Delhi District Court
Vivek Singh vs Hardeep Singh Thapar on 26 September, 2024
IN THE COURT OF JUDICIAL MAGISTRATE FIRST
CLASS, (NEGOTIABLE INSTRUMENT ACT)-07, SOUTH,
SAKET COURTS, NEW DELHI
Presided over by: SH. RISHABH TANWAR
CT Cases 461205/2016
Vivek Singh Vs. Hardeep Singh Thapar
A. CNR No. : DLST020000262016
B. Date of Institution : 04.06.2016
C. Date of commission of : 24.05.2016
offence
D. Name of the complainant : Sh. Vivek Singh
S/o Late Sh. Surender Singh
R/o H.No. D-116, Defence Colony,
New Delhi.
E. Name of the accused, his : Sh. Hardeep Singh Thapar
parentage and address
S/o Late Sh. K.S. Thapar,
R/o H.No. B-4/1001, Aloha
Apartments, Sector 57, Gurgaon,
Haryana-122011.
Offence complained of : Under section 138 Negotiable
Instruments Act, 1881
G. Plea of the accused : Pleaded not guilty and claimed trial.
H. Judgment reserved on : 09.09.2024
I. Date of Judgment : 26.09.2024
J. Final Order : ACQUITTAL
CT Cases 461205/2016
Vivek Singh Vs. Hardeep Singh Thapar Page 1 of 29
Digitally
signed by
RISHABH
RISHABH TANWAR
TANWAR Date:
2024.09.26
14:51:34
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BRIEF FACTS OF THE CASE: -
1. The instant matter has originated out of a complaint under Section 138 Negotiable Instruments Act (hereinafter referred to as 'NI Act'), filed by the complainant namely Sh. Vivek Singh against the accused Sh. Hardeep Singh Thapar, alleging that cheques bearing no. 069402, dt. 14.04.2016 for Rs.80,00,000/-, drawn on Axis Bank Ltd., Sector-49, Gurgaon, Haryana Branch, was issued by the accused in favour of the complainant in discharge of a legal liability. The above-mentioned cheque has been dishonored and the accused has not paid the said amount even after receiving the prescribed legal demand notice dated 09.05.2016. By virtue of this judgment, the present complaint is being disposed of.
2. It is the case of the complainant he is a practicing advocate before Hon'ble Delhi High Court and Supreme Court of India and the accused was carrying business activities of real estate broker, promoter, developer and builders in name and style of "M/s. Thapar Associates" and constructed a building known as "Thapar Arcade". It is further the case of complainant that accused approached complainant, who was in requirement of property and the accused represented for himself and on behalf of owners (viz. S. Jitender Singh Arora and Smt. Charanjeet Kaur Arora) of two flats in building located at Plot no. 47B, Kalu Sarai, New Delhi, who were desirous to sell their respective floors at 1st and 2nd with 4 car parking spaces in the basement of the said building. It is further the case of complainant that on such representation by accused for himself CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 2 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:51:41 +0530 and on behalf of the abovesaid owners, complainant agreed to purchase the aforesaid floors from their respective owners and sale deeds got executed and registered with office of Jurisdictional Sub-Registrar vide registration no.3489 and vide registration no.3488, both on 20.06.2015. It is further the case of complainant that accused being real estate broker, promoter and developer had obtained cash credit facilities on current account no. 62003254882 and term loan facilities on account no. 62003265555 maintained with State Bank of Hyderabad, Nehru Place Branch by mortgaging the said building located at Plot No.47B, Kallu Sarai, New Delhi. It is further the case of complainant that accused initiated process of settlement of outstanding dues with State Bank of Hyderabad for an amount of Rs.1,80,00,000/- , however accused informed complainant that accused was falling short of funds to the tune of Rs.80,00,000/-, thus complainant in pursuance of constant pleading for help and because of friendly relationship with accused, complainant agreed to offer a loan of Rs.80,00,000/- to save accused from legal proceedings initiated by the above said bank and accordingly, a loan agreement dt. 13.06.2015 was entered into and in terms of said agreement, accused was required to repay the loan of Rs.80,00,000/- within a period of 6 months from date of execution of the loan agreement along with agreed rate of interest and shall also handover original chain of title deeds related to the said property which were mortgaged with the bank. It is further the case of complainant in terms of the said loan agreement, of accused failed to repay the loan with agreed rate of interest, on such event accused shall CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 3 of 29 Digitally signed by RISHABH TANWAR RISHABH Date:
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execute sale deeds in respect to (a) office space ad-measuring 500 sq. feet located near MTNL Building, New Delhi-110016,
(b) terrace rights admeasuring 200 sq. years in property no.161, Thapar House, Gulmohar Enclave Community Centre, New Delhi and (c) property no.K-17, Hauz Khas, New Delhi in favour of complainant, for which complainant reserve its right to approach appropriate court for enforcement of said loan agreement. It is further the case of complainant after expiry of 6 months, complainant presented cheque bearing no. 069402, dt. 14.04.2016 for Rs.80,00,000/-, drawn on Axis Bank Ltd., Sector-49, Gurgaon, Haryana Branch. Thereafter when complainant presented the aforementioned cheque, the same got returned dishonored with remarks "insufficient funds" vide dishonor memo dated 16.04.2016. Thereafter, the complainant sent the statutory legal notice dated 02.05.2016 to the accused through speed post. Consequently, the present complaint was filed against the accused as the accused had failed to pay the same within the prescribed statutory period of 15 days.
