Delhi District Court
Desh Raj Thakur vs . Shamsher Singh @ Shera Page 1 Of 17 on 11 November, 2022
IN THE COURT OF SH. ANSHUL SINGHAL,
MM (NI ACT)-03, ROUSE AVENUE COURT COMPLEX,
NEW DELHI DISTRICT, NEW DELHI
In the matter of: CC No.: 14422/2018
CNR NO.: DLND020147222018
Desh Raj Thakur
S/o Sh. Bidhichand Thakur,
R/o H.No.163, Aliganj,
Kotla Mubarkpur,
New Delhi-110003.
......Complainant
versus
Shamsher Singh @ Shera
R/o D-21, B.K.Dutt Colony,
Karbala, Lodhi Road,
New Delhi-110003.
........Accused
JUDGMENT
Date of Institution of Complaint : 17.09.2018 Offence Complained of : u/s. 138 of NI Act Plea of Accused : Not Guilty Date of Final Arguments Heard : 31.10.2022 Decision Qua Accused : Acquittal Date of Decision : 11.11.2022 BRIEF STATEMENT OF REASONS FOR DECISION
1. Vide this judgment, I shall dispose of the present complaint u/s. 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as the NI Act) filed by the complainant against accused on account of dishonour of three cheques, one CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 1 of 17 bearing no. 265117 dated 25.04.2018, second bearing No. 265118 dated 25.05.2018 and third bearing no. 265120 dated 25.06.2018, all for a sum of Rs.25,000/- each and all drawn on Punjab National Bank, Jor Bagh, New Delhi issued by the accused in favour of the complainant (hereinafter referred to as the cheque in question).
2. Brief facts of the case as per the complaint are that in the month of January, 2018 the accused approached the complainant and sought a sum of Rs. 75,000/- for a period of 2 months on account of financial crises, for the marriage of his daughter which was fixed in February, 2018. It is further submitted that the accused regularly approached the complainant for financial help, and considering the request of the accused the complainant had arranged about Rs. 75000/- from his own savings and provided the financial aid/ loan/ help of Rs. 75,000/- to the accused. It is further submitted that accused in March, in order to discharge his liability issued the cheques in question to the complainant towards repayment of loan.
3. It is further stated that however, on presentation of cheque in question the same was returned dishonoured with remarks "Funds Insufficient/ Instrument mutilated" vide cheque return memos dated 24.07.2018, 06.08.2018 & 08.08.2018. That thereafter, a legal notice was sent to the accused dated 21.08.2018 and since no payment was made within 15 days of the service of legal notice, then the present case has been filed.
4. Pre-summoning evidence was concluded on 19.09.2018 and summons were issued to accused on the very same day. The accused entered his appearance on 07.05.2019 and furnished bail CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 2 of 17 bonds on the same day.
5. A notice explaining the accusation to the accused u/s. 138 of N.I.Act was served on 28.05.2019 and his plea was recorded. The accused pleaded not guilty and claimed trial. The accused while admitting to his signatures on the cheque in question and the receipt of legal notice, denied filling the name of the payee and the date on the cheque. The accused took a plea that he had given total four cheques to one Sh. Inderjeet Julka for repayment of a friendly loan of Rs.25,000/-. He has further stated that one of them was for repayment and others were only for security purposes. It is his case that in March 2018, he paid the entire loan back to Sh. Inderjeet Julka after which he returned to him only one cheque and that despite repeated requests he did not return the other three cheques. He has further stated that he does not know how the cheques reached the complainant and that he does not know the complainant at all.
6. An application u/s. 145(2) N.I.Act moved on behalf of the accused was allowed vide order dated 28.05.2022. During complainant's evidence (CE), the complainant has examined himself as CW1, who has relied relied upon his evidence by way of affidavit and has relied on the following documents:-
1. Original Cheques in Question Ex-CW1/1 to Ex-CW1/3
2. Original Bank Return Memos Ex-CW1/4 to Ex-CW1/6
3. Legal Demand Notice Ex-CW1/7
4. Original Speed Post Receipt Ex-CW1/8
5. Proof of Delivery Ex-CW1/9
6. Complaint Ex-CW1/10
7. CW1 was duly cross-examined by counsel for accused and CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 3 of 17 discharged. Since no other witness sought to be examined on behalf of complainant, accordingly, CE was closed vide order dated 24.09.2019.
