Delhi District Court
M/S Kanhaiya Enterprises vs Rahul Duggal on 31 January, 2022
IN THE COURT OF MS AISHWARYA SINGH KASHYAP,
METROPOLITAN MAGISTRATE (NI ACT),
KARKARDOOMA COURTS, DELHI
M/S Kanhaiya Enterprises Vs Rahul Duggal
CC NO. 59904/2016 [Gandhi Nagar]
CNR Number: DLET020082722016
M/s Kanhaiya Enterprises
Through its Prop. Sh. Prem Prakash Sethia
At A/48/11, Site IV, Sahibabad Industrial Area,
Ghaziabad U.P. .......... Complainant
Vs
Sh. Rahul Duggal
S/o Sh. Ravi Duggal
Prop. of M/s Shri Balaji Enterprises at Block-5, Lane 7, H.No.15,
Geeta Colony, Delhi, 110031 .........Accused
Complaint Case No.: 59904/2016
Date of Institution: 27.10.2016
Offence alleged: Section 138 Negotiable Instruments Act,
1881
Plea of the accused: Pleaded not guilty (No Legal Liability)
Final Order: Acquitted
Date of Decision: 31.01.2022
Argued By:
Ld. Counsel for the Complainant- Shri Suresh Kumar
Ld. Counsel for the Accused- Shri Prateek Mehta
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
Date: 2022.01.31 22:04:54
KASHYAP +05'30'
1 of 18
M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016
JUDGEMENT
Factual Matrix
1. The complaint is based on alleged facts that M/s Kanhaiyalal Enterprises through its proprietor Sh. Prem Prakash Sethia - (hereinafter 'the complainant') filed the instant case upon dishonour of cheques for the part payment of fabric material supplied to Sh. Rahul Duggal-(hereinafter 'the accused') whereby against the total bill of Rs. 1,74, 500/-(against Bill/Invoice nos. 10, 12 and 13), an amount of Rs. 1,04,500/- was promised to be paid in cash and an amount of Rs. 70,000/- was to be paid by two PDCs bearing no. 114281, dated 16.07.2016, for an amount of Rs. 40,000/- drawn on ICICI Bank, Krishna Nagar, Delhi and cheque bearing no. 114282, dated 16.07.2016, for an amount of Rs. 30,000/- drawn on ICICI Bank, Krishna Nagar, Delhi respectively (hereinafter, 'the cheques in question'). Upon first presentment, the cheques in question were dishonoured with remarks "Insufficiency of Funds" vide return memos dated 19.07.2016 and again upon the second presentment vide return memos dated 16.09.2016. The complainant served legal demand notice on the accused dated 29.08.2016. On failure of the accused to pay the amount within 15 days, the complainant company filed the instant complaint within the period of limitation for committing the offence under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter 'The Act').
Pre-summoning Evidence, Cognizance and Notice
2. Pre-summoning evidence was led by the complainant and after consideration, the Ld. Predecessor took cognizance and issued summons vide order dated 24.10.2016. The accused AISHWARYA Digitally signed by AISHWARYA SINGH SINGH KASHYAP 2 of 18 Date: 2022.01.31 KASHYAP 22:05:11 +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 entered appearance and notice under Section 251 of the Code of Criminal Procedure, 1973 (hereinafter, 'CrPC') for the offence under Section 138 of the Act was served upon accused on 06.10.2017, to which he pleaded not guilty and claimed trial. In his detailed plea of defence, the accused pleaded as under:-
Admission/Denial of documents by the accused:
1. It is correct that the cheque in question bears my signature, name of my bank and my account number. I have filled the column of amount in words and digits on cheques in question and I did not fill the remaining contents of cheques in question.
2. I did not receive any legal demand notice issued by the complainant.
Plea of Defence of the accused I do not know the complainant firm or its proprietor. I have never purchased any goods from the complainant firm ever in my life. I had given the cheques in question to Pankaj Jain, brother of proprietor of complainant firm as security with respect to job work of dying to be done by Pankaj Jain, proprietor of another firm namely M/s Kanhaiya Textiles. I had paid Rs. 70,000/- to Pankaj Jain for job work in his account through another cheque. I asked Pankaj Jain several times to return my cheques in question but he did not return the same to me on the pretext that same had been misplaced.