3. The complainant entered the witness box and examined himself as CW-1 on 04.06.2016. He tendered his evidence by way of affidavit in his pre-summoning evidence affidavit as Ex. CW- 1/A bearing his signatures at point A and B. He further relied upon the documents namely:
a. The agreement dt. 13.06.2015 Mark A, b. The original cheque in question Ex.CW1/1, c. The cheque Return Memo dt. 16.04.2016 Ex.CW1/2, d. The office copy of legal notice dt. 02.05.2016 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 4 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:51:49 +0530 Ex.CW1/3, e. The postal receipt dt. 02.05.2016 Ex.CW1/4, f. The tracking report Ex.CW1/5 respectively.
4. Summons were issued against the accused vide order dated 04.06.2016. The accused made his first appearance before the Court on 23.07.2018 for cancellation of NBWs issued against him vide order dt. 28.04.2018 wherein he was admitted to bail. Notice u/s. 251 Criminal Procedure Code, 1973 (hereinafter referred to as "CrPC") was framed against the accused on 22.11.2019 wherein he pleaded not guilty and further stated that he did not receive any legal demand notice. He further stated that he had issued the said cheque in question by way of security to the complainant. He further stated that he entered into a transaction with the complainant wherein a property bearing no.47B, Kalu Sarai, New Delhi-16, 1st, 2nd, 3rd and 4th floor was to be sold to the complainant. He further stated that the said property was in the name of J.S. Arora and his family members. He further stated that the complainant had given earnest money to J.S. Arora, originally the property was in his name, and he had sold it to J.S. Arora and later J.S. Arora wanted to sell it to someone else. He further stated that the complainant was willing to buy the property, and he gave the cheque in question by way of security to the complainant till the time the sale deed was executed. He further stated that the sale deed was executed by Mr. J.S. Arora and himself and the property was now transferred to the complainant. He further stated that he requested the complainant to return his security CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 5 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:51:53 +0530 cheque, but the complainant had misused the same and has filed the present complaint.