8. Accused was thereafter examined u/s. 281 r/w. Section 313 CrPC on 15.10.2019, and the entire incriminating evidence was put to him. During statement of the accused u/s 313 CrPC, the accused took a similar stand as taken by him in his plea of defence u/s. 251 CrPC. Accused chose to lead defence evidence (DE) and accordingly, the matter was fixed for 14.11.2019.
9. Accused has examined himself as DW1. Accused has examined his son, Sh. Amandeep Singh as DW2. Both witnesses were duly cross examined on behalf of the complainant and discharged. DE was closed vide separate statement of the accused recorded on 14.07.2022 and accordingly, matter was adjourned for final arguments.
10. Final arguments were heard by this court on 31.10.2022. I have heard counsel for the parties, perused the record and have gone through the relevant provisions of the law.
11. At the very outset, it is pertinent to lay down the ingredients of the offence u/s. 138 of NI Act. In Jugesh Sehgal vs. Shamsher Singh Gogi, (2009) 14 SCC 683, the Hon'ble Supreme Court of India culled out the following ingredients in order to constitute an offence u/s. 138 of NI Act:
"13. 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;CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 4 of 17
(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;
(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 of the said 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 Act."
12. Ld. Counsel for the complainant has submitted that there exists legally enforceable liability in favour of the complainant on the basis of presumption under section 139 NI Act and also on the basis of the averments made in the complaint and the evidence by way of affidavit. He has further submitted that the cheques in question were issued to the complainant by the accused in discharge of legally enforceable debt or liability and the dishonour of the said cheque is proved by bank return memos already placed on record. Further, legal demand notice has been CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 5 of 17 duly served on the accused. He has further submitted that the complainant received no payment within 15 days of the service the legal notice. Ld. Counsel for complainant has thus submitted that all the ingredients laid down u/s. 138 NI Act are fulfilled and the accused should be convicted.
13. Ld. counsel for the complainant has further submitted that the accused has taken contradictory stands at different stages of the proceedings which shows the falsity in the case of the accused. To this effect, he has drawn the attention of this court to the plea of defence taken by the accused while serving of notice u/s. 251 CrPC to the accused wherein the accused has stated that he had given four cheques to Mr. Inderjeet Julka against friendly loan of Rs. 25000/- and three of those cheques are the cheques in question. He has further stated that similar stand has been taken by the accused while giving his statement u/s. 313 CrPC and application u/s. 315 CrPC filed on behalf of the accused particularly para no. 2 of the said application. Ld. counsel for the complainant has further submitted that the accused has completely changed his stand when he entered the witness box on 11.02.2020 and on 31.05.2022, wherein the accused has stated that he had taken a friendly loan of Rs. 1,00,000/- from Mr. Inderjeet Julka. Ld. Counsel for the complainant has submitted that this clearly shows that the accused is taking an inconsistent defence and this shows falsity of the defence of the accused.
14. Before moving forward with the contentions of the accused persons, it is pertinent to discuss the relevant provisions of law which deal with legally enforceable debt or liability under the NI Act which are section 118(a) and 139 of the NI Act.
CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 6 of 17Section 118(a) of the NI Act deals with the presumption of consideration and section 139 of NI Act deals with presumption of legally enforceable debt or liability and reads as follows:
"118. Presumptions as to negotiable instruments-
Until the contrary is proved, the following presumptions shall be made:
(a) of consideration: that every negotiable instrument was made or drawn for consideration, and that every such instrument when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration;
***
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."
15. It is further pertinent to mention the relevant judgments on the point of presumption of legally enforceable debt or liability. Reliance is placed by this court upon the judgments of Hon'ble Supreme Court of India in Rangappa v. Sri Mohan, (2010) 11 SCC 441, Kumar Exports vs. Sharma Carpets, (2009) 2 SCC 513, and Bir Singh vs. Mukesh Kumar, (2019) 4 SCC 197, wherein it has held that the presumption u/s. 139 NI Act is a presumption of law and not presumption of fact. It has further been held that it is not necessary that the cheque must have been filled by the accused himself and the accused may be liable even when the cheque has been filled by the complainant. The essential requirement is that the liability must exist on the date of the presentation of the cheque in question. It has been further CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 7 of 17 held that once the signatures on the cheque are admitted then the court is bound to raise presumption u/s. 118 r/w. 139 NI Act regarding existence of legally enforceable debt or liability.