I have no liability towards the complainant with respect to cheques in question. Present complaint is false and fabricated.
Complainant's Evidence
3. During the trial, the complainant has led the following oral and documentary evidence against the accused to prove his case.
Oral Evidence
I. CW1: Sh. Prem Prakash Sethia/the
complainant on 24.10.2016;18.01.2019
Documentary Evidence
I. Ex. CW/1: Pre-summoning evidence by way of
affidavit by the complainant.
II. Ex. CW1/A&B: Cheques in Question
III. Ex. CW1/C&D: Return Memos dated 19.07.2016 Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2022.01.31 22:05:25 +05'30' 3 of 18 M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 IV. Ex. CW1/E&F: Return Memos dated 03.09.2016 V. Ex. CW1/G: Legal Demand Notice VI. Ex. CW1/H: Postal Receipts VII. Ex. CW1/I: Copy of Tracking Report X. Ex. CW1/J,K&L: Copy of Invoice Nos 10, 12 and 13 XI. Ex. CW1/DX2(OSR): Copy of Business Card in the name of Kanhaiya Textiles.
XII. Ex. CW1/DX1(ODR): Copy of Passbook/Statement of the accused.
The relevant excerpts of the evidence have been reproduced hereunder:
I have three brothers, namely Pawan, Pankaj & Paras. My brother Pawan and Pankaj are dealing in the business of ready made garments and fabrics, respectively...Said Pawan has been dealing in said business since 2006 at Gandhi Nagar, Delhi and said Pankaj has been dealing in his business since 2013 at Gandhi Nagar, Delhi. I have not filed any written proof of the order made by the accused for purchasing fabrics from me. Vol. Accused had made oral order for the same with me. I have been dealing with the accused since year 2013-14. I have not filed my statement of account qua dealing with the accused. My brother Pankaj is doing business under the name and style of Pankaj Textiles. I and my brother are not related to any firm namely Kanhaiya Textiles. It is wrong to suggest that accused had not dealing with me so far. Vol. Accused has been dealing with me as well as my brother Pankaj Sethiya. It is wrong to suggest that accused used to deal with my brother Pankaj Sethiya and the both cheques in question were given as security to him. I can't say whether accused had paid Rs. 70,000/- to said Pankaj Textiles through three cheques encashed on 02.05.2014/12.06.2014 & 12.06.2014 (Ld. Defence counsel confronted with Passbook of accused and same is Ex. CW1/DX1 (OSR). It is correct that accused had given signed cheques in question with mentioning of amount in digits and words. Vol. I or my staff had filled the name of payee and date on cheques in question. Kanhaiyalal Ji is my uncle. It is wrong to suggest that said Kanhaiyalal had taken blank signed cheques in question with mentioning of amount from the accused for giving the same to my brother Pankaj as accused had dealing with my brother Pankaj. It is wrong to suggest that I had taken cheques in question from my brother and misused the same against the accused. It is AISHWARYA Digitally signed by SINGH AISHWARYA SINGH KASHYAP Date: 2022.01.31 22:05:45 4 of 18 KASHYAP +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 correct that visiting Card Ex. CW1/DX2 (OSR) is visiting card of my firm as well as that of my brother Pankaj. It is wrong to suggest that I have deposed falsely on the point/fact as to I or my brother has no association with Kanhaiya Textiles. I used to file ITR and Sales Tax Return. It is wrong to suggest that I have filed false and fabricated bills Ex. CW1/J, Ex. CW1/K & Ex. CW1/L. It is wrong to suggest that I have not shown said bills in my Sales Tax Return. It is wrong to suggest that accused does not owe any outstanding liability of Rs. 1,74,500/- towards me. It is wrong to suggest that accused had never promised to pay outstanding amount of Rs. 1,04,500/-to me. It is correct that there is no receiving or acknowledgement of either accused or his representative on these bills Ex. CW1/J to Ex. CW1/L. Vol. Rickshaw puller has delivered goods to the accused... It is wrong to suggest that I am deposing falsely.1 Statement of Accused
4. Thereafter, in order to allow the accused to personally explain the circumstances appearing in evidence against him, his statement under Section 313 CrPC read with Section 281 CrPC was recorded without oath on 02.03.2019. Therein, the accused denied all the allegations against him and stated as hereunder:
1. It is correct that cheques in question bears my signature and my bank account number. I had filled the amount in words and digits as appearing on cheque in question. However, I did not write the date and name of payee on the body of cheques in question.