5. Complainant again entered the witness box and examined himself as CW-1 on 12.09.2022 and adopted his pre-
summoning evidence as post summoning evidence. CW-1 was duly cross-examined wherein he stated that he was a lawyer by profession. He further stated that he was a practicing lawyer before Delhi High Court and Delhi District Court. He further stated that he had no license for money lending to any persons. He further stated that he had documentary proof for withdrawing Rs.80,00,00/- from his bank account. He further stated that he had not brought the same and he can produce the said document as and when required. He was further cross- examined on 10.11.2022 wherein he stated that he was an income tax payee, and he regularly files his ITR. He was asked whether he had shown in his ITR about payment of Rs 80 lac loan to the accused to which he stated that he was protected by the Judgment "P Rasiya Vs. Abdul Naseer" as according to the judgment it is not required to disclose the source of fund. He denied the suggestion that he had not given any loan amount of Rs 80 lac to Mr. H.S. Thapar, the accused herein. He further stated that he met the accused in the year 2014 through a common friend namely Mr. Satender Kumar. He further stated he did not know what the profession of Mr. Satender Kumar was (who was his friend also) in the year 2014. He voluntarily stated that he was guarantor in the loan agreement dated 13.06.2015. He further stated that he met with the accused for CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 6 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:51:59 +0530 the first time and heard that he was dealing in property and Mr. Satender told him that the accused had some property, and he may buy that. Mr. Satender Kumar and the accused jointly showed him property No 47B, Kalu Sarai, New Delhi, which consisted of four floors. He further stated that when he intended to purchase the said property, he came to know that the property was mortgaged for some loan by the accused. He further stated that he purchased the property only after the payment of loan to State Bank of Hyderabad. He further stated that the amount of Rs.1,00,00,000/- was paid by the accused to the bank and balance of Rs 80,00,000/- was deposited by him on behalf of accused in cash before State Bank of Hyderabad on 15.06. 2015. He further stated that consequently, the N.O.C. was issued by the bank in favour of the accused. He voluntarily stated that the bank has not released the original documents of said property till date, because the bank stated that there was another loan pending against the accused. He was further asked to show any document with regard to authorization by the accused for payment of loan to State Bank of Hyderabad to which he stated that no such authorization was required as the accused was accompanying him in the Nehru Place Branch of the bank. He was further asked to the original receipt of payment of Rs 80 lac to the bank to which he stated that he was carrying the color photocopy of the cash deposit receipt, the same was proved as 'Mark A1'. He further stated that that day, the said property of Kalu Sarai was on rent and he was collecting the rent from the tenant, who was tenant on First, second and third floor and the said property was registered in CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 7 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:04 +0530 his name on 20.06.2015 by Mr. Arora and his family. He admitted that the above-mentioned property of Kalu Sarai was purchased by him from Mr. Arora through the accused. He admitted that his name was written by him in the cheque which was required by the accused. He denied the suggestion that the accused did not instruct him to do so as the said cheque was a security cheque for the sale dee of the property. He denied all other suggestions put to him.
6. Vide order dt. 20.04.2016, The complainant's evidence (CE) was closed.
7. The statement of accused u/s. 313 Cr.P.C was recorded on 31.08.2023 wherein he stated that he had not issued any cheque in discharge if any liability. He further stated in fact he had not any liability towards the complainant. He further stated that the cheque was issued as security for execution of sale deeds by Mr. J.S. Arora and his family members in favour of the complainant and his brother. He further stated that the property was purchased by the complainant through him from Mr. J.S. Arora and his family and the cheque was undated. He further stated that he did not receive any legal notice and it was a false case made by twisting the facts, the complainant never gave him any amount of Rs.80,00,000/-, in fact the complainant became dishonest after getting the sale deeds by the Arora family. He further stated that the complainant became dishonest and instead of returning his cheque filed the blank portions of the cheque, which were not filed in his handwriting, more CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 8 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:09 +0530 specifically the date of the cheque.
8. The accused thereafter examined himself as DW-1 on 04.03.2024 wherein he stated that he had met the complainant through some property dealer somewhere in the year 2014-