16. In the facts of the present case, the signatures on the cheque in question have been admitted. Accordingly, this court raises presumption under section 118(a) r/w. section 139 of NI Act that the cheque in question was issued by the accused to the complainant in discharge of legally enforceable debt or liability and it is now on the accused to raise a probable defence and to prove his case on the basis of preponderance of probabilities.
17. Before moving forward to the contentions of the accused, it is pertinent to note two points raised by the counsels for both the parties. Firstly, coming to the submissions of Ld. counsel for the complainant that the accused has admitted his liability while serving of notice upon him. The relevant portion of the notice, for the sake of convenience is reproduced as follows:-
"Q8. Do you have any existing liability towards the complainant?
A.Yes."
18. Per Contra, Ld. counsel for the accused has submitted that the same is a typographical mistake and the same is evident from the fact that the accused is contesting the present matter on merits and has stated that there was no transaction between the complainant and the accused. He has further drawn the attention of this court towards the plea of defence taken by the accused immediately after the said question, wherein the entire of the accused is that there is no legally enforceable debt or liability in favour of the complainant.
CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 8 of 1719. Secondly, Ld. counsel for the accused has submitted that the complainant has filed a false case against the accused and he has admitted the same during cross-examination on 24.09.2019, wherein it is stated by the complainant as follows:
"It is wrong to suggest that whatever I have stated here is true."
20. Per Contra, Ld. counsel for the complainant has submitted that the same has happened only because the same is a typographical error and there is no reason why the complainant would contradict his whole case. He has further submitted that even if the same is not to be deemed to be a typographical error that it means that the accused is suggesting that the complainant is stating true facts before this court, which would contradict his entire case.
21. I have heard the submissions of both the counsels on both the points at length. In my considered opinion, both of these are typographical errors, since if the statements are admitted to the true, then the same contradict the entire case of the complainant and the defence of the accused to its core.
22. Now coming to the defence of the accused, wherein he has taken a defence that there is no legally enforceable debt or liability in favour of the complainant as no transaction as stated in the complaint has ever taken place between the accused and the complainant and the real transaction has taken place between the accused and one Mr. Inderjeet Julka who is the employer of the complainant. He has further taken a defence that the complainant does not have the necessary financial capacity or the source of funds to advance the said loan amount. Ld. counsel for CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 9 of 17 the accused has further submitted that even if the entire case of the complainant is admitted to be true, then also as per the complainant himself, the said sum of money was advanced as financial aid and not as a loan and accordingly, the same is not legally recoverable.
23. To show that the cheques in question were never issued to the complainant, Ld. counsel for the accused has relied upon the contradictions of the versions of the complainant in the complaint, in the legal demand notice and during cross examination in regard to issuance of cheques. First of all, attention of this court is drawn towards paragraph no. 4 of the complaint wherein it is stated that the cheques have been issued in favour of the complainant by the accused in the month of March. It is stated in the legal demand notice that, in the month of March, the accused expressed his inability to repay the loan. It is further stated in the legal demand notice itself that the cheques have been issued in the month of April, 2018. Further attention of this court has been drawn towards cross examination of the complainant dated 24.09.2019, wherein the complainant has stated that the cheques were handed over to him in the month of March, 2018.
24. Ld. counsel for the accused has stated that these contradictions have been occurred as no transaction as stated in the complaint filed by the complainant has ever taken place and the accused has never taken any loan from the complainant. Furthermore, no cheques have ever been handed over to the complainant and the cheques in question were given to one Mr. Inderjeet Julka and not to the complainant.
CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 10 of 1725. Per Contra, Ld. counsel for the complainant has submitted that the contradictions in regard to the issuance and handing over the cheque by the accused to the complainant are not material contradictions which go to the root of the matter. He has further submitted that the same are merely typographical errors and should not be read against the complainant.
