Delhi District Court
M/S Bhawna Apparels vs . Neeraj Verma on 6 September, 2018
IN THE COURT OF MS NIHARIKA KUMAR : METROPOLITAN
MAGISTRATE - 04 : SOUTH : SAKET COURT : NEW DELHI
M/S BHAWNA APPARELS Vs. NEERAJ VERMA
CC NO. 472573/2016
Digitally
signed by
U/s 138 Negotiable Instruments Act NIHARIKA
NIHARIKA KUMAR
KUMAR Date:
2018.09.10
JUDGMENT 13:21:49
+0530
(1) Serial number of the case : 472573/2016
(2) Name of the complainant : M/s Bhawna Apparels.
Through its partner
Mr. Rajeev Manaktala,
Situated at:-
AB-853, Sarojini Nagar,
New Delhi-110023.
(3) Name of the accused, : Mr. Neeraj Verma,
parentage & address C/o Mr. Praveen Arora,
S/o Late Mr. Tarachand Arora,
R/o Block A/1, Gali No.15,
H. No.124, Bengali Colony,
Burari, Delhi.
Also at:
C/o Mrs. Bala Rani Verma,
W/o Mr. Neeraj Verma,
R/o 82A, Pocket R,
Dilshad Garden, Delhi.
Also at:
C/o Mr. Bharat Lal Verma,
R/o 79A, Jain Building,
Near Post Office,
Dilshad Garden, Delhi.
(4) Offence complained of or proved : 138 Negotiable Instruments
Act, 1881
(5) Plea of the accused : Pleaded not guilty
M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 1 of 10
(6) Final Order : CONVICTED
(7) Date of Institution : 16.08.2016
(8) Date on which reserved for
judgment : 09.08.2018
(9) Date of Judgment : 06.09.2018
BRIEF STATEMENT OF THE REASONS FOR THE DECISION
1.The brief facts of this case as carved out from the complaint are that the complainant is a partnership firm deals in the business of fabrics and garments for export and ready-made qualities under the name and style of M/s Bhawna Apparels. That accused also deals in the business of fabrication of garments, fabrics and garments of export and ready-made quality. That the complainant and the accused were doing the business with each other since long time. That in the month of April, 2016, accused approached complainant through its partner to purchase few garments on credit basis, complainant being known to accused, agreed to give the garments on credit basis. That the complainant provided the garments as demanded by the accused and raised the retail invoice bearing no. 10 dated 24.04.2016 for Rs. 40,950/-. That against the said bill, the accused handed over a post dated cheque bearing no. 470034 dated 09.06.2016 drawn on Punjab National Bank, Dilshad Garden, Delhi for Rs. 40,950/- (hereinafter 'the cheque in question') in favour of the complainant with assurance that the same shall be encashed on its presentation. Complainant deposited the said cheque on its M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 2 of 10 date with its bank i.e. Allahabad Bank, H12, Green Park Extn., (GPE), New Delhi and the same was returned unpaid/ dishonored vide returning memo dated 10.06.2016 with the remarks "Fund Insufficient". That a legal demand notice dated 29/06/2016 for the payment of amount of dishonored cheque was sent by the complainant through his counsel to the accused through registered AD and speed post, despite receipt of which, payment of the cheque in question was not made by the accused. Hence, the complainant filed the instant complaint under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter "the Act").
2. The pre-summoning evidence, by way of affidavit of Sh. Rajev Manaktala, Partner of Complainant (Ex. CW-1/1) was filed. In his affidavit of evidence Ex. CW-1/11, he reiterated all the averments made in his complaint and relied on documents Ex. CW-1/A to Ex. CW-1/H, which are original authority letter (Ex.CW-1/A), carbon copy of retail invoice dated 24.04.2016 (Ex.CW-1/B), original cheuqe in question (Ex.CW-1/C), its returning memo (Ex.CW-1/D), office copy of legal notice (Ex.CW-1/E), postal receipts (Ex.CW- 1/F Colly), tracking reports (Ex.CW-1/G Colly), and computerized copy of statement of account maintained by the complainant firm (Ex.CW-1/H).
After perusal of the complaint and affidavit of evidence, since sufficient material was found against the accused, summoning order u/s 204 CrPC was passed against the accused vide order dated 16/08/2016 by my Ld. Predecessor Judge.
M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 3 of 10
3. Accused appeared pursuant to issuance of summons. Thereafter, notice U/s 251 Cr.P.C. was served upon the accused vide order dated 22/04/2017 to which the accused pleaded not guilty and claimed trial.
The accuses stated in his defence that the cheque in question was given as security for the transaction with the complainant and all the contents on the cheque in question are in his handwriting. Accused further stated that, he had received the legal notice of demand and he did not reply the same and he has legal liability to pay the cheques amount to the complainant.
4. Since the accused admitted his liability for the cheque amount in question, therefore, matter was fixed for recording statement of accused u/s 313 r/w 281 CrPC.
5. Thereafter, the statement of the accused u/s 313 r/w 281 CrPC was recorded vide order dated 28.08.2017. All material existing on record including the exhibited documents were put to accused. In his defence, the accused stated that he gave the cheque in question as security to the complainant and complainant has misused the cheque in question and cheated him.
Accused expressed his desire to lead DE. Accused examined himself as DW-1. He was examined and cross-examined. Thereafter, D.E. was closed vide order dated 30/05/2018.