2. I have given cheques in question to some Kanhya Lal, uncle of complainant as security because I had to get my cloths washed from the brother of complainant namely Pankaj Jain and they insisted for security cheques. Said Pankaj Jain had done work of washing for me for sum of Rs. 70,000/- approximately which I had paid through my bank account. Accordingly, I do not owe any outstanding liability towards complainant or aforesaid persons and they had misused my blank signed security cheques. I have also filed criminal complaint against complainant and his brother Pankaj Jain and uncle Kanhya Lal which is pending before the court of Ms. Swati Sharma, Ld. MM/East/KKD Courts, Delhi.
Complainant had filed forged and fabricated bills and same do not bear my signature.
3. I did not receive legal demand notice issued by the complainant.
4. Yes, I want to lead evidence in my defence.
1 Cross-Examination of CW1. Sh. Prem Prakash Sethia/the complainant on 18.01.2019.
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
Date: 2022.01.31 22:06:00
5 of 18
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Defence Evidence
5. The accused opted to lead defence evidence and furnished the following oral and documentary evidence during cross- examination of complainant.
Oral Evidence I. DW1: Sh. Anil Kumar, Ahlmad in the court of Sh.
Jitender Pratap Singh on 27.09.2019 II. DW1: Sh. Sachin Kumar Goyal, Assistant Ahlmad in the court of Sh. Jitender Pratap Singh on 05.02.2020 Documentary Evidence I. Ex DW1/1(Colly): Copy of Criminal Complaint dated 18.08.2018.
II. Ex. CW1/DX2(OSR): Copy of Business Card in the name of Kanhaiya Textiles.
III. Ex. CW1/DX1(ODR): Copy of Passbook/Statement of the accused.
6. Thereafter, the matter was listed for final arguments. Ld. Counsel for the complainant has submitted that the statutory presumptions under Sections 118 and 139 of the Act have been raised in favour of the complainant and the accused has failed to rebut the same. He has questioned the alleged date of handing over of the security cheques in May 2014 as they bear a pre- printed date i.e.10.10.2014. Further, the defence of misuse has also been questioned since the accused did not instruct the bank to 'stop payments'.
Per contra, Ld. Counsel for the accused has submitted that the accused never claimed that the cheques in AISHWARYA Digitally signed by AISHWARYA SINGH SINGH KASHYAP Date: 2022.01.31 22:06:15 6 of 18 KASHYAP +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 question were handed over in the month of May, 2014 therefore, the objection of the complainant has no material bearing on his defence. Further, it is claimed that there was no privity of contract between the accused and the complainant since the transaction took place between the accused and the brother of the complainant, Sh. Pankaj Jain who was also given the two security cheques in question, and was also paid the entire amount of Rs. 70,000/-. Further, the complainant has failed to prove the supply of any fabric to the accused in the absence of furnishing any copies of signed invoices, statement of ledger/stock register or sales tax return. The complainant failed to file any suit for recovery against the accused. The accused has maintained a consistent stance throughout the trial along with furnishing documentary proof of payment of the cheque amount to the brother of the complainant, whereas the complainant has concealed material particulars from the court. The accused has also challenged the delivery of the legal demand notice. The accused has placed reliance on M/s Hi-Tech Automation vs J.K.Sharma 2014 SCC OnLine P&H 17317; Hans Kumar Jain vs Renu Gandotra MANU/DE/0661/2015; Jalal & Ors vs State of Goa MANU/MH/2012/2017; M/s Kumar Exports vs M/s Sharma Carpets AIR 2009 SC 1518; Rangappa vs Sri Mohan (2010) 11 SCC 441; Sachin Food Processor vs Sanjay T. Pathak & Ors MANU/MH/0631/2016; Veena Rani Chhabra vs Manju Rohida 2008 (155) DLT 447 and Kali Ram vs State of Himachal Pradesh MANU/SC/0121/1973.
