Delhi District Court
Cc Ni Act.4346/2021 Sanjay Kumar vs . Mahesh Chaat Corner Page No. 1 on 3 April, 2023
CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 1
IN THE COURT OF SH. RAGHAV SHARMA,
METROPOLITAN MAGISTRATE (NI ACT) DIGITAL COURT03,
SOUTHEAST DISTRICT, SAKET COURT COMPLEX, NEW DELHI
Criminal Complaint No.: 4346 OF 2021
SANJAY KUMAR ... Complainant
Versus
RAM MAHESH KASHYAP ... Accused
1. Name & address of complainant : Sanjay Kumar
S/o Sh. Dharam Pal,
R/o 70E/6, Gali No. 2,
AmritpuriB, Garhi,
East of Kailash,
New Delhi110065.
2. Name & address of the accused : Ram Mahesh Kashyap,
S/o Sh. Yaad Ram,
R/o H. No. 5/568, Dakshinpuri
Extn., Dr. Ambedkar Nagar,
Pushpa Bhawan, New Delhi62.
3. Offence complained of : U/S 138, The Negotiable
Instruments Act,1881.
4. Plea of accused : Pleaded not guilty.
5. Date of Institution of case : 13.04.2021
6. Date of notice framed u/s 251 Cr.PC: 23.08.2022
7. Final Arguments : 28.03.2023
8. Date of decision of the case : 03.04.2023
Digitally signed
by RAGHAV
RAGHAV SHARMA
Date:
SHARMA 2023.04.03
16:33:55
+0530
CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 2
1. Vide this judgement, I shall disposed the present complaint under section 138 Negotiable Instruments Act, 1881 (herein referred to as NI Act) filed by Shri Sanjay Kumar (herein referred to as the 'complainant') against Shri Ram Mahesh Kashyap (herein referred to as the 'accused').
2. Factual Matrix: The case of the complainant is that the accused and complainant were having friendly terms with each other since last many years. Accused had approached the complainant in the month of September, 2020 for seeking friendly loan amounting to Rs.1,50,000/ for a period of 2 months. The accused had promised to pay interest of 1.5% per month to the complainant. The complainant had given the loan amount of Rs.1,50,000/ to the accused. Both the parties had executed a Loan Agreement and Promisory Note in this respect. At the time of taking the loan the accused had issued the impugned cheque bearing no. 000025 dated 12.11.2020 for sum of Rs.1,50,000/ on HDFC Bank, Greater Kailash, New Delhi. After two months when the the complainatn asked the accused to returned the loan amount, he sought some more time for the same. After passage of another two months when the complainant asked the accused to returned loan amount, he asked him to present the cheque. Upon the presentatin of the cheque, the same got dishonored vide memo dated 17.02.2021. Thereafter, Legal Demand Notice dated 26.02.2021 was sent to the accused demanding payment of cheque amount within 15 days. Despite the service of notice, the accused failed to pay the loan amount. Henc, being aggrieved, the complainant filed the present complaint u/s 138 of NI Act on 13.04.2021 and prayed that the accused be tried and punished u/s 138 NI Act.
3. Summoning of accused: On issuance of summons, accused entered appearance in the present matter for the first time on 26.11.2021 and was admitted to bail on the same day. Notice under Section 251 Cr.P.C. was framed upon the accused on 23.08.2022, to which he pleaded not guilty and claimed trial. His plea of defence was also recorded. His defence was that the cheque in question bears his signatures. He had taken only Rs.1,00,000/ from the complainant and had already returned Rs.97,000/ to him. He further said that he is only liable for payment of Rs.23,000/ to the complainant and not for the cheque amount. He is stated that the present cheque was issued as a security.
Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:35:39 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 3 EVIDENCE:
4. In order to support his case, the complainant had stepped into the witness box as his own witness and tendered his evidence by way of affidavit which is already on record bearing signature at point A into evidence wherein averments made in the complaint were reiterated. He also relied upon various documents such as:
1. Copy of Agreement as Ex CW1/1;
2. Original Cheque as Ex. CW1/2;
3. Return memo as Ex. CW1/3;
4. Legal demand notice as Ex. CW1/4;
5. Postal receipts as Ex. CW1/5 & Ex.CW1/6;
6. Tracking reports as Ex. CW1/7 & Ex.CW1/8;
The complainant as CW1 was duly crossexamined at length by the ld. Counsel for the accused.
5. Thereafter, the matter was fixed for statement of accused u/s 313 Cr.PC which was recorded wherein the accused stated that he does not wish to lead his defence evidence. Therefore the matter was fixed for final arguments.
