Delhi District Court
Pg. 1 P.K Alu Infra vs . Vardey Devi Edu. Society Cc No. ... on 16 January, 2023
IN THE COURT OF METROPOLITAN MAGISTRATE (NI ACT),
NORTH-WEST, ROHINI, DELHI
Presided over by- Sh. Vikas Madaan, DJS
CNR No. DLNW020023232012
CC No. 8084-2016
M/s P.K Aluinfra Pvt. Ltd. Through
Mr. Parth Bhardwaj
R/o E-989, Saraswati Vihar,
Pitampura, Delhi-110034
............Complainant
Versus
Vardey Devi Education Society
Misran Mohalla, Beri Road, Sampla,
Rohtak, Haryana
Also at,
Vardey Devi Institute of Engineering and Technology,
Brahamanwas, Julana, Jind-126101
Haryana
.............Accused no. 1 Digitally
VIKAS signed by
MADAAN VIKAS
MADAAN
pg. 1 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
Harikishan Sharma,
President/Chairman
Vardey Devi Education Society,
D-16/28, Sector-3, Rohini,
Delhi
............Accused no. 2
Bharat Bhushan
Treasurer
Vardey Devi Education Society,
D-16/28, Sector-3, Rohini,
Delhi
............Accused no. 3
JUDGMENT
(1) Name of the complainant, : M/s P.K Aluinfra Pvt. Ltd.
parentage and address (2) Name of accused, :1.Vardey Devi Education Society parentage and address 2. Harikishan Sharma
3. Bharat Bhushan (3) Offence complained of or proved : 138 N.I. Act Digitally VIKAS signed by MADAAN VIKAS MADAAN pg. 2 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 (4) Plea of accused : Pleaded not guilty (5) Date of institution of case : 25.07.2012 (6) Date of reserve of order : 30.07.2022 (7) Date of Final Order : 16.01.2023 (8) Final Order : Acquitted Argued By:
Sh. Ramit Malhotra: For Complainant Sh. S.S Parashar: For Accused BRIEF FACTS RELEVANT FOR THE DECISION OF THE CASE A. FACTUAL MATRIX
1. Vide this judgment I shall dispose of the complaint filed by the complainant under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the 'Act ').
2. The substance of the allegations, as contained in the complaint, are as follows:
VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 3 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 a. The complainant claims that accused no. 1 is a society and accused no. 2 and 3 were its chairman/President and treasurer respectively (hereinafter referred to as "accused persons", for brevity). That accused persons entered into a loan agreement dated 15.11.2008 with the complainant to lend a sum of RS. 50,00,000/- (Rupees Fifty Lakhs Only) as an unsecured loan @ 12% interest per annum for the construction of college building in village Brahmanwas, Julana Dist- Jind, Haryana. That as per contractual obligations, the complainant on numerous occasions paid an amount of Rs. 2,88,88,017(excluding interest @ 12% per annum) to the accused persons and out of the said amount, an amount of Rs. 26,402,001/- was received by the complainant from November 2008 to January 2012 and an amount of Rs. 24,86,016/- was left towards total payment towards the accused persons. That on request of the accused persons, complainant agreed to settle the balance payment of Rs. 24,86,016/- for an amount of Rs. 20,00,000/- excluding any interest thereupon.
b. In discharge of that liability, accused persons had issued a cheque bearing no. 074814 dated 19.04.2011 for an amount of Rs. 20,00,000/- drawn on Oriental Bank of Commerce, Sector-8, Rohini, Delhi-42(hereinafter referred to as "cheque in question", for brevity) with the assurance that the said cheque would be honoured upon its presentment. That upon presentment, the cheque in question got dishonoured with the remarks "FUNDS INSUFFICIENT" vide return memo dated 25.05.2012. Thereupon, a legal demand notice dated 12.06.2012 was sent to the accused VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 4 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 persons through Regd. A.D/speed post and it is the case of the complainant that despite service of notice, accused persons failed to pay the cheque amount within stipulated time.
B. PRE-SUMMOING EVIDENCE & NOTICE
3. Pre-summoning evidence was led by the complainant and upon appreciation of pre-summoning evidence, accused persons were summoned for an offence punishable under Section 138 of the Act and notice under Section 251 Cr.P.C. for this offence was framed upon accused persons on 09.05.2013 to which they pleaded not guilty and claimed trial. Accused no. 2 (also on behalf of accused no.1) took the defence that complainant was a treasurer in his society and at that time he must had taken the cheque in question and misused it against him.
He further stated that he used to sign blank cheques in lieu of some bills on the faith of the complainant. He further stated that he owed no liability towards the complainant. In his plea of defence, accused no. 3 stated that complainant was a treasurer in his society and at that time he must had taken the cheque in question and misused it against him. He further stated that he used to sign blank cheques in capacity of manager of the society and in lieu of some bills on the faith of the complainant. He further stated that he owed no liability towards the complainant. He denied qua receiving of legal demand notice.
