Delhi District Court
12. In The Case Of Hiten P. Dayal vs Bratindranath on 23 May, 2023
IN THE COURT OF MS DIVYA ARORA, MM (NI ACT)-01,
SOUTH-WEST DISTRICT: NEW DELHI
CC No. 32813/2019
Under Section 138 of N.I. Act
In the matter of:
VISHAL AGGARWAL
S/o Shri Rajender Prasad Aggarwal
R/o E-647 Qutub Vihar, Phase II,
Near Ram Mandir,
Goyla Dairy,
New Delhi - 110 071. ... Complainant
Versus
DEEPAK SEHRAWAT
S/o Shri Satbir Singh Sehrawat @ Satte
R/o House no.203,
Near Holy Chowk,
Bakkarwala,
West Delhi,
Delhi - 110 041. ... Accused
Date of Institution : 31.08.2019
Date of Judgment : 23.05.2023
JUDGMENT
1. Briefly, the case of complainant is that accused used to run a business in the name of Vipul Tour & Travels at Shop no.109, 1st floor, Vardhman City Mall, Sector 23, Dwarka and complainant was already running a business in the name of Vishal Departmental Store at shop no.17 in Vardhman City and Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 15:59:43 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 1 of 16 Complaint Case no. 32813/19 accused developed good friendly relations with complainant. It is further alleged that in November 2017, accused approached the complainant and asked him to lend some money for his personal needs and due to friendly terms, complainant agreed to help him financially. It is further alleged that between November 2017 to July 2018, complainant lent a total sum of Rs.2,60,000/-, in cash from time to time which accused assured to repay within a period of six months. In January 2019, accused sought some more time to repay the amount as he was facing some financial crisis. It is further alleged that accused in discharge of his legal liability, issued cheques bearing no.763952 for Rs.50,000/-, 763953 for Rs 50000/-, 763954 for Rs 100000 and 763956 for Rs.60000/-, all dated 08.07.2019 and drawn on ING Vysya Bank Limited, Dwarka Branch (Ex.CW1/B1 to Ex.CW1/B4) (hereinafter referred to Cheques in question) and assured the complainant that the same would be honoured on their presentation. However, on presentation of the Cheques in question, the same were returned dishonoured vide return memos dated 10.07.2019 with the remarks ''Account Closed''.(Ex. CW1/C1 to Ex. CW1/C4) Upon this, the complainant sent a legal demand notice dated 07.08.2019 to the accused. On failure of accused to pay the cheques amount within the mandatory period of 15 days, the complainant has moved this court with a complaint under section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred as "NI Act"). Aadhar Card is Ex.CW1/A (OSR), Original Cheques are Ex.CW1/B1 to Ex.CW1/B4, Return memos are Ex.CW1/C1 to Ex.CW1/C4, Legal Notice is Ex.CW1/D1, Postal receipt is Ex.CW1/D2 and Delivery report is Divya Digitally signed by Divya Arora Date:
Arora 2023.05.23 Vishal Aggarwal v. Deepak Sehrawat Page no. 2 of 16 15:59:53 +0530 Complaint Case no. 32813/19 Ex.CW1/D3.
2. On finding of prima facie case against the accused, summons were issued against him and accused appeared before the court on 19.12.2019.
3. The notice under section 251 of the Code of Criminal Procedure ("Cr.P.C.") was framed against the accused vide order dated 25.12.2021 to which he pleaded not guilty. He deposed that, "The cheques in question bears my signatures. I did not fill the particulars on the Cheque in question. I did not receive any legal notice. I used to have regular business dealings with the complainant as complainant was running a grocery shop. I left my signed Cheque book with the complainant due to regular business dealings. I suffered loss in my business and closed my office. I asked for return of my signed cheques from the complainant but he refused to return the same and therefore, I closed my bank account. I do not owe any liability towards the complainant."
4. The complainant adopted his pre-summoning evidence tendered by way of affidavit as his post-summoning evidence.
5. After framing of notice, complainant was examined in chief as CW1 and was cross examined by ld counsel for accused at full length. Thereafter, CE was closed and the matter was listed for statement of accused under Section 313 CrPC.
Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 16:00:05 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 3 of 16 Complaint Case no. 32813/19
6. Statement of accused was recorded under Section 313 CrPC read with Section 281 Cr.P.C. on 05.08.2022 wherein all the incriminating circumstances appearing in evidence against the accused was put to him to which he stated that, "The cheques in question bears my signatures. I did not fill the particulars. I did not receive any legal notice. The address mentioned on the legal notice is not mine. Complainant and I was doing a transport business before 2014. I used to give my signed Cheque book to complainant for business transaction. Thereafter some dispute happened between me and complainant with regard to business. I ended all our business relations and asked for return of Cheque book. Complainant kept avoiding the return of Cheque book. Thereafter, I instructed my bank to close my account. Complainant has misused my Cheque book and filed the present case. When I approached complainant for return of Cheque book. I even entered into a fight with him and complaint was registered against me by complainant at PS Dwarka Sector 23 in 2014. I do not owe any liability towards him."
7. Accused led evidence in his defence and examined himself as DW1 and Shri Manjeet as DW2. They were cross examined by Ld. Counsel for complainant. Thereafter, the matter was fixed for final arguments.
8. Thereafter, the Ld. Counsel for complainant and the accused were heard at length in the present case and the matter was reserved for Judgment.
9. Before proceeding to the merits of the case, it is Digitally signed Divya by Divya Arora Date: Arora 2023.05.23 16:00:20 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 4 of 16 Complaint Case no. 32813/19 important to lay down the basic provision of law with respect to Section 138 NI Act which is as follows:- Section 138 of Negotiable Instruments Act, 1881 makes dishonour of cheques an offence. It provides that ''where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which extend to twice the amount of the cheque, or with both''.
10. In order to ascertain whether the accused has committed on offence u/s 138 NI Act, the following ingredients constituting the offence have to be proved:-
(a) The drawer of the cheque should have issued the cheque for the discharge, in whole or in part of a legally enforceable debt or other liability.
(b) The cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 Vishal Aggarwal v. Deepak Sehrawat Page no. 5 of 16 16:00:33 +0530 Complaint Case no. 32813/19 cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank.
(c) The drawer of such cheque fails to make the payment of the said amount of money within fifteen days of the receipt of the notice from the payee or the holder in due course demanding the payment of the said amount of money.
It is only when all the above mentioned ingredients are satisfied that the person who has drawn the cheque can be set to have committed an offence u/s 138 NI Act.
11. It is important to recall Section 118 of the Indian Evidence Act 1872 and Section 139 of the N.I Act here. Section 118 (a) of the Act provides that until the contrary is proved, it shall be presumed that ''that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration''. Further, Section 139 of the Act lays down that ''it shall be presumed, unless the contrary is provided, 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."
12. In the case of Hiten P. Dayal Vs Bratindranath Bannerjee (2001) G SCC 16, the Hon'ble Supreme Court of India had observed that ''Because both sections 138 and 139 Divya Digitally signed by Divya Arora Vishal Aggarwal v. Deepak Sehrawat Arora Page no. 6 of 16 Date: 2023.05.23 16:00:46 +0530 Complaint Case no. 32813/19 CrPC required that the court shall presume the liability of the drawer of the cheque for the amount for which the cheques are drawn as noted in State of Madras Vs A. Vaidhyanatha Iyer AIR 1958 SC 61, it is obligatory on the court that raise this presumption in every case where the factual basis for raising of the presumption has been established. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused''.
13. The core issue that arises for consideration whether the cheques in question were issued by the accused in discharge of his liability.
14. The accused has admitted his signatures on the cheques in question at the stage of notice framed u/s 251, Cr.P.C. and examination u/s 313, Cr.P.C. Thus, unless the contrary is proved, it shall be presumed that the complainant received the cheques in discharge of the debt/ liability from the accused. The standard of proof for rebuttal is on preponderance of probabilities. As held by the Hon'ble Supreme Court in decision cited as K.N. Beena vs Muniyappan And Another; (2001) 8 SCC 458, in order to rebut the presumption, mere denial by the accused will not suffice. The accused must prove by leading cogent evidence that there was no debt/ liability.