6. Final arguments have been heard at length on behalf of both the parties.
APPLICABLE LAW:
7. Before appreciating the facts of the case in detail for the purpose of decision, let relevant position of law be discussed.
Now, Section 138 Negotiable Instrument Act provides as under:
Section 138. Dishonour of cheque for insufficiency, etc., of funds in the 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 Digitally signed by RAGHAV RAGHAV SHARMA Date:
SHARMA 2023.04.03 16:37:21 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 4 returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may be extended to two years, or with fine which 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 (reduced to three months vide notification no. RBI/201112/251, DBOD AMLBCNo. 47/19.01.006 2011/12,dated 04.11.2011) 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 a legally enforceable debt or other liability.
It is well settled position of law that to constitute an offence under S.138 N.I. Act, the following ingredients are required to be fulfilled: (1) drawing of the cheque by a person on an account maintained by him with a banker, for payment to another person from out of that account for discharge in whole/part any debt or liability; (2) cheque has been presented to the bank within a period of six months (now three months) from the date on which it is drawn or within the period of its validity whichever is earlier; (3) returning the cheque unpaid by the drawee bank for want of sufficient funds to the credit of the drawer or any arrangement with the banker to pay the sum covered by the cheque, (4) giving notice in writing to the drawer of the cheque within 30 days of the receipt of information by the payee from the bank regarding the return of the cheque as unpaid demanding payment of the cheque amount, (5) failure of the drawer to make payment to the payee or the holder in due course of the cheque, of the amount covered by the cheque within 15 days of the receipt of the notice.
Being cumulative, it is only when all the aforementioned ingredients are satisfied that the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the N I Act.
The Act raises two presumptions in favour of the holder of the cheque i.e. Complainant in the present case; firstly, in regard to the passing of consideration as contained in Section 118 (a) therein and, secondly, a presumption under Section 139, that the holder of cheque receiving the same of the nature referred to in Section 138 for discharge, in whole or in part, of any debt or other liability.
Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:37:48 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 5 Analysing all the concerned provisions of law and various pronouncements in this regard, the Hon'ble Apex Court in Basalingappa v. Mudibasappa, AIR 2019 SC 1983, noted at para 23 as follows [Bharat Barrel and Drum Manufacturing Company v. Amin Chand Pyarelal, (1999) 3 SCC 35; M.S. Narayana Menon alias Mani v. State of Kerala and another, (2006) 6 SCC 39; Krishna Janardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54; Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513; Rangappa v. Sri Mohan, (2010) 11 SCC 441 referred]:
(i) Once the execution of cheque is admitted, Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
(iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposes an evidentiary burden and not a persuasive burden.
(v) It is not necessary for the accused to come in the witness box to support his defence.
To put in nutshell, the law regarding the presumption for the offence under Section 138 N.I. Act,is that the presumptions under Sections 118(a) and 139 have to be compulsorily raised as soon as execution of cheque by the accused is admitted or proved by the complainant and thereafter burden is shifted upon the accused to prove otherwise. These presumptions shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability etc. The onus to prove the issuance of the cheque lies upon the complainant, and the same has to be proved beyond reasonable doubt, unless the accused admits the same. Once the issuance of cheque is established, either by admission or by positive evidence, the presumption under Section 139 of the Negotiable Instruments Act, 1881 arises. We can summarize the general principles in the following way:
Onus of proof: Section 139 of the Negotiable Instruments Act, 1881 states that 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. Therefore, here the onus shifts upon the accused to prove the nonexistence of debt or other liability. Section 139 Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:38:06 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 6 of the N.I. Act uses the word "shall presume", which means that the presumption under Section 139 is rebuttable.
Standard of proof: The standard of proof required to rebut the presumption under Section 139 is that of "preponderance of probabilities". Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or other liability, the onus shifts back to the complainant to prove by way of evidence, beyond reasonable doubt, that the cheque in question was issued by the accused in discharge, whole or in part, of any debt or other liability, and now the presumptions under Section 118 (a) and Section 139 will not come to the aid of the complainant.
Mode of Proof: The accused may adduce direct evidence to prove that the cheque in question was not supported by consideration, and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should prove the nonexistence of the consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated. At the same time, it is clear that a bare denial of passing of consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant. To disprove the presumptions, the accused should bring on record such facts and circumstances upon the consideration of which, the Court may either believe that the consideration and debt did not exist, or their nonexistence was so probable that a prudent man would, under circumstances of the case, act upon the plea that they did not exist.