4. Thereafter, the accused moved an application u/s 145(2) NI Act which was allowed vide order dated 09.05.2013 and the complainant was allowed to cross-examined by the accused.
VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 5 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 C. COMPLAINANT'S EVIDENCE
5. In his evidence, AR of the complainant namely Parth Bhardwaj examined himself as CW-1. He relied upon his pre-summoning evidence towards post-summoning evidence and the same is Ex. CW1/1. He relied upon the following documentary evidence against the accused to prove his case beyond reasonable doubt: -
Ex. CW1/A Power of Attorney/Board Resolution dated 23.07.2012 Ex. CW1/B Loan Agreement dated 15.11.2008 Ex. CW1/C Original cheque bearing no. 074814 Ex. CW1/D Cheque returning memo dated 25.05.2012 Ex. CW1/E Legal Demand notice dated 12.06.2012 Ex. CW1/F Tracking report Ex. CW1/G Postal receipt of speed post Ex. CW1/H Complaint
6. CW1 was further subjected to cross-examination by the Ld. counsel for the accused. Thereafter, the complainant's evidence was closed vide order dated 12.02.2012 at the request of the AR of the complainant.
Digitally VIKAS signed by MADAAN VIKAS MADAAN pg. 6 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 D. STATEMENT OF ACCUSED
7. Statement of the accused persons were recorded under section 313 Cr.P.C on 14.11.2017 wherein all the incriminating evidences were put up before the accused persons. In reply, accused no. 2 stated that his society had never taken any loan from the complainant and complainant became partner in his society in November, 2008. He further stated that to became a partner in his society, complainant initially gave a sum of Rs. 50,00,000/- to the society. He further stated that complainant was on the post of treasurer in the society and he used to keep his signed cheques with the complainant as he was treasurer of the society. He further stated that he had paid full and final payment to the complainant regarding the amount invested by the complainant to the society and now he owed no liability towards the complainant. He further wished to lead his defence evidence.
8. Similarly, accused no. 3 in his reply, stated that he had never entered into an agreement for a loan of sum of Rs. 50,00,000/- and he signed the Ex. CW1/B only as a witness. He further stated that cheque in question was not issued by him to the complainant though it bears his signatures. He further stated that complainant Sh. Parth Bhardwaj was working as a secretary cum treasurer of his society from 2009 to 2010. He further stated that the cheque in question was misused by the complainant. He further stated that he owed no liability towards the VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 7 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 complainant and his society has already made the complete payment to the complainant. he further wished to lead his defence evidence.
E. DEFENCE'S EVIDENCE
9. In his defence evidence, accused persons has examined the following witness: -
ORAL EVIDENCE DW-1 Hari Krishan Sharma (accused no. 2) DW-2 Bharat Bhushan (accused no. 3) DW-3 Rishabh Singhal (marketing officer, Bank of India) DW-4 Sewa Singh Shokeen (special assistant, Oriental Bank of Commerce) DW-5 S.P Sharma (Principal of accused no. 1) DW-6 R.P Bhardwaj
10.Thereafter final arguments heard on part of both the Ld. counsel for the complainant and accused. I have heard the rival contentions of both the counsel and given my thoughtful consideration to the material appearing on record.
F. INGREDIENTS OF OFFENCE AND DISCUSSION VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 8 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
11.Before dwelling into the facts of the present case, it would be apposite to discuss the legal standards required to be met by both sides. In order to establish the offence under Section 138 of NI Act, the prosecution must fulfil all the essential ingredients of the offence. Perusal of the bare provision reveals the following necessary ingredients of the offence: -
First Ingredient: The cheque was drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity;
Second Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability;
Third Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank;
Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonor of cheque from the bank;
Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 9 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
12.The accused can only be held guilty of the offence under Section 138 NI Act if the above-mentioned ingredients are proved by the complainant co-extensively. In addition to the above, the condition stipulated under section 142 NI Act have to be fulfilled.
13.Notably, there is no dispute at bar about the proof of third, fourth and fifth ingredients. The cheque in question was return unpaid vide return memo Ex. CW/C with remarks "Funds Insufficient" was also duly proved. The complainant had proved on record the legal notice vide Ex. CW1/E and the notice was duly sent was proved vide Ex. CW1/G, and CW1/F as duly proved by the fact that accused persons have never disputed their addresses. Reliance in this regard can be placed on one of the judgments of the Hon'ble Apex Court titled as C.C Alavi Haji vs. Palapetty Muhammed & Anr [(2007) 6 SCC 555]. As such, based on above, the third, fourth and fifth ingredient of the offence under section 138 NI Act stands proved against the accused.
14.The controversy in the present complaint pertains to First and Second ingredient.
