Delhi District Court
M/S Tirupati Enterprises vs Ramesh Kumar Sharma on 17 April, 2015
IN THE COURT OF SH. ASHOK KUMAR, MM07,
SOUTH EAST, SAKET COURTS, NEW DELHI
CC No. 09/2/13
U/S 138 NI Act
M/s Tirupati Enterprises
through its proprietor
Smt. Usha Kejriwal,
Office at 11, Robert Street,
Kolkata700012.
Branch Office at 103, Skipper House,
6263, Nehru Place, New Delhi110019,
through her SPA Sh. Anil Aggarwal,
Branch Manager at Delhi Office. .......................Complainant
Versus
Ramesh Kumar Sharma,
Proprietor of
M/s R.K. Computers and Technical Services,
118, Hemkunt Chambers,
89, Nehru Place,
New Delhi110019.
Also at: R/o H7, Fire Station, Roop Nagar,Delhi110007.
Also at: R/o C150, Sector 49, Noida, UP201301.
Also at R/o M342, Sector25, Noida, UP201301.
. .............................. Accused
Offence Complaint of or proved. : Section 138 of Negotiable
Instrument Act.
Plea of accused : Pleaded not guilty
Date of Institution : 04.09.2010
CC No. 09/2/13 1 of 16
Date of Reserving order : 17.04.2015
Final order : Convicted
Date of pronouncement : 17.04.2015
JUDGMENT
FACTS OF THE CASE 1 The facts of the case as per the complaint and presummoning evidence of the complainant filed by way of affidavit which is also adopted as postsummoning evidence by the complainant are that the accused in discharge of his business liabilities regarding demand of mother boards and graphic card, issued 3 cheques bearing No. 640989, 640962 & 640981 dated 7.6.10, 28.06.10 and 29.06.10 for Rs. 1,28,525/, 1,26,150/ and 1,68,200/ all drawn on Corporation bank, Sector31, Noida, UP in favour of the complainant. Thereafter, the complainant presented the cheques for encashment which became dishonoured on account of "
Funds Insufficient". On the said intimation on returning memos dated 26.06.2010 and 06.07.2010, the complainant served a legal notice dated 14.07.2010 to the accused.
TRIAL PROCEEDINGS 2 Thereafter, the complainant filed the complaint under Sec. 138 NI Act after the accused failed to make the payment within 15 days of the receipt of legal notice. On the said facts, the accused was summoned and notice under Sec. 138 NI Act was framed against the accused to which he pleaded not guilty and claimed trial. It is pertinent to note that after framing notice u/s 251 Cr.P.C on 31.10.2011, the case was fixed for CE and complainant was duly cross examined on behalf of CC No. 09/2/13 2 of 16 accused and thereafter, the complainant evidence was closed and case was listed for statement of accused and DE vide order dated 13.09.2012.
3 Complainant proved the following documents in his presummoning
evidence :
i SPA in favour of AR of complainant is Ex. CW1/1.
ii Invoices as per affidavit of complainant are Ex. CW1/2 to
Ex. CW1/5..
iii Aforesaid Cheques and returning memo are Ex. CW1/6 to Ex.
CW1/11 .
iv Legal notice dated 14.07.2010 Ex. CW1/12.
iv The original postal receipt, envelope, courier and tracking report
Ex.CW1/13 to CW1/22
v Present complainant is Ex. C1.
4 DEFENCE PLEA OF ACCUSED
Statement of accused was recorded on 23.09.2013 wherein accused in his defence stated that he has not received any legal notice from the complainant and had only received the summons from the court. He also stated that the cheques in question were stolen from his office and he has been falsely implicated by the complainant to make for his losses. He has not examined any witness in his defence despite being preferred for the same in his statement.
5 RELEVANT LAW
138. Dishonour of of cheque for insufficiency, etc. of funds in the CC No. 09/2/13 3 of 16 account 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 provision of this Act, be punished with imprisonment for [ a terms which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both :
Provided that nothing contained in this section shall apply unless
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid' and.
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.
Explanation - For the purposes of this section, " debt or other liability" means CC No. 09/2/13 4 of 16 a legally enforceable debt or other liability.
139. Presumption in favour of holder It shall be presumed, unless the contrary is proved, 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.
Sec. 43 of NI Act interalia provides that a negotiable instrument drawn, accepted, etc. without consideration or for a consideration which fails creates no obligation of payment between the parties to the transaction.
