Delhi District Court
Mr. Suresh Goyal vs Dr. Alok Gulati on 24 December, 2021
IN THE COURT OF SHRI DEEPAK SHERAWAT: SENIOR CIVIL JUDGE
CUMRENT CONTROLLER, KARKARDOOMA COURTS (SHAHDARA).
CS No.8057/2016 (Old No.182/2013)
Mr. Suresh Goyal
S/o Late J.P. Goel
R/o D504, Prince Apartments,
Plot No.54, I.P. Extension,
Patparganj, Delhi110092.
.............Plaintiff
Versus
1. Dr. Alok Gulati
S/o Mr. K.S. Gulati,
220A, Pocket B,
Mayur Vihar, PhII,
Delhi110092.
2nd Address:
Dr. Alok Gulati
S/o Mr. K.S. Gulati,
A50, Sector 56,
Noida, U.P.
3rd Address
Dr. Alok Gulati
S/o Mr. K.S. Gulati,
A312, Sector 47,
Noida, U.P.
............ Defendant
Date of Institution : 30.07.2013
Date of Reserving order : 15.12.2021
Date of Judgment : 24.12.2021
CS No.8057/2016 Page No.1
SUIT FOR RECOVERY.
JUDGMENT
1. This is a suit for recovery of money. As per the averments in the plaint, plaintiff had advanced a friendly loan of Rs 2 lacs to the defendant on 27/05/2011 and the defendant executed a promissory note to the plaintiff and also issued a post dated cheque No. 911720 dated 07/08/2012 for Rs 2 lacs to the plaintiff. The aforesaid cheque was returned unpaid by the bank when presented for encashment by the plaintiff on 07/08/2012 together with return memo dated 08/08/2012 with the remarks "Funds Insufficient". Plaintiff sent a legal notice dated 14/08/2012 to the defendant calling upon him to pay the cheque amount and on failure of the defendant to return the money, plaintiff filed a case u/s 138 of Negotiable Instrument Acts, 1881 and also instituted the present suit.
2. In written statement, the defendant has denied having received any loan from the plaintiff or having issued any promissory note, letter or cheque in this respect. Defendant has stated that he was negotiating for a loan in December, 2004 for which he had kept certain documents ready such as signed cheques, receipts cum promissory note etc., but said documents were not used and kept lying at his Diagnostic Centre at Mayur Vihar, Delhi and when on 01/04/2012, the said premises was being whitewashed, he decided to take those documents to his residence at Noida, but the leather bag in which those documents were kept was picked up from the rear seat of his car and he made a complaint to the police for loss of documents on 05/04/2012. Defendant has alleged that plaintiff somehow got hold of those CS No.8057/2016 Page No.2 documents and misused them to create documents presented in this case. Defendant has further stated that the cheque bears four digit account number, whereas, in the year 2011, when the plaintiff claims that the said cheque was issued, accounts number had been converted to 13 digits. Defendant has further stated that the documents relied upon by the plaintiff were only signed by him and the details had been filled in by the plaintiff by forgery.
3. In replication, plaintiff reaffirmed his case and denied the defence taken by the defendant.
4. On the basis of the parties following issued were framed:
i. Whether plaintiff is entitled to decree for recovery of suit amount as claimed:OPP ii. Whether the plaintiff is entitled to interest on the said amount as claimed?OPP iii. Relief.
5. In evidence, plaintiff has examined two witnesses. He has examined himself as PW1 and testified by way of affidavit Ex. P1 reiterating the contents of the plaint. He has relied upon those documents which has been proved by PW2.
6. PW2 is a witness summoned from the Court where plaintiff's complaint u/s 138 NI Act is under trial. He has produced record of the said case. He had brought the summoned record i.e. NI 544/114/12 PS Madhu Vihar under Section 138 NI Act CS No.8057/2016 Page No.3 titled Suresh Goyal vs. Dr. Alok Gulati. The certified copy of promissory note was marked as Ex. PW2/1; certified copy of cheque bearing no.911720 dated 07.08.2012 amounting to Rs.2 Lacs drawn on Canara Bank was marked as Ex. PW2/2; certified copy of letter dated 27.05.2011 was marked as Ex. PW2/3; certified copy of Bank Returning Memo dated 08.08.2012 was marked as Ex. PW2/4; certified copy of legal notice dated 14.08.2012 was marked as Ex. PW2/5 and certified copy of postal receipts were marked as Ex. PW2/6 (colly).
