Delhi District Court
Shorn Of Unnecessary Details vs M/S Sharma Carpets on 29 April, 2019
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IN THE COURT OF MS. NEETI SURI MISHRA: METROPOLITAN MAGISTRATE02
(CENTRAL), TIS HAZARI COURTS:DELHI
Rajesh Sanghi v. Mahavir Singh
CIS No. 534102/16
U/s: 138 Of Negotiable Instruments Act.
P.S. Pahar Ganj
CNR No. DLCT020010022010
J U D G M E N T
Date of filing of complaint : 23.01.2010
Date of judgment : 29.04.2019
Name of the complainant : Rajesh Sanghi
Name of accused : Mahavir Singh, S/o Late Sh. Zile Singh,
R/o. H. No. 266, Village Darya Pur
Kallan, Delhi.
Offence complained of : U/s 138 NI Act
Offence charged of : U/s 138 NI Act
Plea of the accused : Pleaded not guilty.
Final order : Convicted
CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh
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1. Shorn of unnecessary details, the facts of the present case are that the complainant Sh. Rajesh Sanghi has filed the present complaint u/s 138, Negotiable Instruments Act,1881, through his duly authorized attorney namely Sh. Rajeev Gupta, Manager of M/s Sky Automobiles, situated at 1E/11, Jhandewallan Extn. Delhi55. The case of complainant is that the complainant is the proprietor of M/s Skylines Automobiles and is also an authorized dealer of Mahindra and Mahindra Ltd. who are the manufacturers of vehicles including the Bolero range of vehicles. It is submitted that on 13.09.2008, the accused purchased one new Mahindra Bolero SLE (bearing chasis no.82G11654 and engine no. GB84G53919) (which shall hereinafter be referred to as "the vehicle") from the complainant against Invoice bearing no. 9870 for an aggregate sum of Rs.6,04,133/ (comprising of Rs.5,72,243/ as the sale price of the vehicle and Rs.31,890/ as an additional amount of registration and logistics in respect of the vehicle).
2. Complainant further submitted that the accused had purchased the aforesaid vehicle with the assurance that he will get the said vehicle financed from ICICI bank for a sum of Rs.5,00,000/ and that the balance amount would be paid by the accused, himself. It is alleged that in compliance with the abovestated promise, the accused paid a sum of Rs.5000/ and Rs.1,00,000/ against receipt no. 49108 dated 08.09.2008 and receipt no.49191 dated 13.09.2008, respectively. Accordingly, thereafter the said vehicle was delivered to him against delivery receipt dated 13.09.2008. However, subsequently the ICICI bank Ltd. declined the application for grant of car loan of the accused for not being satisfied with the formalities and thereafter, the accused in discharge of his lawful liability and debt towards the complainant for payment of the balance purchase price of the Bolero car issued a cheque bearing no. 341907 dated 16.11.2009 for a sum of Rs.5,50,000/ drawn on State Bank of India, Bawana, Narela Road, Delhi39. Complainant's case is that sum of Rs.5,50,000/ includes both the balance purchase price of vehicle as well as the CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 3 loss of interest caused to the complainant from the date of purchase of vehicle till the date of issue of cheque to him.
3. Complainant contends that the cheque having been issued to the complainant was presented by him on 17.11.2009 with his bank but the said cheque got dishonored and was returned with remarks "Funds Insufficient" vide return memo dated 20.11.2009 and the information was received vide bank return memo on 21.11.2009. It is stated that, thereafter legal demand notice dated 27.11.2009 was got served on the accused which was duly received and thereafter replied to by the accused vide reply dated 05.12.2009 and it is alleged that since the accused failed to pay the cheque amount within 15 days of receipt of legal demand notice, the accused has committed offence punishable under Section 138 NI Act. Hence, the present complaint against him was filed by complainant.