26. The entire case of the accused is that he has not handed over the cheques in question to the complainant, however, the same were given to one, Sh. Inderjeet Julka, who is the employer of the complainant. The contradictions that have been pointed out by the counsel for the accused pertain to handing over of the cheques in question itself. Furthermore, the same cannot be termed to be typographical errors, since it is explicitly stated in the legal notice that the complainant approached the accused in March, however, the accused expressed his inability to pay the due amount and then he again approached in April, when the accused handed over the cheques in question. During cross- examination, it has been expressly admitted by the complainant that he approached the accused two times, one in March and another in April, however, the cheques were received by him in the month of March.
27. On the basis of submissions made by counsels, the defence of the accused and overall facts and circumstances of the case, I am of the considered opinion that the accused has been able to show on the basis of preponderance of probabilities that he did not hand over the cheques in question to the complainant.
28. Secondly, the accused has taken a defence that the complainant has not been able to prove his financial capacity or CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 11 of 17 his source of funds for the purposes of advancement of loan in question. In this regard, Ld. counsel for the accused has submitted that during cross-examination on 09.09.2019, the complainant has stated that he had paid the said sum of Rs. 75,000/- partly from his savings in cash and partly by withdrawal from his bank account. He has stated that he had paid a sum of approximately Rs. 25,000/- to Rs. 30,000/- from his savings and he had withdrawn the remaining amount from bank. Thereafter the cross-examination of the witness was deferred for want of the bank statement of the complainant. Ld. counsel for the accused has drawn the attention of this court to the fact that on the next date of hearing, i.e., on 24.09.2019, when the cross-examination was completed, no bank statement was filed by the complainant. He has further submitted that even till today, no application has been filed on behalf of the complainant to place on record the said bank statement.
29. Per Contra, Ld. counsel for the complainant has submitted that the complainant was earning Rs. 22,000/- per month and his expenditure was only Rs.5,000/- to Rs.6,000/- as stated by him in his cross-examination dated 09.09.2019, accordingly, it cannot be said that the complainant was not having the financial capacity or the necessary funds to advance a sum of Rs. 75,000/- to the accused.
30. There are two aspects which have to be dealt here. First is whether the complainant has been able to show that he was earning a salary of Rs.22,000/- and secondly, whether the complainant was having a balance of approximately Rs.50,000/- in his account.
CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 12 of 1731. For the first aspect, when it is the case of the complainant that he used to receive his salary in cash and also did not file any Income Tax Return, the complainant could have examined his employer or any other person who used to disburse the salary of the complainant. Admittedly, the complainant has not examined either of these persons. There is nothing on record except the bald assertion of the complainant that he was earning Rs. 22,000/- from his employment.
32. For the second aspect, the complainant was called upon to bring his bank statement. However, despite the fact that the cross-examination was deferred only for this purpose, the complainant has not brought his bank account statement to show that he had a balance of more than Rs.50,000/- in his account and to show the withdrawal of the same. This court is thus constrained to draw an adverse inference against the complainant in terms of section 114 of the Indian Evidence Act, that had he brought the bank account statement as demanded from him, then the same would have proved something against the complainant and would not have supported his case.
33. In APS Forex Services Pvt. Ltd. vs. Shakti International Fashion Linkers and Ors., (2020) 12 SCC 724, it was laid down by Hon'ble Supreme Court of India as follows:
"We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and at CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 13 of 17 that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque."
34. In Basalingappa vs. Mudibasappa, (2019) 5 SCC 418, it was held by Hon'ble Supreme Court of India that the accused can always show that the complainant had no financial capacity to advance the alleged loan and the same shall be a probable defence which the accused can raise.
35. Reliance is further placed by this court on the judgment of Hon'ble Kerala High Court in Sunitha vs. Sheela Antony, 2020 SCC OnLine Ker 1750, wherein the principles laid down by the Hon'ble Supreme Court of India in the above mentioned judgments have been summarized and it has been held as follows:
"The complainant has no obligation, in all cases under Section 138 of the Act, to prove his financial capacity. But, when the case of the complainant is that he lent money to the accused by cash and that the accused issued the cheque in discharge of the liability, and if the accused challenges the financial capacity of the complainant to advance the money, despite the presumption under Section 139 of the Act, the complainant has the obligation to prove his financial capacity or the source of the money allegedly lent by him to the accused. The complainant has no initial burden to prove his financial capacity or the source of the money. The obligation in that regard would arise only when his capacity or capability to advance the money is challenged by the accused."