2015 and at that time, he was working as a real estate consultant in Delhi NCR. He further stated that when he met the complainant through the property dealer, he got to know that the complainant was in search of property. He further stated that he had arranged for a meeting between one J.S. Arora, who was the owner of Ist, IInd and IIIrd floor of property bearing No. 47/B, Kalu Sarai, consisting of basement, ground, 1st, IInd, IIIrd along with terrace and the whole property was let out to one Narayana Coaching Academy. He further stated that the deal for the property owned by Sh. J.S. Arora with the complainant was finalized for an amount of Rs.3.5 Crores and the complainant gave an earnest amount of Rs.79 lakhs in cash to Sh. JS Arora. He further stated that before finalizing the deal and the execution of necessary documents, the complainant wanted some security from him as well as Sh. JS Arora for the amount that he had paid to Sh. JS Arora. He further stated that in that background, he gave one blank, signed, undated cheque of Rs.80,00,000/- without filling the name of the payee and the sale deed was executed by Sh. JS Arora and the title was transferred in the name of the complainant and his brother. He further stated that the complainant was supposed to return his security cheque, but he did not return it after execution of documents. He further stated that the complainant had misused CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 9 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:14 +0530 the aforesaid security cheque by filling in the name of the payee and date. He further stated that the allegation that the complainant had deposited Rs.80,00,000/- in his bank account was false. He further stated that prior to Mr. J.S. Arora, he was the owner of the aforesaid property, and he had got the construction done. He further stated that he had mortgaged the said property with State Bank of Hyderabad for an amount of Rs.95,00,000/- and the said loan was taken as advance towards the rental amount. He further stated that thereafter, he had been depositing the cheques given by the tenant towards the rent with the aforesaid bank as repayment of the loan. He further stated that when J.S. Arora had purchased the property, he was aware of the mortgage and when the complainant had purchased the aforesaid property, he was also made aware of the mortgage and that original title deeds were lying with the State Bank of Hyderabad. He further stated that he had entered into an onetime settlement (OTS) with the aforesaid bank for an total amount of Rs.1 crore 80 lakhs with respect to aforesaid property as well as another property which was mortgage with the bank and the other property was K-17, Hauz Khas Enclave, New Delhi. He further stated that he had repaid the entire amount to the bank by way of demand draft in the sum of Rs.1 crore and Rs.80 lakhs in cash out of his own resources and that day he had brought the original pay in slip dt. 15.06.2015 for Rs.80 lakhs and the colored photocopy of the same was proved as Ex. DW1/1(OSR). He further stated that he had also brought the original one-time settlement (OTS) offer letter dt. 08.06.2015 copy of which was then proved as Ex. DW1/2 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 10 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:19 +0530 (OSR) (Colly) (2 pages) and the original bank statement dt.
15.06.2015 of the account numbers ending with 4882 and 5555 bearing sign and seal of Chief Manager of the State Bank of Hyderabad. Copy of the same was then proved as Ex.DW1/3 (OSR) and Ex.DW1/4 (OSR) respectively. He further stated that complainant had never paid any such amount of Rs.80 lakhs either to him or in his bank account and the complainant never returned his security cheque and had misused the same for filing the present case even after being in possession of property in Kalu Sarai and receiving rentals from the execution of sale deed in his favour. He further stated that the original sale deed is also in the possession of the complainant.
9. The accusation was duly cross-examined on 20.04.2024 wherein he was shown Ex.CW1/1, cheque in question and asked to identify the signature at point X to which he stated that signature belongs to him. He denied the suggestion that he changes his address at regular intervals in order to evade his creditors. He admitted that the address mentioned in the description on the statement u/s. 313 CrPC and the description mentioned in the examination-in-chief dt. 04.03.2024 are different addresses. He further stated that he was staying on lease at both the addresses and after the expiry of the lease he had to find new accommodation for him. He was thereafter asked to show any document on record wherein the complainant allegedly paid an earnest money of Rs.79,00,000/- to Sh. J.S. Arora (vendee) towards the deal of purchasing the first, second and third floor (with roof rights) of property CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 11 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:25 +0530 bearing No.47/B, Kalu Sarai, New Delhi-110016 to which he stated that there was no such document on record. He further stated that there was no document on record wherein the complainant allegedly demanded a security of Rs.80 lakhs from you, to secure the alleged earnest money of Rs.79 lakhs paid to Sh. J.S. Arora (vendee) towards the deal of purchasing the first, second and third floor (with roof rights) of property bearing No.47/B, Kalu Sarai, New Delhi-110016 by the complainant. He further stated that there was no such document on record such as the agreement/document reflecting issuance of alleged subject security cheque of Rs.80 lakhs by him in favour of the complainant on behalf of Sh. J.S. Arora (vendee) towards the deal of purchasing the first, second and third floor (with roof rights) of property bearing No.47/B, Kalu Sarai, New Delhi- 110016. He was further asked to show any document issued by State Bank of Hyderabad reflecting release of original title deed of subject property No.47/B, Kalu Sarai, New Delhi-110016 to which he stated that he had already brought on record the no- objection certificate given by the State Bank of Hyderabad along with the bank statements. He voluntarily stated that only the first, second and third floor of the property which comprises of a basement, ground, first, second, third floor and fourth floor, belongs to the complainant. The bank could not have given the title deeds of the complete property to the complainant. He admitted that the Bank of Hyderabad has not returned the original title deed of the Subject property to him at the time of issuance of no-objection certificate. He denied the suggestion that the Kalu Sarai property deal was between J.S. Arora CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 