7. Defendant has taken stand as DW1 and deposed by way of affidavit Ex DW1/A whereby he has reaffirmed his defence set out in written statement. He has relied upon following documents : registered agreement dated 01.06.2014 was marked as Mark A; copy of MTNL Bill dated 08.08.2004 was marked as Ex. DW 1/2; transfer memorandum dated 03.10.2007 issued by new Noida Authority was marked as Ex. DW1/3; copy of letter dated 06.09.2013 to bank manager, Canara Bank, Mayur Vihar Phase II, Delhi was marked as Ex. DW1/4; copy of complaint dated 05.04.2012 to DCP (East), Shalimar Park, Delhi; copy of complaint dated 05.04.2012 to SHO PS Pandav Nagar was marked as Ex. DW1/5 and original register of Xray record from 08.12.2009 to 15.11.2011 was marked as Ex. DW1/6.
Defendant has also examined DW2, an official from Canara Bank, to prove attested copy of cheque issue register dated 06/09/2013 as Ex DW2/1.
8. I have heard arguments and perused the record.
9. My Issuewise findings are as under:
CS No.8057/2016 Page No.4Issues No. 1 and 2:
i. Whether plaintiff is entitled to decree for recovery of suit amount as claimed:OPP ii. Whether the plaintiff is entitled to interest on the said amount as claimed?OPP
10. Burden to prove these issues was on the plaintiff. Apart from his oral testimony, plaintiff has brought in evidence other relevant documents. He has proved pro note alleged to have been made by defendant as Ex PW2/1. This pro note records the transaction of loan of Rs 2 lacs given by the plaintiff to the defendant on 27/05/11. Ex.PW2/1 also comprises of the receipt issued by defendant in token of money received from the plaintiff. Defendant, while deposing as DW1, has admitted in his cross examination that the promissory note and the receipt Ex PW2/1 bear his signatures as well as his name, his father's name and his address in his own handwriting.
11. Similarly, defendant has admitted in cross examination his signatures on cheque Ex PW2/2 which was, as per plaintiff, issued by him to repay the loan amount of Rs 2 lacs. There is also a letter dated 27/05/2011 which, it is claimed by the plaintiff, was written by the defendant acknowledging the loan and issuance of aforesaid cheque. This letter is proved as Ex PW2/3 and in his cross examination, it is admitted by defendant that said letter has been signed by him.
12. On the basis of these documents and in the light of the admissions made by the defendant with regard to execution thereof, it can be held that plaintiff has, prima facie and on the preponderance of probability, proved that defendant has received the loan of Rs 2 lacs from the plaintiff and has made pro note ExPW2/1 and issued CS No.8057/2016 Page No.5 Cheque Ex PW2/2 in favour of the plaintiff. Pro note and cheque being negotiable instruments, once it comes to be proved that the said instrument was made or issued by the maker or drawer thereof, by virtue of clause (a) of section 118 of Negotiable Instrument Act, it is to be presumed that these instruments, i.e promissory note Ex PW2/1 and cheque Ex PW2/2 were made or drawn for consideration and when these documents were negotiated, it was done for consideration. It is further to be presumed under clause (b) of section 118 that the pro note and the cheque were made or drawn on the date which they bear. Section 118 clause (g) makes a further presumption that holder of a negotiable instrument is a holder in due course. By reason of these presumptions which the court is obliged to act upon, it is proved that defendant has created these instruments in consideration of amount of Rs 2 lacs received from the plaintiff.
13. After plaintiff discharges his initial burden to prove his case, the onus shifts to the defendant to prove the contrary and rebut the presumptions.