As discussed above, from the legal provisions and the law laid down in various judgments, it can be safely gathered that it is for the accused to rebut the presumptions. He can do so by cross examining the complainant, leading defence evidence, thereby demolishing the case of the complainant. It is amply clear that the accused does not need to discharge his or her liability beyond the shadow of reasonable doubt. He just needs to create holes in the case set out by the complainant. Accused can say that the version brought forth by the complainant is inherently unbelievable and therefore the prosecution cannot stand. In this situation the accused has nothing to do except to point inherent inconsistency in the version of the complainant or the accused can give his version of the story and say that on the basis of his version the story of the complainant cannot be believed.
ARGUMENTS AND APPRECIATION OF EVIDENCE:
8. Ld. Counsel for the complainant has argued that all the requirements of Section 138 NI Act have been met in the present case and hence, the accused be convicted. I have heard the arguments and also gone through the record with due circumspection.
Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:38:33 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 7
9. In the case at hand, Ld. Counsel for the complainant has submitted that the accused has put his signatures on the cheque in the present case, thus, the presumptions under Section 118 (a) read with Section 139 of NI Act about the cheque in question having been issued for consideration and in discharge of legal liability should arise in favour of the complainant. On the contrary, Ld. Counsel for the accused has submitted that the accused has sufficiently dislodged the presumption raised against the accused by cross examining the complainant by showing the improbabilities and inconsistencies in his evidence. Therefore, presumption under S. 139 of NI Act, stands rebutted.
10. In the present case, the accused has not denied the signature on the cheque bearing no. 000025 (Ex.CW1/2), thus, the factum of the signature on the cheque has been acknowledged.
11. It is pertinent to mention here that S. 139 only raises the presumption on fulfillment of its condition that the cheque was issued for discharge of in whole or in part any debt or other liability but there is no presumption as to the existence of the debt or liability as such.
"In Rangappa (supra) it has been held that :
Existence of legally recoverable debt is not a matter of presumption under Section 139 of the Act. It merely raises a presumption in favour of a holder of the cheque that the same has been issued for discharge of any debt or other liability".
12. As regards legal notice, the receipt of the same has been denied by the accused. The accused in his statement u/s 313 Cr.PC as well as in his defence u/s 251 Cr.PC dated 09.02.2023 and 23.08.2022 respectively, had stated that he had not received the legal notice as the address mentioned on it is not his correct address. It is interesting to note here that the NBWs issued against the accused on the same address were returned on two occassions with the statement of the son of the accused and the wife of the accused who have categorically mentioned therein that the accused was not at home and had gone somewhere. Nowhere in their statement Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:38:50 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 8 they have stated that the address did not belong to the accused. Even while cross examining the complainant the accused did not question the complainant on sending the legal demand notice on incorrect address. Without there being any suggestion put to the complainant in his cross examination, it cannot be said that the accused has challenged that the legal demand notice was sent at incorrect address. Merely making a statement at the time of framing of notice that the address mentioned on legal demand notice is incorrect would not prove that the legal demand notice was sent at incorrect address. Without there being any proof or raising any doubt through cross examination regarding the address of the accused, it cannot be said that the address was incorrect. In light of these observations the legal demand notice shall be deemed to have been sent at the correct address and shall be deemed to have been received by the accused.
13. As regards to the fact of dishonor of the cheque in question, the original return memos Ex. CW1/3 filed by the complainant dated 17.02.2021 clearly shows that the impugned cheques were dishonoured for the reasons "Funds insufficient". The accused at any stage of the trial has not disputed the authenticity of this return memo. Thus, taking into account that dishonour of the cheque is not under question, this fact also stands proved.
14. Thus, the presentation of the cheque in question, its dishonor and service of legal notice have been duly proved by the complainant. Consequently, the complainant has successfully raised the presumption under Section 139 NI Act.
15. Though the presumption under section 139 NI Act is in favour of CW1, it is important to appreciate his evidence. It is the case of the complainant that he had given loan to the accused to tune of Rs. 1,50,000/ at 1.5% per month. He stated that he had friendly relations with the accused and upon his request, as he was facing financial difficulty, the loan was granted to him. It is further the case of complainant that the he and the accused had undergone an agreement Ex. CW1/1 at the time of granting of loan to him. Complainant in his examination in chief has relied on this agreement to prove the loan transaction. The accused in the cross examination of the Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:39:10 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 9 complainant has suggested the complainant that no such agreement was ever executed between the parties. Through this suggestion, the accused had challenged the loan agreement filed by the complainant in his evidence. Since, this document has not been admitted by the accused and rather challenged by him, it was for the complainant to prove the same. Complainant did not examine any witness to this agreement or any person to prove this document. In the absence of any proof of execution of this agreement, the same shall remain not proved. This document Ex. CW1/1 shall have no consequence against the accused or in favour of complainant.