AISHWARYA Digitally signed by
AISHWARYA SINGH 7 of 18
SINGH KASHYAP
Date: 2022.01.31 22:06:41
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M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016
Legal Position
7. In order to establish the offence under Section 138 of the Act, the prosecution must fulfil all the essential ingredients of the offence, as highlighted hereunder.
First Ingredient: The cheque was drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity; Second Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability; Third Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank; Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of the cheque from the bank; Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
8. Further, all the conditions stipulated under Section 142 of the Act must be satisfied. The complainant asserts that he has prima facie satisfied all the aforesaid conditions. However, the accused has disputed the fulfilment of the second and fifth ingredients. The same are being considered hereinafter.
AISHWARYA Digitally signed by AISHWARYA
SINGH KASHYAP 8 of 18
SINGH KASHYAP Date: 2022.01.31 22:06:56 +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 Appreciation of Evidence Standard of Proof
9. The scales of degree of proof required, in a cheque dishonour case, have been set by the Hon'ble Supreme Court in Rangappa vs Sri Mohan (2010) 11 SCC 441 holding that once the cheque and signatures are admitted, presumptions in favour of the complainant are raised. However, said presumptions are rebuttable in nature and the 'standard of proof' required on part of the accused is that of 'preponderance of probabilities'. This can be achieved either by adducing evidence in defence or by raising probable defence whilst relying on the evidence already on record. 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. It is not necessary for the accused to come in the witness box in support of his defence. 2 The accused has raised a consistent and probable defence in the instant case by raising doubt over the existence of transaction/legally enforceable liability/ the version version put forth by the complainant. Absence of Legally Enforceable Debt/Liability and Adducing Probable Defence
10. The second ingredient is the primary point of contention in the present case wherein, the accused has denied the existence of any liability towards the complainant. Herein, the accused has raised a two-fold defence wherein he submitted that no transaction ever took place between him and the complainant thus negating the existence of any liability. In-fact, he submitted 2 Basalingappa vs Mudibasappa (2019) 5 SCC 418.
AISHWARYA Digitally signed by SINGH AISHWARYA SINGH KASHYAP 9 of 18 Date: 2022.01.31 22:07:11 KASHYAP +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 that the transaction took place between the him and Mr. Pankaj Jain, the brother of the complainant (and not the complainant). Further, Mr. Pankaj Jain was not only in possession of the security cheques in question but he was also duly paid the cheque amount of Rs. 70,000/- as reflected in the bank statement of the accused. It is clear that a person cannot be compelled to produce negative evidence in his/her defence. Thus, the accused must rebut the statutory presumptions on the basis of preponderance of probabilities in order to raise doubt over the existence of debt/liability. This view was reinforced by the Hon'ble Supreme Court in M/s Kumar Exports vs M/s Sharma Carpets AIR 2009 SC 1518 wherein, the court held as under:
The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the Complainant in a criminal trial...To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist.3 This has further been elaborated in Rangappa (supra) holding that:
Under Section 118(a) of the NI Act, the court is obliged to presume, until the contrary is proved, that the promissory note was made for consideration. It is also a settled position that the initial burden in this regard lies on the defendant to prove the non-existence of consideration by bringing on record such facts and circumstances which would lead the court to believe the non-existence of the consideration either by direct evidence or by preponderance of probabilities showing that the existence of consideration was improbable, doubtful or illegal."4 3 Paras 11 and 12. Digitally signed by 4 Para 23. AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2022.01.31 22:07:25 +05'30'
10 of 18 M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 Therefore, the existence of legally enforceable liability has been challenged by the accused on several grounds discussed hereunder upon raising of probable defence.