15. Major defence led by accused is that Cheques in question were given to complainant to pay salaries to drivers and for other business purposes, as complainant used to manage the payments of accused in his absence. In the present case, the onus Digitally signed by Divya Divya Date:
Arora Vishal Aggarwal v. Deepak Sehrawat PageArora no. 716:01:00 of 16 2023.05.23 +0530 Complaint Case no. 32813/19 to prove that accused has not issued the cheques in question in favour of the complainant to discharge any liability, primarily lied on the accused. Section 103 of the Indian Evidence Act, 1872 enunciates that the person who asserts a fact must prove the same unless the law otherwise provides.
16. To prove his defence, accused examined himself as DW1 and Mandeep as DW2. Accused has stated in his evidence that he and complainant developed good relations as both of them were running their business in the same building. Accused has also engaged two of complainant's cars in his tour and travel business. Since accused used to travel for business purposes, the cheques in question were given to complainant for payment of salaries to drivers or any other expenditure. He further stated that he was facing loss in his business in 2013-2014 and that's why had to close down the business. Later, when complainant failed to return those signed cheques, he had to get his account closed in 2014. Accused even went to complainant's house along with his brother in law i.e. DW2 to get the cheques back, there they had a fight with complainant and his wife and then the matter was settled at police station.
17. Ld. Counsel for complainant argued that no demand notice was ever sent by accused with regard to return of cheques in question from 2014 to 2019. He further argued that there is no documentary proof to prove the settlement arrived at any police station. He has also pointed out inconsistency in the defence of accused. In his application u/s 145(2), accused has stated that business was closed in 2015-2016, however, in his evidence. he Digitally signed Divya by Divya Arora Date: 2023.05.23 Arora 16:01:12 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 8 of 16 Complaint Case no. 32813/19 has stated that business was closed in 2013-2014.
18. Perusal of material on record reveals that accused has filed no cogent evidence in support of his testimony. The only witness examined by him is DW2, whose testimony cannot be relied upon as he is brother in law of accused person and appears to be an interested witness. Despite that, testimony of DW2 is not sufficient to discharge the initial burden of proof resting upon accused. The testimonies of DW1 and DW2 are inconsistent. Testimony of DW2 elucidates that complainant joined the business of accused, however, accused's testimony no where elucidates that complainant joined his business except renting out of his two cars. Therefore, the testimony of DW2 cannot be relied upon. There is no clear defence of the accused; whether complainant has joined his business or was just managing the payment in his absence. With regard to fight at complainant's house, there is no evidence in support of the testimonies of DW1 and DW2. Infact, accused has failed to give the exact details of PS, where they went for settlement. There is no cogent evidence to prove any of the defence of accused.
19. Further, accused has failed to explain why no legal action was ever taken by him from the date of closing of his business till presentment of cheques in question. Accused should have examined or got summoned any of his driver, who would have stated that they used to collect payment through cheques from complainant, in the absence of accused. Accused should have filed his bank statement on record to prove the payment of salaries to drivers through cheques in 2013-2014. In the present Digitally signed by Divya Divya Arora Date:
Arora 2023.05.23 16:01:23 Vishal Aggarwal v. Deepak Sehrawat Page no. 9 of 16 +0530 Complaint Case no. 32813/19 case, accused has failed to file any cogent evidence to discharge the initial burden of proof resting upon him, even on the scale of preponderance of probabilities.
20. It has been held by Hon'ble Apex court in Basalingappa v Mudibasappa (2019) 5 SCC 418 ,that:
"To rebut the presumption, it is open for the accused to rely on evidence led by him or he 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. Further, 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."
21. Ld. Counsel for accused argued that Complainant has neither given the exact date of advancement of loan nor filed any bank statement or ITR to prove the loan advancement. He further argued that no reasonable person will give four cheques of same date to repay the loan.