4. Pursuant to filing of present complaint, the complainant led presummoning evidence in compliance with Section 200 Cr.P.C. and on the basis of the pre summoning evidence, court took cognizance of the offence and summoned the accused. On appearance of accused, he was explained the substance of accusations against him in terms of Section 251 Cr.P.C., to which he did not plead guilty and claimed to be tried. Subsequently, the authorized representative of complainant Shri Rajeev Gupta adopted his presummoning evidence at the stage of his post summoning evidence and he was crossexamined by the Ld. Counsel for the accused, after the application of accused under Section 145(2) NI Act, was allowed by the court.
5. CW 1 Rajeev Gupta deposed on the lines of his complaint and exhibited the following documents i.e. (1) Ex CI Evidence by way of affidavit of CW1, (2) Ex.CW1/1 Copy of Power of Attorney, (3) Ex.CW1/2 Copy of Invoice, (4) CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 4 Ex.CW1/3 Copy of Statement of Account, (5) Ex.CW1/4 Copy of Delivery Receipt, (6) Ex.CW1/5 Cheque in question, (7) Ex.CW1/6 Deposit Slip, (8) Ex.CW1/7 Chqeue Return Memo, (9) Ex.CW1/8 Legal Notice, (10) Ex.CW1/9 & Ex.CW1/10 Regd. AD and UPC Post Slip and (11) Ex.CW1/11 Reply of legal notice of complainant.
6. The witness was duly crossexamined by the Ld. Counsel for accused and on completion of evidence of complainant, the statement of accused was recorded under Section 313/281 Cr.P.C. The accused thereafter, opted to lead defence evidence and he examined one witness from the Transport Authority, Rohini and moved application under Section 315 Cr.P.C. for examining himself as a witness, which was allowed by the court.
7. DW1 Ashok Kumar, Clerk, Transport Authority, Rohini ZoneII, Sector 6, produced and proved the following documents i.e. (1) Ex.DW1/AParticulars of the vehicle bearing no. DL8CNA2107, (2) Ex.DW1/B Copy of NOC issued by ICICI Bank alongwith Form 35, (3) Ex.DW1/C & Ex.DW1/D Form 34 alongwith annexures and Form 20.
8. DW2 Mahavir Singh (accused himself) deposed that in the year 2008, he approached the complainant for the purpose of purchasing a Bolero Vehicle no. DL 8C NA 2107 and it was promised by the complainant that the aforesaid vehicle will be got financed through ICICI Bank and at that time Raj Kapoor Chugh was the sales Manager of the complainant company who obtained signatures of accused on five blank cheques and accused stated that he was also asked to sign the blank file concerning the hypothecation of the aforesaid vehicle with ICICI bank and his signatures were also obtained by the Manager of the complainant company on 78 blank papers on the pretext that the signed cheques and blank file are required to be CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 5 submitted with the ICICI bank for hypothecation of the vehicle. Accused deposed that in good faith he handed over blank signed cheques bearing No. 341907 to 341911 of his bank account at SBI branch Bawana and on being asked, had also submitted his documents like Aadhar card, Pan card, electricity bill and the statement of account of his bank along with two photographs and his R.C. He further stated that he was delivered the aforesaid vehicle and had been informed by Mr. Chugh about the sanction of his car loan by ICICI bank. He stated that he had delivered the original document of insurance of the vehicle which is Ex. CW 1/A and the sales manager Kapoor Chugh asked him to deposit Rs. 2.5 lacs with the ICICI bank. He further deposed that the said amount was deposited in the bank and thereafter he was also asked to pay the insurance of the vehicle for a sum of Rs.21,872/ which he had duly paid by way of a cheque. He deposed that they also asked him for Rs. 40,000 for registration of the vehicle and he paid the same in cash to Mr. Chugh, pursuant thereto the copy of insurance of the vehicle was handed over to the accused along with one invoice for a sum of Rs.5,89,000/ approximately and stated that the gate pass was also given to him. He stated that he asked them to give the receipt of the amount paid by him but they did not issue such receipt however, had ensured him that the entire amount was going to be deposited in ICICI bank and the cover note of the insurance was also handed over to him.