No Proof of Supply of Fabric to the Accused
11. Against the aforesaid backdrop wherein the accused has confronted the complainant with the existence of any transaction/liability between them, the proof of supply of fabric is germane to the existence of liability in the instant case. Evidently, the complaint itself is silent on details of the alleged order placed by the accused, or how long the parties were having business dealings with each other, or the statement of accounts or the proof of delivery. Whilst copies of invoices were furnished, it is admitted by the complainant that the same were not signed by either the accused or his representative.
I have not filed any written proof of the order made by the accused for purchasing fabrics from me. Vol. Accused had made oral order for the same with me. I have been dealing with the accused since year 2013-14....It is wrong to suggest that I have not shown said bills in my Sales Tax Return.... I have not filed my statement of account qua dealing with the accused. It is correct that there is no receiving or acknowledgement of either accused or his representative on these bills Ex. CW1/J to Ex. CW1/L. Vol. Rickshaw puller has delivered goods to the accused.5
12. However, no such rickshaw puller was brought on record nor any transport document was furnished in support of the claim put forth by the complainant. No copy of any Sales Tax Return reflecting the relevant bills have been furnished on record. Therefore, no reliance can be placed on such invoices in the absence of other supporting documentary/oral evidence. Once, the accused questioned the transaction/supply of fabric, it 5 Cross Examination of CW1 on 18.01.2019. AISHWARYA Digitally signed by AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2022.01.31 22:07:42 +05'30' 11 of 18 M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 was imperative on the part of the complainant to bring on record such documents/evidence that could support his claim. In the absence of such evidence, the defence of the accused stands probablized as held in M/s Hi-Tech Automation vs J.K.Sharma6 wherein the court held as under:
When a person claims that no material has been supplied to him, it is impossible for him to give evidence of such a negative fact. The burden was upon the complainant to duly prove the supply of material to the accused qua invoice Ex.C2. In order to prove the same, he produced the copy of invoice dated 4.11.2008 Ex.C2. A bill is a document which is capable of being prepared unilaterally by one party and the mere production of a bill is not sufficient to prove the supply of material and some more evidence is required. The complainant has neither produced any purchase order nor any goods receipt in respect of their supply. In the complaint, he has categorically claimed that material qua invoice Ex.C2 was supplied to the accused along with form ST38 accompanied with the consignment. The said form ST38 has also not been produced on record. Furthermore, no stock register has been produced by the complainant in order to show that indeed he was in possession of the material shown in the bill Ex.C2 as on the relevant date i.e. 4.11.2008 and the stock register of subsequent dates to show that such material was taken out of his firm. However, this Court is mindful of the fact that in his cross examination, the complainant has stated that accused had himself taken the material in his own transportation vehicle. In this respect, it may be noted that apart from his own interested testimony, the complainant has not examined any other independent witness who could have duly proved and corroborated the said fact. In such circumstances, it will not be safe to solely rely upon the copy of bill Ex.C2 itself to presume the supply of material to the accused. Resultantly, the complainant has failed to duly establish the supply of material to the accused qua bill Ex.C2 and the accused has succeeded in rebutting the presumption under Section 139 of the Act and consequently, it cannot be said that the cheque in question had been issued by the accused in favour of the complainant in discharge of his existing debt or liability.7
13. It must be borne in mind that in conjunction with the fact that the existence of liability/transaction between the parties is in question, the accused has also confronted the complainant 6 2014 SCC OnLine P&H 17317. Digitally signed by AISHWARYA AISHWARYA SINGH 7 Para 25. KASHYAP SINGH KASHYAP Date: 2022.01.31 22:08:08 +05'30'
12 of 18 M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 for misusing his security cheques given to the complainant's brother Mr. Pankaj Jain for a transaction which stood paid by the accused as per documentary evidence furnished by the accused. Inconsistencies in Complainant's Version/Concealing Material Facts
14. The cross-examination of the complainant elicited significant inconsistencies qua the details of the alleged transaction/liability claimed in the complaint.