M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 4 of 10
6. I have heard the arguments of both the parties and perused the record of the case meticulously.
7. In order to prove an offence under Section 138 NI Act, following ingredients are required to be fulfilled :
i) That there is legally enforceable debt or liability;
ii) The drawer of the cheque issued the cheque to discharge in part or whole the said legally enforceable debt or liability;
iii) The cheque so issued was returned unpaid by the banker of the drawer;
iv) Legal demand notice was served upon the accused and the accused failed to make the payment within15 days of the receipt of the said notice.
8. It is a well-settled position of law that when a negotiable instrument is drawn, two statutory presumptions arise in favour of the complainant, one under Section 139 and other under Section 118(a) of the NI Act. The court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 5 of 10 needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon. [Reliance placed on M.S. Narayana Menon v. State of Kerala, (2006) 6 SCC 39].
9. Section 138 Negotiable Instruments Act is attracted in cases where any cheque drawn by a person on an account maintained by him to the 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 standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from the account by an agreement made with that bank, such person shall be deemed to have committed an offence.
10. Undisputed factual matrix:-
On shifting of evidence on record and appreciation of arguments, the following facts have gone either unchallenged or are admitted:-
1. Cheque in question is signed by the accused and all the contents are filled by the accused.
2. The complaint filed is within limitation.
3. The complaint is within jurisdiction.
4. Cheque in question was issued by the accused to the complainant.
5. Accused purchased the garments on credit basis from the complainant.M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 6 of 10
6. The said garments were provided by the complainant to the accused against an invoice Ex. CW-1/B.
7. Legal notice of demand was received by the accused and same was not replied.
11. Contentious points:-
On appreciation of arguments and shifting of evidence, the following contentious points arise:-
1. Whether there exists a legally recoverable debt?
2. Whether the cheque in question was issued against legally recoverable debt?
12. Points of determination:-
1. Whether there exists a legally recoverable debt?
It is the case of the complainant that the legally recoverable debt exists on account of the supply of goods against the invoice Ex. CW-1/B. The accused disputes the debt on the ground that entire payment is already made regarding the cheque in question and the complainant has misused the cheque.
Therefore, the only dispute which requires to be determines whether the payment of Ex. CW-1/B was made by the accused or not. It is brought out from the cross-examination of the accused that accused has not placed on record any document on record to show that the payments were made by him. Accused has not stated whether the amount alleged was paid M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 7 of 10 at one time or on different occasions. It is further not stated whether the payment was made by way of cash or cheque or bank transfer. It is the admitted position that no transaction between the parties was more than the amount of Rs. 50,000/-. As per Section 118 of NI Act the statutory presumption arises in the favour of the complainant, that there exists a valid consideration for which the negotiable instrument was drawn. This presumption is a rebuttable presumption and the accused is required to raise a probable defence. In the present case, accused is not able to prove anything in his defence. Further, accused has taken a defence that the complainant has misused the cheque in question. However, it is not explained by the accused that how the cheque was misused. Rather, it is an admitted fact that no action or police complaint was filed by the accused for the misuse of the cheque in question.
Therefore, the complainant has successfully proved that a legally recoverable debt was existed in his favour.
2. Whether the cheque in question was issued against legally recoverable debt?
It is the case of the complainant that the cheque in question has given against the discharge of the debt.
Per contra, it is the defence of the accused that the cheque in question was issued as a security. It is admitted by the accused that all the contents on the cheque in question was filled by the accused himself. M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 8 of 10 Accused has failed to explain if it all that the cheque in question was given as security that why the date on the cheque was mentioned on which it could be presented in the bank. Further, accused has failed to explain that whether the payment made by him is before or after the date mentioned on the cheque in question.
The primary question was required to be answered whether on the date on which the cheque in issued, liability or debt existed or the amount is legally recoverable. The accused has not clarified that whether the cheque in question was issued on 24/04/2016 or before that. Further, it is also important to note that if the payment was already made then why payment of the present cheque was not stopped or why the complaint is not filed against the complainant.
In Credential Leasing & Credit Ltd vs Shruti Investments and Ors 2015 (151) DRJ 147, it was held that there is no merit in legal submission of the accused that only on account of the fact that the cheque in question was issued as a security in respect of contingent liability, the complaint u/s 138 NI Act would not be maintainable. It is required to examine that on the date of presentation of the dishonoured cheque the ascertained and crystallized debt or other liability did not exist. The onus to raise a probable defence would lie on the accused, as the law raises a presumption in favour of the holder of the cheque that the dishonoured cheque was issued for the debt or liability.
In the present of case the burden of proof on the accused is not M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 9 of 10 discharged.
13. Conclusively, in light of the above discussions and reasons, this court finds accused Neeraj Verma is guilty of offence punishable U/s 138 of the Act. Hence, accused Neeraj Verma stands convicted for the said offence.
14. Let the convict be heard on the quantum of sentence on 18/09/2018 at 02.00 pm. Copy of this judgment be given dasti to the convict.
Announced in the open court on 06.09.2018 (NIHARIKA KUMAR) MM-04/NI Act/SD/Saket New Delhi/06.09.2018 Certified that this judgment contains 10 pages and each page bears my signature.
(NIHARIKA KUMAR) MM-04/NI Act/SD/Saket New Delhi/06.09.2018 M/S BHAWNA APPARELS Vs. NEERAJ VERMA CC NO. 472573/2016 Page 10 of 10