The Hon'ble Supreme Court in M.S. Narayana Menon @ Mani v. State of Kerala and Another, (2006) 6 Supreme Court Cases 39, has observed as follows:
"In terms of Section 4 of the Evidence Act whenever it is provided by the Act that the Court shall presume a fact, it shall regard such fact as proved unless and until it is disproved. The words 'proved' and 'disproved' have been defined in Section 3 of the Evidence Act. Applying the said definitions of 'proved' or 'disproved' to the principle behind Section 118 (a) of the Negotiable Instruments 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 nonexistence of the consideration so probable that a prudent man ought, under CS No.8057/2016 Page No.6 the circumstances of the particular case, to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon. It is not necessary for the defendant to disprove the existence of consideration by way of direct evidence. The standard of proof evidently is preponderance of probabilities."
14. In T.G. Balaguru v. Rramachandran Pillai, (2010) 2 MLJ 861 at page 862 wherein it is held as follows:
"As soon as execution of promissory note is proved, rule of presumption laid down under Section 118 of Negotiable Instruments Act is to be raised that promissory note is supported by consideration. Presumption under Section 118 of Negotiable Instruments Act is one of law and thereunder a Court shall presume inter alia that negotiable instrument or the endorsement was made for consideration. Once statutory presumption is raised, onus of proving absence of consideration is on the executant. When initial burden is discharged by the Plaintiff, the burden shifts to the Defendant to prove that promissory note is not supported by valid consideration. It is for the Defendant to rebut the presumption by establishing that he did not receive consideration by direct evidence or by bringing on record the preponderance of probabilities."
15. N.S. Arumugam v. Trishul Traders, Dealers in Ferrous and nonFerrous Iron Scrap Rubbish, Contractors, Madras and others, (2006) 2 MLJ 41, 42 (DB), is relied on the side of the Respondent/Plaintiff, wherein it is laid down as follows:
CS No.8057/2016 Page No.7"The burden of proof as a question of law rests on the plaintiff, but since the execution is proved, Section 118 of the Negotiable Instruments Act imposes a duty on the court to raise a presumption in his favour that the said instrument was made for consideration and this presumption shifts the burden of proof in the second sense, that is, the burden of establishing a case shifts to the defendants. If we consider the present case in the light of the above said principles, we have to hold that the trial court has wrongly thrown the burden of proof on the plaintiff without drawing the legal presumption in favour of the plaintiff when the defendants have admitted the execution of exhibit Al. Unless and until the defendant either by direct evidence or by circumstantial evidence acceptable to the court proves that the negotiable instrument was not supported by consideration, the burden on the defendants is not shifted. We have to see whether the defendants have adduced acceptable evidence and discharged their burden and shifted the burden to the plaintiff to prove his case."
16. In Bharat Barrel and Drum Manufacturing Company v. Amin Chand Payrelal AIR 1999 Supreme Court 1008 at page 1009, it is observed as follows:
"Once execution of the promissory note is admitted, the presumption under Section 118 (a) would arise that it is supported by consideration. Such a presumption is rebuttable. The defendant can prove the nonexistence of consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the nonexistence of the consideration can be either direct or by bringing on CS No.8057/2016 Page No.8 record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the nonexistence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118 (a) in his favour."