(Emphasis supplied)
36. Therefore, in cases in which the debt transaction is a cash CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 14 of 17 transaction, the accused can raise a probable defense by questioning the financial capacity and the source of the complainant, and once the said question is raised, the onus shifts on the complainant to prove his financial capacity.
37. On the basis of the above-cited judgments and in the facts of the present case, the accused has been successfully able to prove on the basis of preponderance of probabilities that the complainant did not have the necessary financial capacity or the source of funds to advance the alleged loan amounting to Rs. 75,000/- as stated in the complaint.
38. Ld. counsel for the accused has thirdly stated that even if it is presumed for the sake of arguments that the money has been taken by the accused from the complainant then even also as per the version of the complainant the same was obtained only as financial aid or help and not as loan which is so stated by him during his cross examination on 24.09.2019. He has further stated that in the complaint it is not even clarified if the money is given as a financial aid or loan or help and all the three terms have been used in the alternative in paragraph no. 3 of the complaint. He has accordingly submitted that when the money was given only for financial aid, then it cannot be stated that the same is legally recoverable.
39. Per contra, Ld. counsel for the complainant has submitted that the complainant had given the money to the accused in order to help him in the marriage of his daughter. He has further submitted that merely giving a sum of money for the purposes of financial aid does not mean that there was no intention of seeking repayment of the same. He has further stated that the complainant CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 15 of 17 has specifically stated in the complaint that the said sum of money was to be repaid by the accused within a period of 2 months. Accordingly, the intention of the parties was to grant a particular sum of money and seek its repayment upon completion of the said period of 2 months.
40. In my considered opinion, merely because, the term financial aid has been used by the complainant does not mean that the complainant had performed a gratuitous act. There is nothing on record to suggest that the complainant had given the said sum of Rs. 75,000/- to the accused gratuitously and had no intention of seeking its repayment. It is true that if a sum of money has been given gratuitously to the accused, then the same does not give rise to legally enforceable debt or liability and it is only the accused who can offer to repay the said sum of money voluntarily. However, there is nothing on record to suggest that the complainant had advanced the said sum of Rs. 75,000/- gratuitously. Accordingly, the defence of the accused that the debt or liability in question is not legally recoverable is devoid of any merits and accordingly, is rejected.
41. Lastly, dealing with the submissions of ld. counsel for the complainant that the accused has taken contradictory stands, in my considered opinion, merely changing the amount of loan taken does not show inconsistency. The accused has always stated that he has not taken any loan from the complainant and he has taken the loan from Mr. Inderjeet Julka. Moreover, the accused has also been consistent with his defence that he had handed over the cheques in question to Mr. Inderjeet Julka and not to the complainant.
CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 16 of 1742. It is also imperative to understand that in order to pronounce a conviction in a criminal case, the accused 'must be' guilty and not merely 'may be' guilty. For an accused to be guilty, guilt should not be based on mere surmises and conjectures but it should be based on cogent evidence.
43. In view of the above discussion and in view of the judgments of Hon'ble Superior Courts as stated above, the accused has been able to raise raise a probable defence and has been able to prove his defence on the basis of preponderance of probabilities that there is no legally enforceable debt or liability in favour of the complainant and against the accused equivalent to the amount of cheque in question as on the date of its drawal or on the date of its presentation. Thus, the accused has been able to rebut the presumption u/s. 118 r/w. section 139 NI Act and the complainant has failed to prove its case beyond reasonable doubt qua the accused in respect of the cheque in question.
44. In view of the aforesaid, accused Shamsher Singh @ Shera is hereby acquitted of offence under section 138 Negotiable Instruments Act.
Note: This judgment contains 17 signed pages and each page has been signed by the undersigned.
Announced in Open Court (Anshul Singhal) on 11.11.2022 MM(N.I. Act)-03/NDD/RACC/ND CC No. 14422/2018 Desh Raj Thakur vs. Shamsher Singh @ Shera Page 17 of 17