I. CONTENTIONS IN RELATION TO NON-FULFILMENT OF FIRST INGREDIENT
15. Ld. counsel for the accused contended that Ex. CW1/C i.e. cheque in question and the cheque for which the complainant has filed the present case was not same rather in legal demand notice vide Ex. CW1/E, VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 10 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 Evidence by way of affidavit vide Ex. CW1/1 and in the present complaint, the complainant stated that the cheque which was allegedly issued was a cheque bearing no. 074814, drawn on Oriental Bank of Commerce, Sector-8, Rohini, Delhi was dated 19.04.2011, but the date mentioned on the cheque filed on record was 19.04.2012 and thus, the complainant has failed to establish that the cheque in question and for which he has filed the present case are same. It is further contended by the Ld. counsel that complainant was asked at the time of his cross- examination that whether he read the contents of his complainant and affidavit carefully, to which he replied in affirmative and thus, the same also cannot be termed as a typographical error and accordingly, the present complaint is not maintainable being filed for a different cheque.
COURT'S OBSERVATION:
16. In J.Samuel & Ors vs Gattu Mhesh & Ors,(16 January, 2012), Hon'ble Apex Court observed that "...the term typographical error is defined as a mistake made in the printed/typed material during a printing/typing process. The term includes errors due to mechanical failure or slips of the hand or finger, but usually excludes errors of ignorance. Therefore the act of neglecting to perform an action which one has an obligation to do cannot be called as a typographical error. As a consequence the plea of typographical error cannot be entertained in this regard since the situation is of lack of due diligence wherein such amendment is impliedly barred under the Code...."
17.In the instant case, no doubt the date which was mentioned on the cheque filed on record vide Ex. CW1/C and date mentioned in the complainant are not same, however, the identity of the cheque is very Digitally VIKAS signed by MADAAN VIKAS MADAAN pg. 11 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 well established by the complainant by mentioning the cheque number and the branch of the bank to which it pertained. Further, when the complainant has filed on record the original cheque with his complaint, he fulfilled his obligation towards the accused persons by providing them a fair idea of the subject matter of the present complaint. Moreover, this Court has also explained the charges to the accused persons before the trial was started to avoid any confusion regarding the subject matter of the present case and thus, in the opinion of this Court, the mentioning of date as 19.11.2011 in complaint was only a typographical error and consequently, this contention of the accused is devoid of any merits.
II. CONTENTIONS IN RELATION TO NON-FULFILMENT OF SECOND INGREDIENT
18.As far as the proof of second ingredient is concerned, the complainant has to prove that the cheque in question was drawn by the drawer for discharging a legally enforceable debt. In the present case, the accused admitted his signature upon the cheque in question. As per the scheme of the NI Act, once the accused admits signature on the cheque in question, certain presumptions are drawn, which result in shifting of onus. Section 118(a) of the NI Act lays down the presumption that every negotiable instrument was made or drawn for consideration. Another presumption is enumerated in Section 139 of NI Act. The provision lays down the presumption that the holder of the cheque received it for the discharge, in whole or part, of any debt or other liability.
VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 12 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
19.The combined effect of these two provisions is a presumption that the cheque was drawn for consideration and given by the accused for the discharge of debt or other liability. Both the sections use the expression "shall", which makes it imperative for the court to raise the presumptions, once the foundational facts required for the same are proved. Reliance is placed upon the judgment of the Hon'ble Supreme Court, Hiten P. Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16.
20.In case of Kumar Exports vs. Sharma Carpets, (2009) 2 SCC 513, the Hon'ble Supreme Court had held:
"The accused under Section 138 NI Act has two options. He can either show that the consideration and debt did not exit or that under the particular circumstances of the case, the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumption, an accused is not expected to prove his defence beyond reasonable doubt as it is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note 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 disprove the non-existence of 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 bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which his 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 VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 13 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probably that a prudent man under the circumstances of the case, act upon the plea that they did not exist. Apart from adducing direct evidence to prove that the note in question, was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon the circumstantial evidence and if the circumstances so relied upon are so compelling, the burden may likewise shift again on the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arises under Section 118 and 139 of NI Act''.
21.So far as the facts of liability is concerned, in view of mandatory presumption of law as discussed above, if any cheque has been produced by the complainant bearing the signatures of the accused, there cannot be any inherent lacuna in the existence of the liability. But then definitely, accused can point loop holes in the story of the complainant by impeaching the credit of the witness during his cross- examination. The accused can discharge his burden by demonstrating the preponderance of probabilities coming in its way. In the present case, the defences raised by the accused to rebut the presumptions are discussed below:
Contention 1: Cheque was never issued to the complainant VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 14 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 ARGUMENTS OF THE ACCUSED:
22.It is contended by the Ld. counsel for the accused that the cheque in question was never issued by the accused to the complainant rather the complainant was a holding a post of treasurer in the accused society and he had full access to the office of the accused society and the cheque in question was stolen by him from society's office. It is further argued that complainant had concealed this material fact from the Court and he hasn't approached this Court with clean hands.