17. The decision in K.P.O. Moideenkutty Hajee v. Pappu Manjooran and another (1996) 8 SCC 586 at page 587, it is held as follows:
"When the suit is based on pro note, and promissory note is proved to have been executed, Section 118 (a) raises the presumption, until the contrary is proved, that the promissory note was made for consideration. That initial presumption raised under Section 118 (a) becomes unavailable when the plaintiff himself pleads in the plaint different considerations. If he pleads that the promissory note is supported by a consideration as recited in the negotiable instrument and the evidence adduced in support thereof, the burden is on the defendant to disapprove that the promissory note is not supported by consideration or different consideration other than one recited in the promissory note did pass. If that consideration is not valid in law nor enforceable in law, the court would consider whether the suit pro note is supported by valid consideration or legally enforceable consideration. The burden of proof is of academic interest when the evidence was adduced by the parties. The court is required to examine the evidence and consider whether the suit as pleaded in the plaint has been established and the suit requires to be decreed or dismissed."CS No.8057/2016 Page No.9
18. In order to dislodge the presumption, the defendant has taken the plea that above said pro note and cheque were never meant for or handed over to the plaintiff and those were prepared in December 2004 at the time when he was negotiating a loan transaction and those instruments were kept ready in advance. It is his defence that these documents were not used in the said transaction and were lost in the process when he was shifting them from his diagnostic centre at Mayur Vihar to his residence at Noida on 01.04.2012. In this respect, defendant has produced in evidence a complaint dated 05/04/2012 lodged with the police which is Ex DW1/5. However, this plea set out by the defendant does not appear to be very convincing in view of the fact that it is not comprehensible as to why documents prepared in the year 2004 were preserved until the year 2012, especially when these documents had no use or utility after those documents were not used in the transaction in 2004 in order for which they were prepared. It is not clear from the pleadings or evidence of the defendant if said transaction also fell apart or came to fruition. No details regarding the said loan transaction have been revealed by the defendant. Defendant did not prefer to examine any person related to said loans transaction, let alone the other party. Conduct of the defendant in preserving these documents for so many year, more so when these documents had lost their significance, does not conform to the behaviour of a person of ordinary prudence and intelligence. No cogent explanation has come forth from the defendant as to why he did not destroy those documents and instead took pains to shift them.
19. In any case, it is not the plea of the defendant that these documents i.e. pro note and cheque were stolen by the plaintiff from his car. It is an oddity that even after CS No.8057/2016 Page No.10 having come to know about these document being in possession of the plaintiff, no criminal or civil remedy in this regard has been taken up by defendant. Defendant seems to have, so to say, adopted a laid back attitude in this regard to let the plaintiff get off easily.
20. Defendant has further alleged that the pro note Ex PW1/1 bears his address which he had left in the year 2007 and letter head Ex PW1/3 also shows the address where he did not live after 2004 which belies the claim of the plaintiff that these instruments were executed in the year 2011. This contention is also fallacious by reason of the fact that when defendant can preserve these documents till the year 2012 and still had no desire to destroy them until these documents went allegedly missing, there is also every possibility that defendant would have used these documents in the year 2011 to secure loan from the plaintiff. In any case, what address a pro note bears is not an essential part of it and cannot be brought in service to dispute it. It is an admitted fact that both the parties had long standing relations as friends and there is every possibility that plaintiff might not have paid much attention to the addresses mentioned on the pro note and letter.
21. Defendant has also got issues with the account number mentioned on cheque Ex PW2/2 which is in four digits. It is contended that bank account numbers had been changed to 13 digits by the year 2008 and therefore aforesaid cheque which is claimed by the plaintiff to have been issued in the year 2011 could not have 4 digits. However, aside from putting this question to PW1 in his cross examination, defendant has not brought on record any other evidence. No notification or circular governing the bank account numbers has been produced. In this respect, we may refer CS No.8057/2016 Page No.11 to the Report of the Technical Committee constituted by the Reserve Bank of India vide Memorandum dated August 10, 2012 to examine Uniform Routing Code and Account Number Structure in the country. The Report was submitted on 31/12/2012 reflecting upon the feasibility of doing away with the existing Indian Financial Structure Code (IFSC) structure in the RTGS/NEFT systems and the way forward for introduction of a common routing code and the International Bank Account Number (IBAN) across payment systems for increasing efficiencies. IBAN account numbering was adopted in the wake of the said report and existing account number at that time and IBAN account number were allowed to coexist for some time for transition purpose. Therefore, the issue raised by the defendant with the regard to digit numbers of the cheque ExPW2/2 does not hold water. Be that as it may, whatever be the digits in the accounts number mentioned on the cheque, this is none of the grounds for dishonour of a cheque and this position is fortified by the fact that cheque in question was not returned unpaid by the drawee bank on this ground, but it was returned for insufficiency of funds in the account of defendant. The returning memo of the drawee bank has been produced by the plaintiff in evidence as Ex PW2/4.