12 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:30 +0530 (vendor) and the complainant (vendee), there was no occasion for him to issue a security cheque of Rs.80 lakhs to the complainant on behalf of J.S. Arora and his family. He voluntarily stated that since he was the broker between the complainant and Sh. J.S. Arora after selling the entire property to Sh. J.S. Arora, the complainant wanted some security as he had paid Rs.79 lakhs in cash to Sh. J.S. Arora as an earnest money. He further stated that it was against that background that he had given the security cheque. He admitted that Sh. J.S. Arora has filed an FIR No.251/2012, PS Malviya Nagar u/s. 420/34 IPC against him for selling the subject property despite the property being mortgaged to State Bank of Hyderabad. He further stated that he has been acquitted in FIR No.66/2008 and admittedt that the remaining two FIR No.476 and FIR No.499/2011 were pending against him. He was further confronted with para No. C of his application u/s.145(2) NI Act from point A to B wherein he had stated that the complainant had paid the entire consideration amount of Rs.2,71,50,000/- directly to the bank account of Mr. Arora and his family by way of RTGS and the complainant started pressurizing the accused for payment of balance amount to the bank and in the process, the accused issued the cheque in question as security. He further asked that he stated that "Since I was the broker between the complainant and SH. J.S. Arora after selling the entire property to Sh. J.S. Arora, the complainant wanted some security as he had paid Rs.79 lakhs in cash to Sh. J.S. Arora as an earnest money. It is against this background that he had given the security cheque" and earlier in his application u/s. 145 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 13 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:34 +0530 (2) NI Act he stated the aforesaid. It was further put to him in that in his statement u/s. 313 CrPC in response to question no.2 he has stated "the cheque was issued for security for execution of sale deed by Mr. J.S. Arora and his family members in favour of the complainant and his brothers". which of the statements is correct to which he stated that according to his, all the statements were correct. He denied all other suggestions put to him.
10.Thereafter vide order dt. 20.04.2024, the accused closed his evidence, and case was put for final argument.
ARGUMENTS ADVANCED ON BEHALF OF THE PARTIES
11.Sh. Joydeep Bhattacharya, Ld. counsels for the complainant have argued that the accused has taken contradictory stands at various stages during the trial. It is also argued that the accused has proved all the necessary ingredients of the offence u/s. 138 NI Act and has prayed that the accused be convicted of the aforesaid offence.
12.Ms. Dipika Jain, Ld. counsel for the accused has argued that the complainant has failed to prove his financial capacity, as he had failed to prove the fact which would have shown that the complainant had the wherewithal of Rs. 80,00,000/- in cash, which the complainant had alleged to have given to the bank on behalf of the accused. Ld. Counsel has lastly prayed that the accused has rebutted the presumption under section 139 NI Act CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 14 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:40 +0530 by raising a probable defense and has prayed that the accused be acquitted in the present complaint. Ld. Counsel has relied upon the following judgments:
. Sri Dattatraya Vs. Sharanappa CA no. 3257 of 2024 arising out of SLP (Crl.) 13179 of 2023. . C. Anthony Vs. K. G. Raghavan Nair Appeal (Crl.) 1748 of 1996 decided on 01.11.2002.
. P. Rasiya Vs. Abdul Nazer C.A. no.s. 1233-1235 of 2022 arising out of SLP (Crl.) Nos. 7430-7432/2022 decided on 12.08.2022.
. Vipul Kumar Gupta Vs. Vipin Gupta Crl.L.P. 461/2011 decided on 24.08.2012 by the Hon'ble Delhi High Court.
POINTS OF DETERMINATION
13.The following points of determination arise in the present case:
A. Whether the complainant has successfully proven the facts which would raise the presumption u/s. 118 r/w Section 139 of NI Act by proving that the cheque in question bears the signature of the accused?
B. If yes, whether the accused has been successful in raising a probable defence?
THE APPLICABLE LAW CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 15 of 29 Digitally signed by RISHABH TANWAR RISHABH Date:
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14.Before appreciating the facts of the case in detail for the purpose of decision, let relevant position of law be discussed first. 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 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 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 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 16 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:52:52 +0530 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 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.
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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.
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.
CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 18 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date: 2024.09.26 14:53:08 +0530 (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 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 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 19 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:13 +0530 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 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 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 20 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:20 +0530 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 CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 21 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:27 +0530 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.