The ingredients to prove the commission of offence under Sec. 138 NI Act have been laid down in Jugesh Sehgal Vs. Shamsher Singh Gogi 2009 (9) SCALE 455. The relevant portion of the said judgment reads as under:
"9. It is manifest that to constitute an offence under Section 138 of the Act, the following ingredients are required to be fulfilled:
(i) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account;
(ii) The cheque should have been issued for the discharge, in whole or in part, of any debt or other liability;
(iii) that cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
CC No. 09/2/13 5 of 16
(iv) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
(v) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt ofar the said notice"
On burden of proof in cases under NI Act From reading of below quoted paragraphs No. 4 to 9 and 20 of Hon'ble Supreme Court in Vijay Vs Laxman 2013 (1) RCR Cr 1028, the following legal ratio emerges with regard to burden of proof in matters under NI Act.
i. The prosecution has to prove beyond reasonable doubt that cheque was issued by the accused duly signed by him but this burden is lightened by presumption under Sec. 118 and 139 NI Act. Hence, the complainant has only to make an averment that cheque was issued by accused to complainant for lawful consideration.
ii. Thereafter, the burden shifts on the accused to show that the cheque was not issued in lieu of legally enforceable debt or liability but was issued by way of CC No. 09/2/13 6 of 16 security or any other reason on account of some business transaction or was obtained unlawfully.
iii. However, accused can rebut this presumption or discharge his burden by showing a probable defence or preponderance of probability raising genuine doubt that no legally enforceable debt or liability exists.
iv. Accused can discharge this burden either from circumstances appearing in the case or the evidence adduced by the complainant or accused in his defence.
v. On reading of definition of word proved or disproved in Sec. 3 of Evidence Act with Sec. 139 NI Act 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 the circumstances of the particular case, to act upon the supposition that the consideration does not exist.
Above said law is quoted in paragraphs No. 4 to 9 and 20 of Hon'ble Supreme Court in Vijay Vs Laxman and another 2013 (1) RCR Cr 1028.
Above said observations were also made by Hon'ble Supreme Court in Kamala S Vs Vidhyadharan MJ 2007 (3) RCR (Cr) 865 and M/s. Kumar Exports Vs M/s Sharma Carpets 2008 (16) SCALE 372 Paras 9 to 12.
On service of legal notice in cases under NI Act In this respect it has been provided in the case titled as C.C. Alavi Haji Vs Palapetty Muhammed and Anothers (2007) 6 SCC 555 that the entire purpose of service of legal notice to the accused under Sec. 138 NI Act is to give an CC No. 09/2/13 7 of 16 opportunity to the drawer to pay the cheque amount within 15 days of the service of legal notice and thereby free himself from the penal consequences. It conceives cases where a wellintentioned drawer may not have made necessary arrangements for reasons beyond his control to honour the cheque drawn by him and hence this opportunity has been provided. Hence, this provision is meant to protect honest drawers whose cheque may have been dishonoured for the fault of others or who may have genuinely wanted to fulfill their promise but on account of inadvertence or negligence failed to make necessary arrangements for the payment of the cheque. Hence, any honest 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 under Sec. 138 NI Act, make payment of the cheuqe amount and submit to the court that he has made payment within 15 days of receipt of summons (by receiving a copy of the plaint with the summons) and, therefore, the complaint is liable to be rejected. Where a legal notice is sent under registered cover with proper address and stamp and sent along with the summons and complaint, then if it is contended that legal notice was not received only with a view to cheat the complainant, and such offer of payment was not made within 15 days of receipt of summons, then such dishonest drawer can not contend improper service of the notice by virtue of applicability of presumption under Sec. 27 GC Act and 114 Evidence Act.
Hence, the accused by a preponderance of probability has to prove the following :
1 That the cheque was issued as security or for any business transaction CC No. 09/2/13 8 of 16 and there is no legally enforceable debt or liability because the said security is no more enforceable or the debt or liability has been paid.
2 That the cheque was taken unlawfully and wrongfully. 3 That the debt or liability does not remain legally enforceable due to any other reason.
In the present case defence of the accused is that there is no legally enforceable debt against the cheques given by the accused to the complainant no loan was extended as per their implied contract.