i). The complainant concealed material facts from the court i.e. his association with his brother Mr. Pankaj Jain who also dealt in fabrics via a firm in the name of Pankaj Textiles as well as Kanhaiya Textiles. Further, the complainant concealed the fact that his brother had dealings with the accused. Whilst the complainant initially averred that his brother Pankaj Jain was not related with his firm Kanhaiya Textiles, he subsequently deposed that the visiting card of his firm i.e. Kanhaiya Textiles belonged to him as well as his brother Pankaj Jain.
I have three brothers, namely Pawan, Pankaj & Paras. My brother Pawan and Pankaj are dealing in the business of ready made garments and fabrics, respectively......My brother Pankaj is doing business under the name and style of Pankaj Textiles. I and my brother are not related to any firm namely Kanhaiya Textiles....
It is correct that visiting Card Ex. CW1/DX2 (OSR) is visiting card of my firm as well as that of my brother Pankaj. It is wrong to suggest that I have deposed falsely on the point/fact as to I or my brother have no association with Kanhaiya Textiles.8 In these circumstances, it is probable that the transaction took place between the accused and the brother of the complainant, Mr. Pankaj Jain, and that the accused handed over the security cheques in question to him and not the complainant.
8 Cross Examination of CW1 on 18.01.2019.
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
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ii). The accused has also furnished documentary evidence of payment of the amount mentioned in the cheques in question i.e. Rs. 70,000/- and also confronted the complainant with the same during his cross-examination, however, the complainant failed to explain the payment made by the accused or give any satisfactory response thereto.
It is wrong to suggest that accused had no dealing with me so far. Vol. Accused has been dealing with me as well as my brother Pankaj Sethiya. It is wrong to suggest that accused used to deal with my brother Pankaj Sethiya and the both cheques in question were given as security to him. I can't say whether accused had paid Rs. 70,000/- to said Pankaj Textiles through three cheques encashed on 02.05.2014/12.06.2014 & 12.06.2014 (Ld. Defence counsel confronted with Passbook of accused and same is Ex. CW1/DX1 (OSR).
iii). The complainant, despite being confronted as aforesaid, failed to bring on record the testimony of his brother, Mr. Pankaj Jain in support of his claim despite knowing that it was vital to give succour to the maintainability of the present complaint. No explanation is forthcoming in this respect as to why he was not called as a witness to rebut the claims made by the accused.
Copy of Bank Statement produced by the Accused
15. Throughout the trial, the accused has maintained a consistent stance that he did not have any transaction with the complainant. In-fact, he claimed that the transaction took place between him and Mr. Pankaj Jain, the brother of the complainant who was given an order of dying certain fabrics and he gave him two security cheques against this order. The accused paid Mr. Pankaj Jain the due order amount of Rs. 70,000/- and copy of his bank statement is Ex. CW1/DX1 wherein the statement reflects Digitally signed by AISHWARYA AISHWARYA SINGH SINGH KASHYAP Date: 2022.01.31 22:09:13 14 of 18 KASHYAP +05'30' M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016 payment dated 02.05.2014 for an amount of Rs 30,000/- vide cheque no. 153650 and payments dated 12.06.2014 for an amount of Rs. 20,000/- each vide two cheque nos 153651 and 153652 respectively to Pankaj Textil i.e. total payment of Rs. 70,000/- was paid by the accused to the brother of the complainant.9 The complainant was confronted with the aforesaid, however, he failed to produce any evidence that the payment was not related to the transaction in question. Additionally, it is queer to take note of the fact that the aforesaid payment amount is the exact alleged amount of Rs. 70,000/- (in factions of Rs. 30,000 and Rs. 40,000/- each) of the cheques in question, further shrouding doubt over the existence of liability in the instant case.