FINDINGS OF THE COURT Points of determination number A:
15.The accused, during the trial, has neither disputed that the cheques in question i.e., Ex. CW-1/1 was drawn on an account maintained by the accused nor that the signature upon the same does not belong to him. Once the signature upon the cheque in question has been admitted by the accused either expressly or impliedly, the presumption u/s. 139 NI Act becomes operative in favour of the complainant. In another words, it is presumed that the holder of a cheque received the cheque of the nature, as mentioned in Section 138 NI Act, for the discharge, in whole or in part, of any debt or other liability.
16.Accordingly, the point of determination number A is decided in the affirmative.
Points of determination number B:
17.Once the presumption is raised, the burden of proof shifts upon the accused to prove otherwise.CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 22 of 29
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18.Coming to the facts of the present case, the pivot of the controversy in the present case is that the complainant alleges that he had paid Rs. 80,00,000/- in the State Bank of Hyderabad, Nehru Place Branch on behalf of the accused towards the One Time Settlement (OTS) entered into by him with the aforementioned bank and towards discharge of this liability, the accused had issued the cheque in question. The complainant has also relied upon the loan agreement (Mark A) executed to bring the financial help in documentary form. The accused on the other hand has taken a defense that he had issued the cheque in question as security, as the instance of the complainant to him, as the complainant had paid Rs.
79,00,000/- in cash to one Jitender Singh Arora towards purchase of a property in Kalu Sarai, for which the accused was the facilitator.
19.In the cross-examination of the complainant by the Ld. Counsel for the accused, he was asked to show the original receipt of payment of Rs. 80,00,000/- to the bank, in response to which he has placed on record a color photocopy of a receipt of deposit of cash of Rs. 80,00,000/- dated 15.06.2015 in the State Bank of Hyderabad, Nehru Place Branch (Mark A1).
20.It is pertinent to note that Mark A1 is a colored photocopy of the original document, thus rendering it to be secondary evidence. The admissibility of secondary evidence is governed by section 65 of Indian Evidence Act, 1872 (hereinafter referred to as "I.E.A." for the sake of brevity) and CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 23 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:38 +0530 corresponding section 60 of Bhartiya Sakshaya Adhiniyam 2023, wherein the former reads:
"65. Cases in which secondary evidence relating to document may be given:
Secondary evidence may be given of the existence, condition or contents of a document in the following cases:
(a)When the original is shown or appears to be in the possession or power of the person against whom the document is sought to be proved, or of any person out of reach of, or not subject to, the process of the Court, or of any person legally bound to produce it, and when, after the notice mentioned in section 66, such person does not produce it;
(b)When the existence, condition or contents of the original have been proved to be admitted in writing by the person against whom it is proved or by his representative in interest;
(c)When the original has been destroyed or lost, or when the party offering evidence of its contents cannot, for any other reason not arising from his own default or neglect, produce it in reasonable time;
(d)When the original is of such a nature as not to be easily movable;
(e)When the original is a public document within the meaning of section 74;CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 24 of 29
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(f)When the original is a document of which a certified copy is permitted by this Act, or by any other law in force in India to be given in evidence;
(g)When the originals consist of numerous accounts or other documents which cannot conveniently be examined in Court, and the fact to be proved is the general result of the whole collection.
In cases (a), (c) and (d), any secondary evidence of the contents of the documents is admissible. In case (b), the written admission is admissible. In case (e) or (f), a certified copy of document, but no other kind of secondary evidence, is admissible. In case (g), evidence may be given as to the general result of the documents by any person who has examined them, and who is skilled in the examination of such documents."
21.Neither of the conditions mentioned in subclauses (a) to (g) of section 65 I.E.A. have been alleged nor proved by the complainant during the trial. He had not even stated that the original was with the accused or that he had lost the time. Besides, if it is the case of the accused that it was a printout taken from a computer, in which case it shall be treated as a computer output and the same should have been supported by a certificate under section 65B I.E.A. However, no such certificate, too, was brought by the complainant. (reliance is placed upon "Arjun Panditrao Khotkar vs Kailash Kushanrao Gorantyal AIR 2020 Supreme Court 4908"
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2024.09.26 14:53:48 +0530 Therefore, the deposit slip (Mark A1), as brought by the complainant in evidence, had remained not proved during the trial by the complainant. It is pertinent to note that while it is true that no such suggestion was given to the complainant in his cross-examination by the Ld. Counsel for the accused, however these questions being a pure question of law, can be considered by this court at this stage. It is also noteworthy that though allegedly the complainant was in possession of this crucial piece of evidence, it was not filed by the complainant along with the complaint.