16 Perusal of cross examination of the complainant would show that the accused had denied the execution of promissory note file by the complainant. It is important note here that the promissory note talked about in the cross examination of complainant has not been brought by him in his evidence during his examination in chief. Only because the promissory note has been attached by the complainant in case file and the same has been relied by the accused cannot make it an evidence unless the same has been tendered on oath. This promissory note is not a part of record as the same was not tendered by complainant in his evidence. It shall have no consequence in favour of the complainant or against the accused. Even though, the agreement Ex. CW1/1 and promissory note has not been proved in favour of complainant yet the presumption raised in his favour u/s 139 NI Act does not stand rebutted. The presumption u/s 139 NI Act can be rebutted by the accused either by bringing positive evidence himself or by bringing on surface the inconsistencies, impobabilities and contradictions in the evidence of the complainant. Through the cross examination of the complainant the accused has not been able to do any such thing.
17 The accused while cross examining the complainant suggested him that the accused had taken loan of only Rs. 1 lakhs and that he had returned Rs. 97,000/ to the complainant through Paytm/account transfer and through cash. This suggestion was obviously denied by the complainant. It was further suggested by the accused to the complainant in his cross examination that accused had undertaken to pay Rs.
Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:39:29 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 10 1,000/ as an installment on each date from taking of loan till 4 months. Through these suggestions, the case of the accused can be said to be that he had taken only Rs. 1 lakhs from the complainant and has returned Rs. 97,000/ to him. The accused in his defence u/s 251 Cr.P.C also made the same statement. Since, it was the case of the accused that he had taken only Rs. 1 lakhs from the complainant and had returned Rs. 97,000/ to him, it was for the complainant u/s 102 r/w 106 Indian Evidence Act, 1872 to bring on record evidence for proving the same. The accused by not examining anyone on his behalf to prove his case has failed to discharge his onus of proof. When it is his case that he had returned substantial amount of loan to the complainant, he should have brought some documents or other proof of the same. He did not examine even himself in his defence evidence leave along anyone else on his behalf. The case of the accused is not worthy of belief in the absence of any proof of his story.
22 It is trite that the burden of proof upon a complainant is of standard "beyond reasonable doubt" whereas on accused it is of "preponderance of probability". Accused is not required to bring positive evidence on record to dislodge the presumption raised under section 139 NI Act, he can do the same by creating doubts on the case of complainant by bringing on surface inconsistencies, improbabilities and contradictions in his case. In the present case, as discussed above the accused has not been able to dislodge the presumption raised against him u/s 139 NI Act. He could not bring to the surface any inconsistencies, improbability or doubt in the evidence of the complainant which could dislodge the presumption raised against him. When the presumption raised against him could not be dislodged by accused by creating doubt on the testimony of the complainant, it was for him to discharge is onus of proof by bringing on record some positive evidence to prove his story. While the presumption is raised against him, it was for the accused to dislodged the same. Though, the accused has put forward his defence u/s 251 Cr.P.C.
and had also cross examined the complainant on the same line yet by not bringing on record any evidence or by not examining any witness on his behalf, he failed to Digitally signed by RAGHAV RAGHAV SHARMA SHARMA Date:
2023.04.03 16:40:21 +0530 CC NI Act.4346/2021 Sanjay Kumar Vs. Mahesh Chaat Corner Page No. 11 prove his defence as required by him u/s 102 r/w 106 Indian Evidence Act, 1872. In the absence of rebuttal of presumption raised against accused, the case of the complainant stands on its own legs against him. The complainant has successfully proved his case beyond reasonable doubts against the accused.
DECISION
21. Resultantly, the accused Mr. Ram Mahesh Kashyap is convicted of the alleged offence under section 138 of NI act.
Announced in the open court today on 03.04.2023. This judgment contains 11 pages all are signed by me. A copy of this judgment be placed on the official website of the District Court.
Digitally signed by RAGHAVRAGHAV SHARMA SHARMA Date:
2023.04.03 16:41:31 +0530 Announced in the open court on (Raghav Sharma) this day i.e. 03.04.2023 MM (N.I. ACT)Digital Court03/SED, Saket Courts, New Delhi