period of 5 years raises some doubt on his claim that the cheques were issued after him requesting for payment several times as stated in his complaint. The complainant has raised different facts against what has been stated in the complaint. The fact that cheques were given in the year 2013 itself sufficiently proves the fact that the details were filled in by the complainant at a later stage as the cheque in question is dated 30.07.2018.
CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 11/13
28. This raises questions against the amount mentioned on the cheque in question at the time of presentation of the cheque. The Honorable Supreme Court of India in the judgment of Dashrathbhai Trikambhai Patel v. Hitesh Mahendrabhai Patel AIR 2022 SC 4961 had held that:
"Under Section 56 read with Section 15 of the Act, an endorsement may be made by recording the part-payment of the debt in the cheque or in a note appended to the cheque. When such an endorsement is made, the instrument could still be used to negotiate the balance amount. If the endorsed cheque when presented for encashment of the balance amount is dishonored, then the drawee can take recourse to the provisions of Section
138. Thus, when a part- payment of the debt is made after the cheque was drawn but before the cheque is encashed, such payment must be endorsed on the cheque under Section 56 of the Act. The cheque cannot be presented for encashment without recording the part payment. If the unendorsed cheque is dishonored on presentation, the offence under Section 138 would not be attracted since the cheque does not represent a legally enforceable debt at the time of encashment."
29. Thus, the accused has successfully raised doubts against the claim of the complainant and has rebutted the presumptions against him available to the complainant. Now, whether the complainant has fulfilled the ingredients of the offence under Section 138 Negotiable Instruments Act, 1882 would be examined and decided upon.
30. The complainant has presented a cheque in the year 2018 where the loan was granted in the year 2013. Without the presence of any proof of part payment or any written acknowledgement furnished on behalf of the accused, the computation of the limitation period for the debt to remain a legally recoverable debt under the provisions of the Negotiable Instruments Act, 1881 would be considered from the mortgage paper which is dated as 18.03.2013 vide Ex. CW1/1. The period of limitation available to the CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 12/13 complainant since the stated date is that of three years according to Article 19, Schedule I Part II of the Limitation Act, 1963. Given the fact that the complainant filled the date of the cheque himself and no date of repayment had been mentioned, thus, the given loan becomes time barred debt at the time of presentation of the cheque. Thus, the complainant has not been able to fulfill the very first ingredient of the offence under Section 138 Negotiable Instruments Act, 1882, that is, the cheque was issued to discharge a legally enforceable debt or liability.
31. In view of the above findings and analysis, it is concluded that the accused has successfully rebutted the mandatory presumptions under section 118 and 139 of the NI Act and the ingredients of offence under Section 138 Negotiable Instruments Act has not been fulfilled by the complainant.
32. Consequently, the accused K.S. Rajesh is held not guilty and is hereby acquitted of the offence under section 138 of the Negotiable Instruments Act, 1881.
Certified that this Judgment contains 13 pages and each page bears my signature.
Digitally signed by VARUN CHANDRA VARUN Date:
CHANDRA 2024.03.14
14:24:01
+0530
Pronounced in open Court (VARUN CHANDRA)
on 14.03.2024 MM-04/NI Act/Saket Courts,
South/New Delhi
CT Cases 15073/2018 SUDESH CHABRA Vs. K.S RAJESH PAGE NO. 13/13