6 ARGUMENTS HEARD AND DEALT WITH I have heard the submissions of both the Ld. Counsel for the complainant as well as the accused and perused the relevant record. 7 Let us now examine whether the complainant has proved the necessary ingredients of the offence under Section 138 of the Act or not. 7.1 The first ingredient of the offence stands proved as original cheques are placed on record as Ex. CW1/6, CW1/8 and CW1/10 and issuance of same is admitted by the accused in his defence plea, and also through out the trial as well as his statement u/s 313 Cr.P.C. It is settled law that a signed cheque by the account holder is a complete instrument and the rest of the portions of the cheque can be filled by the complainant. Hence it is clear that that the accused has signed the cheque in question. Hence this ingredient stands proved. 7.2 The second ingredient of the offence is that the cheque must have been issued in discharge of legal liability. As the issuance of all the cheques in question are admitted, the presumptions raised under Section 139 of the Act become CC No. 09/2/13 9 of 16 applicable and the issuance of cheque in discharge of the legal liability stands proved. The law on this point has been succinctly laid down by the Hon'ble Apex Court in Rangappa v. Sri Mohan AIR 2010 SC 1898.
In view of the aforesaid law, the presumption under Sec. 139 NI Act works in favour of the complainant once he files the necessary documents like the dishonored cheques, returning memo, legal notice and delivery proof and avers that the cheques were issued for legally enforceable debt or liability which the accused has failed to pay despite expiry of 15 days of the delivery of legal notice. In fact not only the presumption works in favour of the complainant but he has also proved even otherwise that the cheques in question were issued to him for a legal consideration or legally recoverable debt or liability. In support of the same the complainant has proved Ex. CW1/2 and Ex. CW1/3 which are the invoices regarding the products supplied to the accused and also he has proved the details of the serial number of the goods supplied vide these bills dated 7.5.2010, 24.05.2010 , 31.5.2010 and 18.05.2010. Hence, I give the finding in favour of the complainant that he received the cheques from the accused for a valid consideration. Hence this ingredient stands proved. 7.3 The third ingredient of the offence is that cheque must be presented to the bank within a period of six months from the date mentioned on it. The cheques are Ex. CW1/6, CW1/8 and CW1/10 were returned back unpaid on 26.06.2010 and 06.07.2010 and the cheques are dated 07.06.2010, 28.06.2010 and 29.06.2010. So it is evident that it was presented for payment within the statutory period of six CC No. 09/2/13 10 of 16 months. Hence this ingredient stands proved.
7.4 The fourth ingredient of the offence is that the cheque(s) must be returned unpaid. The cheque were returned unpaid for the reason " Funds Insufficient. The original bank returnmemos Ex. CW1/7, CW1/9 and CW1/11 placed on record proves dishonour of cheques by virtue of presumption raised under Section 146 of the Act and during the trial, Ex. CW1/7, CW1/9 and CW1/11 went uncontroverted. Hence this ingredient stands proved.
7.5 The fifth ingredient of the offence is that the demand notice must be issued to the accused within 30 days of the intimation of dishonour of cheque and same be served upon the accused. Accused has denied the receipt of legal notice Ex. CW1/12. In view of Judgment of CC. Alavi Haji (Supra) this point can not be raised any more by the accused. If the accused had not received the legal notice, then he could have offered the payment within 15 days from the receipt of the summons in view of my aforesaid findings in the second ingredient that cheque was issued in discharge of legal liability. Hence this ingredient stands proved. 7.6 The last ingredient is that the accused must not have made the payment of the cheque amount within fifteen days of the receipt of legal notice. During the evidence, the accused has clearly admitted that because he does not owe anything to the complainant hence he did not make the payment of cheque amount. Hence this ingredient stands proved.
8 Now, I will discuss the arguments of the accused and deal with them simultaneously. Accused has raised various pleas through his counsel LAC Fahim CC No. 09/2/13 11 of 16 Alam to show that he has been falsely implicated and cheques were in the possession of the complainant wrongfully and that they were not issued to the complainant for any legal consideration. This discussion is as follows:
(i) It is submitted that the cheques were stolen regarding which complaints were made and said complaints have been filed on the record. It is also submitted that the accused did not receive any legal notice and he did not place any purchase order with the complainant.