22. Another plea taken by the defendant that the alleged promissory note and the letter were not fully typed and blank documents have been typed by the plaintiff to create false and fabricated evidence also fizzles out in the absence of any evidence to stand for. A bare self serving statement is, by no means, sufficient to bring home the allegations of forgery or fabrication of documents. In view of the fact that the defendant is very particular in insisting upon the plea of denial of the purported contents in the pro note and letter, no conclusion can be simply arrived at by subjective satisfaction relating to the disputed contents. The defendant was required CS No.8057/2016 Page No.12 to bring evidence of forensic expert in relation to the pro note Ex PW2/1 and the letter Ex PW2/4. It is to be noted that forgery is a vehicle to commit other wrongs such as fraud. The defendant, in the present, case seems to indicate that plaintiff created these fake documents to commit fraud upon him.
23. Forgery in the civil claim applies balance of probabilities whereas for criminal prosecution applies beyond reasonable doubt as standard of proof. This different approach has drawn critique from courts because forgery is the act of crime which the standard must be the same with other crimes stipulated in the Penal Code. This was mentioned in Narayan Chettyar v. Official Assignee, Rangoon AIR 1941 PC when the court held, 'Fraud of this nature, like other charge of criminal offences, whether made in criminal or civil proceedings must be established beyond reasonable reason'. In Union of India v. Chaturbhai M. Patel & Co., (1976) 1 SCC 747, the Hon'ble Apex Court held that "fraud like any other charge of a criminal offence whether made in civil or criminal proceedings, must be established beyond reasonable doubt."
24. However in Rattan Singh & Others v. Nirmal Gill & Others, (2020) SCC OnLine SC 936 while relying upon another case titled as Anil Rishi vs Gurbaksh Singh (2006) 5 SCC 558 the Hon'ble Supreme Court has observed that it is settled that the standard of proof required in a civil dispute is preponderance of probabilities and not beyond reasonable doubt.
25. Defendant, in the present case, has not produced any evidence to prove any fraud or forgery on the part of the plaintiff in preparing documents Ex PW2/2 to Ex CS No.8057/2016 Page No.13 PW2/4. Thus he has not succeeded even on the basis of preponderance of probabilities, let alone evidence beyond reasonable doubt. In any case, section 20 of the Negotiable Instrument Act lays down that where one person signs and delivers to another a paper stamped in accordance with the law relating the Negotiable Instruments and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument for any amount specified therein and the person so signing shall be liable upon such instrument.
26. In Shantidas V. Hiralal, 59 IC 657 and Ibrahim v. Ramdas AIR 1954 Mad 532 it has been held that as per Section 20 of the Negotiable Instruments Act, the authority implied by a signature in a blank instrument was wide that the party so signing was bound to a holder in due course even though the holder was authorised to fill for a certain amount. A person in possession of a bill incomplete in any material particular had a prima facie authority to fill the same and as such, he was an agent of the person delivering the blank instrument.
27. It is relevant for this Court to aptly point out the decision of this Court in Mohamed Ali v. Abdul Sinab (2001) 1 M.L.J. 371 at page 372 wherein it is held that 'Section 20 of the Negotiable Instruments Act is itself authority to the holder of the signed instrument to fill up the blanks and to negotiate the instrument.'
28. It is evident from the material produced by the plaintiff in evidence and failure of the defendant to meet out his defence that plaintiff had extended a loan of Rs.2 CS No.8057/2016 Page No.14 Lakhs to the defendant against which the latter had executed documents Ex. PW2/1 to Ex. PW2/3 and which he has failed to repay. Therefore, the suit of the plaintiff is decreed and defendant is directed to pay a sum of Rs.2 Lakhs to the plaintiff along with interest @ 9% from the date of filing of the suit till the date of realization. costs of the suit are also awarded. Decree sheet be prepared in terms of the order.
File be consigned to record room.
Typed to the dictation directly (Deepak Sherawat)
corrected and pronounced in SCJ/RC (Shahdara)
the open court on this 24th day Karkardooma Courts,
of December, 2021. Delhi/24.12.2021.
CS No.8057/2016 Page No.15