COURT'S OBSERVATION:
23.In the instant case, the complainant has himself admitted that he was a treasurer in accused society for a period of 7-8 months in the year 2009. However, the accused has failed to place on record any material evidence to prove that the cheque in question was stolen by him from the office of the society of the accused. No complaint or F.I.R was placed on record to show that accused society had taken any steps against the complainant despite knowing the cheque in question was in possession. Moreover, the accused person has never denied about the dealings with the complainant and thus, this possibility cannot be ruled out that the cheque in question might have given by the accused society to the complainant. Although whether the same was given in discharge of any liability, it will be discussed in the latter part of this judgment.
VIKAS Digitally signed
by VIKAS
MADAAN MADAAN
pg. 15 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
Contention 2: No debt existed towards the
complainant
ARGUMENTS OF THE ACCUSED:
24.It is submitted by the Ld. counsel for the accused that cheque in question was never issued in discharge of any legal debt or liability and no debt was due towards the accused on the day the cheque in question was presented by the complainant. It is further contended by the Ld. counsel that no account statements were ever produced by the complainant to prove the liability towards the accused. It is further argued by the Ld. counsel that a final settlement was executed between the complainant and accused vide Ex. CW1/D3 and subsequent to that and in continuation of the aforesaid settlement, Ex. DW1/1 was further executed on 09.12.2011 between the parties, and as per the said settlement, the accused has already paid the entire amount to the complainant and as such nothing remains due against the accused to be payable to the complainant. It is further argued that even the complainant during his cross-examination has admitted that they have received the entire amount from the accused in compliance of Ex. CW1/D3 and Ex. DW1/1. It is further contended that father of the complainant namely R.P Bhardwaj(DW-6) has also admitted his signature at point 'E' on ex. DW1/1 and the document stands duly proved. Thus, it is argued that the present complaint shall liable to be dismissed.
Digitally VIKAS signed by MADAAN VIKAS MADAAN pg. 16 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016 COURT'S OBSERVATION:
25. This Court has analysed this contention. After analysing the same, this Court find merits in the contention of the Ld. counsel. The complainant, during his cross-examination has admitted the execution of Ex. CW1/D3 and he has further deposed that the cheque no. 844697 was credit in his account and the amount of Rs. 38.5 lacs do not stand due against the accused in their accounts and the said amounts was received by them in instalments paid through cheques. This admission of the complainant has further proved Ex. DW1/1 because the conditions mentioned therein were duly performed by the accused persons. Further, DW-6 has also admitted his signatures on Ex. DW1/1. Resultantly, accused has succeeded in impeaching the testimony of the complainant about the existence of a debt/legal liability.
26.Therefore, so far as the second ingredient is concerned, accused has successfully raised a probable defence and rebut the presumption qua legal consideration.
27.It is a settled position of the law that the case of the complainant should stand on its own legs. It cannot take advantage of the weakness of the defence, nor can the court, on its own make out a new case for the prosecution and convict the accused on that basis. If defence version is incorrect, it does not mean that the prosecution version is necessarily correct. Therefore, the contention of the Ld. Counsel for the complainant regarding the deep defence of the accused appears to be of no use in sailing through the case of the complainant.
VIKAS Digitally signed by VIKAS MADAAN MADAAN pg. 17 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016
28.Thus, in view of the totality of the circumstance and the settled legal positions, the case attempted to be built by the complainant, appears to be suffering from fatal infirmities so much so, it goes directly to the root of the case and shakes the very edifice on which the case of the complainant rests. It is also relevant to mention here that it is of paramount importance to demand evidence of unambiguous, impeccable and of unimpeachable in nature so as to entail criminal conviction of the accused and which the complainant has failed to bring.
29.In light of the aforementioned discussion, the complainant has failed to prove all the essential ingredients of section 138 of the NI act. Accordingly, accused no. 1 Vardey Devi Education Society, accused no. 2 Sh. Hari Kishan Sharma and accused no. 3 Sh. Bharat Bhushan stands Acquitted from the offence under section 138 r/w section 141 of the NI Act, 1881.
VIKAS Digitally signed
by VIKAS
MADAAN MADAAN
ORDER: - Acquitted (VIKAS MADAAN)
ANNOUNCED IN THE OPEN COURT METROPOLITAN MAGISTRATE, ROHINI TODAY 16.01.2023 DISTRICT COURTS, DELHI Note: This judgment contains 18 pages and each page is signed by the under signed.
pg. 18 P.K Alu Infra vs. Vardey Devi Edu. Society CC No. 8084-2016