However, all these arguments are nothing but a shot in a dark. The accused has not proved any such complaint made by exhibiting them in his own defence evidence or confronting them in the cross examination of the complainant. As far as non receipt of legal notice is concerned the same has already been dealt in point No. 7.5. Further, as far as non placing of any purchase order is concerned, it is settled law a contract can be express of implied and purchase order can be given orally. Even otherwise the complainant has proved the bills Ex. CW1/2 and Ex. CW1/3 raised on the accused, which reveal the TIN number of the seller for the purpose of calculation of VAT to be paid by the purchaser.
(ii) It is further stated that the complainant has not cited the Office Boy as witness who is alleged to have received the cheques as stated by the complainant.
In this regard it is again observed that this arguments is nothing but a shot in the dark as the accused could have filed an application u/s 254 Cr.P.C or 311 Cr.P.C to summon such Office Boy. However, due to the CC No. 09/2/13 12 of 16 overwhelming weight of the evidence in favour of the complainant who has proved the bills even though the presumption u/s 139 NI Act is in his favour, I do not think that this would tilt the scales in favour of the accused.
(iii) The accused has raised one more hopeless arguments that the complainant has not proved any stock register to show that the goods were supplied to him.
However, in my view the complainant has proved the bills wherein the VAT has also been calculated and the same have been raised against the accused regarding which the cheques in questions were issued. The accused has not challenged these bills and hence, there is no need to bring any stock register on part of the complainant and it is proved beyond shadow of doubt that the cheques in question were issued for a valid consideration. DECISION
9. In view of the aforesaid the accused is convicted for the offence under Sec. 138 NI Act and he be separately heard on the point of sentence.
Announced in the open (ASHOK KUMAR)
Court on 17.04.2015 MM07, SOUTH EAST, SAKET
COURTS, NEW DELHI
CC No. 09/2/13 13 of 16
IN THE COURT OF SH. ASHOK KUMAR, MM07,
SOUTH EAST, SAKET COURTS, NEW DELHI
CC No. 09/2/13
U/S 138 NI Act
M/s Tirupati Enterprises
Versus
Ramesh Kumar Sharma,
17.04.2015
ORDER ON POINT OF SENTENCE
Present : Complainant in person.
Accused produced from J/C.
Sh. Fahim Alam, LAC for accused.
Vide separate judgement, the accused is convicted for commission of offence under Sec. 138 NI Act for nonpayment of 3 cheques amounting to Rs. 4,12,875/ in total vide separate judgement of even date.
It is stated by the convict that he is in J/C since 23.09.2013. It is pertinent to note that on 7.10.2014, the file was taken up pursuant to the circular of CMM, accused appeared before the court and while the Ld. MM intimated the accused that he was entitled to be released on bail u/s 436 A Cr.P.C, the accused CC No. 09/2/13 14 of 16 refused to furnish personal bond and hence it was ordered that the accused be kept in J/c but was at liberty to furnish personal bond in future which he did not furnish till date. The convict has a family consisting of wife and minor son, It is stated that a lenient view may be taken against the convict while imposing the sentence and convict be not sentenced to imprisonment.
In view of the fact that the matter is pending since year 2010 and is more than 4 years old, conduct of the accused is also responsible for the delay in trial as when summons were issued the report came of 'left without address' as recorded in order dated 09.03.2011, on 06.06.2011 entered appearance through counsel, accused sought opportunity for settlement on 15.07.2011 and sought various opportunity for filing the application u/s 145(2) NI Act. Also keeping in view the fact that the cases under Sec. 138 NI Act are unduly clogging the dockets of the courts leading to docket explosion and extraction of judicial time which could have been given to other cases and on the other hand due to the dishonest issuance of cheque, the same is eroding of credibility of such instruments, this court does not deem it necessary to extend the benefit of Probation of Offender Act to the accused. Such dishonest conduct leads not only to docket explosion which needs to be tackled with a heavy hand but also has resulted in harassment of the complainant holding up the valuable money belonging to him.
In view of the aforesaid, the convict is directed to suffer simple imprisonment of 2 years and fine of Rs. 4,22,000/ alongwith 9% interest since the date of dishonour of cheque all of which is directed to be paid as compensation CC No. 09/2/13 15 of 16 to the complainant and in absence of payment of the same, the convict shall suffer simple imprisonment for 9 months. However, benefit of period undergone in J/C shall be given to accused. Copy of judgement and order on sentence be given to the convict.
Announced in the open (ASHOK KUMAR)
Court on 17.04.2015 MM07, SOUTH EAST, SAKET
COURTS, NEW DELHI
CC No. 09/2/13 16 of 16