22.On the contrary, the accused has relied upon the exact same cash deposit slip which was brought by him in his evidence in the original and the copy of the same was compared with the original and exhibited in evidence as Ex. DW-1/1. The accused has stated that he had obtained the No-Objection Certificate from the bank concerned by depositing the amount of Rs. 80,00,000/- in cash himself. It is pertinent to note that no question or even a remote suggestion on the genuineness or veracity of the same was given to the accused in his cross- examination by the Ld. Counsel for the complainant. The genuineness of the Ex. DW-1/1 was not disputed by the complainant during the trial.
23.Moreover, it is pertinent to note that both the complainant and the accused have placed reliance on the same deposit slip. Neither have called the bank witness to prove the identity of person who had deposited the cash in question. Hence, the CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 26 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:53 +0530 presumption would go in favour of the person who had brought the original slip in the court, as the bank concerned would have issued the slip to the person, in the ordinary course of its business, who had deposited the money in the bank. In the present case, it is the accused had brought the original slip (Ex. DW-1/1), hence the presumption would go in his favour. Moreover, the complainant has proved the deposit of Rs. 80,00,000/- by proving his bank account statement which shows the entry dated 15.06.2015 of Rs. 80,00,000/- with the corresponding remark 'cash deposit self'. Therefore, the accused has been able to prove on the scale of preponderance of probabilities that he had deposited the amount of Rs. 80,00,000/- in the State Bank of Hyderabad, Nehru Place Branch. Thus, by implication, the accused has been able to raise a probable suspicion on the statement of the complainant that he had deposited the aforesaid amount.
24.Reverting to the alleged loan agreement (Mark A), which has been relied upon by the complainant, is only a photocopy of the original. The same standards as is discussed in paragraph numbers 10 and 11 apply to this document Mark A as well. The complainant could have proven the attestation of the document by calling at least one attesting witness namely either Pradeep Kumar or Varun Ahlawat, but neither was examined by the complainant. What is more astonishing is that the complainant thought it fit to not even include the aforementioned witnesses in the list of witnesses filed along with the complaint. It is also pertinent to note that no suggestion was given to the accused in CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 27 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:53:58 +0530 his cross-examination that he has executed the loan agreement (Mark A) nor the accused was confronted with the loan agreement to seek his admission with respect to the signatures on the loan agreement. Therefore, document Mark A has remained 'not proved' during trial and cannot be relied upon.
25.The Hon'ble Supreme Court in the case of "Hiten P. Dalal vs Bratindranath Banerjee 2001 (6) SCC 16" had held that "23. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, 'after considering the matters before it, the court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists' [Section 3, Evidence Act]. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the court in support of the defence that the court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'." (Emphasis is of the undersigned).
26.In the considered finding of this court and careful evaluations of the testimony recorded during the trial and the evidence brought on record, I find that the accused has been able to raise a reasonable suspicion on the story of the complainant and has CT Cases 461205/2016 Vivek Singh Vs. Hardeep Singh Thapar Page 28 of 29 Digitally signed by RISHABH RISHABH TANWAR TANWAR Date:
2024.09.26 14:54:03 +0530 been able to prove his defence on the scale of preponderance of probabilities. Consequently, the accused has been able to rebut the presumption under section 139 NI Act. On the other hand, the complainant has miserably failed to prove his case beyond the shadow of reasonable doubt.
27.Accordingly, point of determination no. B is decided in affirmative.
CONCLUSION
28.In view of the aforesaid discussion, the accused Hardeep Singh Thapar S/o Late Dr. K. S. Thapar is hereby held 'not guilty' and accordingly acquitted of the offence under section 138 NI Act.
29.This judgment contains 29 pages. This judgment has been pronounced by the undersigned in the open court and each page bears the signatures of the undersigned.
30.Let a copy of the judgment be uploaded on the official website of District Courts, Saket forthwith.
Digitally
signed by
Announced in the open court RISHABH
RISHABH TANWAR
on this Court on 26th day of September 2024 TANWAR Date:
2024.09.26
14:54:08
+0530
(Rishabh Tanwar)
JMFC (NI Act)-07/South District
Saket District Court
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