Criminal Case filed by the Accused against the Complainant
16. The accused has sought to file a criminal case for cheating against the complainant, his brother Pankaj Jain and uncle Kanhaiya Lal through his application under section 156(3) CrPC and its copy is Ex. DW1/1(Colly). The cross-examination of DW1 by the complainant was mechanical and did not challenge the veracity of the complaint filed by the accused in any manner. Therefore, considering the totality of the circumstances, the accused has successfully rebutted the statutory presumptions and raised a probable defence in his favour. Thereafter, the onus shifted on the complainant however, he has miserably failed to bring on record any evidence at all in support of its claim.
9 Relevant entries reflected at Page 6 of the document.
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
15 of 18
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17. In the present case, the accused has successfully rebutted the presumption by raising a probable defence for the reasons discussed as aforesaid. Despite shifting of the burden on the complainant, he has not been able to show any cogent evidence to prove legally enforceable debt or liability of the accused. On the contrary, the version of the complainant is riddled with several inconsistencies with respect to the material particulars of the liability amount. No justification is forthcoming with respect to the failure of the complainant to bring on record the account statements/proof of delivery/testimony of material witness i.e. his brother Mr. Pankaj Jain to prove the cheque liability against the accused and/or discredit the defence of the accused.
18. The accused has maintained a consistent and clear defence that the transaction took place between him and Mr. Pankaj Jain, brother of the complainant who was also given two security cheques in question against the transaction. The accused further paid the order amount of Rs. 70,000/- which is duly supported by documentary evidence/copy of bank statement and the complainant has failed to prove that the aforesaid payment is in relation to a different transaction. On the contrary, glaring loopholes in the version of the complainant do not inspire any confidence in the court; its testimony rests on shaky grounds and its version cannot be relied upon. The complainant has not approached the court with clean hands.
19. The complaint is absolutely silent in terms of the alleged order/transaction as well as the role of his brother Pankaj Jain and his dealings with the accused. During cross-
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
KASHYAP
Date: 2022.01.31 22:09:43 16 of 18
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examination, the complainant falsely stated that his brother Pankaj Jain did not have any role in the business whereas later, he admitted that their business card is the same. Further, the objection of the complainant with respect to date of handing over of the security cheques is untenable as it is not grounded in the primary defence of the accused. The essence of the case lies in the existence of the liability and the version of the complainant has dwindled juxtaposed with the probable defence successfully raised by the accused. First of all, the total claimed liability amount is Rs. 1,74, 500/- wherein the cheques in question only cover an amount of Rs. 70,000/-. The remaining amount is alleged to have been promised to be paid in cash. It is unfathomable that a prudent man would file a case for dishonour of Rs. 70,000/- and not file a suit for recovery for the entire amount of Rs. 1,74, 500/-. On the other hand, the accused has furnished cogent documentary evidence in support of his defence raising doubt over the existence of transaction/legally enforceable liability. Therefore, the complainant has failed to satisfy the second ingredient essential for the prosecution of complaint under Section 138 of the Act. Thus, the fifth ingredient does not warrant any analysis as the complainant has failed to prove the existence of legally enforceable liability.
Decision
20. In view of the aforementioned discussion, the accused has successfully raised a probable defence on the touchstone of preponderance of probabilities and the complainant has failed to prove all the essential ingredients of Section 138 of the Act.
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
17 of 18
Date: 2022.01.31
KASHYAP 22:09:58 +05'30'
M/s Kanhaiya Enterprises vs Rahul Duggal CC No 59904/2016
Accordingly, the complaint is dismissed and the accused is hereby acquitted of the charge of the offence punishable under Section 138 of the Act.
ORDER: Acquitted Announced during VC in Open Court on 31.01.2022. (This judgement contains 18/Eighteen signed pages.) Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2022.01.31 22:10:13 +05'30' Aishwarya Singh Kashyap) MM/NI Act(East)/KKD Courts Delhi 31.01.2022 18 of 18