22. It is correct that the complainant has not given any exact date of loan advancement and failed to complain why four cheques of same date were taken, however, these facts in itself are not sufficient to rebut the statutory presumption raised in Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 16:01:34 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 10 of 16 Complaint Case no. 32813/19 favour of complainant. Further, no questions were ever asked with regard to production of bank statements or ITR, during the cross examination of complainant. Complainant has to explain his financial capacity and source of loan when the doubts or questions are raised regarding it. In the entire cross examination of complainant, accused has not challenged the financial capacity or asked for bank statements or ITR. Non disclosure of such details, if not asked, is not sufficient to discredit the entire case of complainant and to rebut the statutory presumption in favour of complainant when nothing has been brought on record by the accused for rebuttal even on the basis of preponderance of probabilities.
23. The circumstantial evidence has to be seen from the point of a reasonable/prudent man. Hence, when the business was closed ; why did the accused not take any legal action for getting the cheques in question back, or in the least, issue a written notice to the complainant to return the said cheques. In view of above, the contention of the accused qua misuse of cheques, in absence of legal action/communication seeking return of the cheques; and in light of the lack of evidence in the stance of the accused as to the the exact purpose for which cheques in question were given to complainant; the defence of the accused is only by way of mere/bare denial and does not inspire confidence from the stand point of a reasonable/prudent man.
24. Additionally, the accused has averred that he has not filled the particulars on the cheque in question. In Oriental Bank of Commerce V. Prabodh Kumar Tewari Crl. Appeal no.1260 of Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 16:04:01 Vishal Aggarwal v. Deepak Sehrawat Page no. 11 of 16 +0530 Complaint Case no. 32813/19 2022 it has been held by Hon'ble Supreme Court of India that, "For such a determination, the fact that the details of the Cheque have been filled up not by the drawer, but by some other person would be immaterial. The presumption which arises on the signing of the Cheque cannot be rebutted merely by the report of a hand-writing expert. Even if the details in the Cheque have not been filled by drawer but by another person, this is not relevant to the defence whether Cheque was issued towards payment of a debt or in discharge of a liability."
25. Even if for the sake for the arguments, it is believed that cheques in question were blank but the fact that the Cheques were in possession of the complainant with no plausible explanation coming from accused to show as to how it ended up with the complainant does not dilute the liability of the accused as the legal position on inchoate instruments is well settled. Further, inaction on the part of accused to take steps for stopping misuse or wrong encashment of his cheques by complainant suggests that he never took steps to procure back his alleged blank signed cheque. Section 20 of the NI Act provides that if a person signs and delivers a paper stamped in accordance with the loan and either wholly blank or have written thereon an incomplete negotiable instrument, such person thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp.
26. Therefore, considering the weight of the attending Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 16:01:45 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 12 of 16 Complaint Case no. 32813/19 circumstances viz, the consistency in the prosecution story, and the failure of the accused to put forth any reasonable and believable defence and fact that the accused has not proved his defence to cause the probabilities to lie in his favour, an element of section 138 NI Act stands assembled.
27. Another condition with regard to Section 138 NI Act is receiving of legal notice. Accused has denied to the receiving of legal notice at the stage of notice framed under Section 251 CrPC, and statement recorded u/s 313 CrPC. Ld. Counsel for accused argued that the address mentioned on the legal notice is incorrect and that is why accused never received the summons. To prove his defence, accused got concerned delivery official summoned as DW3 by filing an application u/s 311 CrPC. However, DW3 did not bring any relevant record with regard to speed post in question as it was already weeded out, being time barred. Ld counsel for accused has relied upon R.L. Verma and sons v P. C. Sharma ( Crl. Rev. P. 438/2017) by Hon'ble Delhi High Court and Engineering Control Vs. Banday Infratech Pvt. Ltd. Cr. MC. 381/2018 by J& K High court, wherein it has been held that if the legal notice is not served then accused must be acquitted.
28. Perusal of material on record reveals that address mentioned on legal notice is exactly the same address given by accused at the time of notice framed u/s 251 CrPC. Further, accused appeared before this court upon issuance of summons and bailable warrants at the address mentioned in the legal notice. Accused has filed no documentary evidence to prove that Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 16:02:00 Vishal Aggarwal v. Deepak Sehrawat Page no. 13 of 16 +0530 Complaint Case no. 32813/19 the address mentioned on legal notice is not his address.
29. This court is of the view that the address on the legal notice once having been shown to be the correct address of accused and legal notice having been dispatched by registered AD, a presumption of due service arises in view of Section 27 of General Clause Act & Section 114 of Indian Evidence Act and now it is upon accused to prove that notice was not served upon him. No cogent evidence has been brought on record by the accused to displace the presumption of due service.
30. Also in CC Alavi Haji Vs. Palapatti Mohammad (Crl.)767/2007 the Hon'ble Supreme Court of India held that, "where the notice is sent by Registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of clause (b) of proviso to section 138 Act stands complied with." Further, the above judgment also stated that any drawer who claims that he did not receive the notice sent by post, can within 15 days of receipt of summons from the court in respect of the complaint u/s 138 NI Act make payment of the cheque amount and submit to the court that he had made payment within 15 days of receipt of summons. In the present case, the accused has failed to adduce any evidence to rebut the presumption of due service. As such, the legal notice stood served upon the accused.
31. Another condition qua the presentation of the cheque within three months is concerned, the same is satisfied upon the perusal of the cheques in question (Ex CW1/B1, Ex.CW1/B2, Digitally signed by Divya Divya Date:
Arora Arora 2023.05.23 Vishal Aggarwal v. Deepak Sehrawat Page no. 14+0530 of 16 16:02:13 Complaint Case no. 32813/19 Ex.CW1/B3 and Ex.CW1/B4) dated 08.07.2019 while the return memos (Ex.CW1/C1, Ex.CW1/C2, Ex.CW1/C3 and Ex.CW1/4) dated 10.07.2019, thus, being presented within the prescribed period of limitation of three months. The defence did not adduce any evidence whatsoever to contradict the same.
32. Another condition pertains to the cheque being returned unpaid owing to their being dishonored. Bank return memo or slip is prima facie proof of dishonor. Section 146 of the Negotiable Instruments Act, 1881, in this regard comes into play which raises a presumption that the court shall presume the fact of dishonor of the cheque in case of cheque is returned vide a return memo issued by the bank having thereon the official mark denoting that the cheque has been dishonored. Again, as the defence has failed to rebut the said presumption, hence the said condition is also satisfied.
33. The last condition is that accused fails to make the payment within fifteen days from the date of the receipt of the legal demand notice. In the present case, the accused has evidently failed to make the payment within the fifteen days contending that he owes no legal liability to pay the amount mentioned in the cheque in question. The accused has miserably failed to prove that said assertion and thus, the last limb of what will entail the liability against the accused, is also structured.
34. In view of the forgoing discussion, the accused has miserably failed in probabilising his defence, even on the scale of Digitally preponderance of probabilities.
signed by Divya Divya Date:
Arora Arora 2023.05.23 16:02:22 +0530 Vishal Aggarwal v. Deepak Sehrawat Page no. 15 of 16 Complaint Case no. 32813/19
35. The complainant has with the aid of evidence led a presumption of legal liability under Section 118 read with Section 139 of N. I. Act and has successfully proved the basic ingredients of offence under section 138 N. I Act.
36. Resultantly, the accused Deepak Sehrawat stands convicted for the offence under Section 138 NI Act. Let the convict be heard separately on the quantum of sentence.
37. Let a signed copy of the Judgment be supplied to the accused, free of cost, and a copy of the same be placed on record.
Digitally
signed by
Divya Divya Arora
Date:
Arora 2023.05.23
Decided on 23.05.2023 16:02:44
+0530
Announced in open court. (DIVYA ARORA)
MM (NI Act)-01/SW/DWK
New Delhi
Vishal Aggarwal v. Deepak Sehrawat Page no. 16 of 16
Complaint Case no. 32813/19