9. During his evidence the witness produced the cover note of insurance and the photocopy of the same was exhibited as Ex. CW 1/D (OSR) and witness also proved the copy of R.C. of the vehicle as Ex. CW 1/D2. He stated that after 45 days Mr. Raj Kapoor Chugh had handed over the original R.C. of the vehicle and ensured him that the receipt from ICICI bank will also be handed over to him later on as it had not come from ICICI bank. He stated that after the said period as assured by Mr. Chugh he asked for the said receipt of the ICICI bank about the money which he had deposited, but failed to get a satisfactory answer as he was told that the person who CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 6 was supposed to give the receipt has been transferred. He stated that after one year and 45 days he received one legal notice Ex. CW 1/8 and he shared the same with his advocate who sent reply of the said notice which is Ex. CW1/11. He stated that thereafter he went to Jhandewalan agency to meet Mr. Sanghi but he was not available, however, he met Mr. Chugh and asked him to hand over the blank cheques given by the accused to Mr. Chugh along with all the documents pertaining to his vehicle but Mr. Chugh refused to return the cheques and the documents and in the meantime, Mr. Sanghi came there and after some discussion with him on the issue he also refused to return the same. He stated that Mr. Sanghi also told him that no such documents were with in their possession and they have already filed one complaint under section 138 N.I. Act against him. He stated that he made complaint against Mr. Sanghi and Mr. Chugh to SHO, P.S., Paharganj and thereafter FIR was registered on the basis of such complaint. The FIR is proved as Mark X. He stated that thereafter the SHO ensured to take appropriate action and enquiry is already pending but the SHO has till date not produced Mr. Chugh before the court. Witness stated that Mr. Chugh had cheated him and already 9 years have lapsed. He stated that he does not have any liability towards Mr. Sanghi as the vehicle was already financed by ICICI bank. He further stated that he had given his cheques to ICICI bank and could not understand how the said cheques were possessed by Mr. Sanghi. He further said that there was CCTV footage available at the office of Mr. Sanghi which can be seized to check when he went to meet Mr. Sanghi and in the month of October, 2009 he visited the office of Mr. Sanghi twice for getting his documents back but they refused to hand over the same.
10. On completion of his crossexamination, the accused closed defence evidence and the matter was fixed for hearing of final arguments. Final arguments from the rival parties were heard at length and the entire case file was thoroughly read and evaluated.
CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 7
11. The gravamen of the allegations in the present proceedings is the dishonor of a cheque bearing no. 341907 claimed to have been issued by the accused to the complainant. The complainant has made out a claim that on 13.9.2008 he sold one Bolero car to the accused for an aggregate sum of Rs.5,72,243/ and towards the payment of the purchase price of the said vehicle the accused made an initial down payment of Rs.1,05,000/ (Rs. Five thousand on 08.09.2008 and Rs. One lakh on 13.9.2008) and undertook to make arrangements for the sanction of car loan himself from the ICICI bank for the remaining amount of consideration. It is alleged that since his loan was not sanctioned by the bank, he later issued one cheque bearing No. 341907 dated 16.11.2009 i.e. after more than a year to the complainant for discharge of his liability of the purchase price of the vehicle along with the interest for the period for which the complainant remained unpaid. The complainant has thus alleged that the cheque in question was issued for the discharge of his legal liability by the accused but the same got dishonoured on presentation, on the ground of funds being insufficient in the account of the accused which fact was intimated to the complainant vide return memo dated 20.11.2009. Complainant has additionally alleged that after dishonour of the cheque in question legal demand notice dated 27.11.2009 was served on accused who duly replied to the same but still failed to pay the cheque amount. It is thus, alleged that the accused thereby committed the offence punishable under section 138 N.I. Act.
12. Ld. Counsel for complainant argued that complainant has proved beyond reasonable doubt all the ingredients of the offence punishable under Section 138 NI Act and the rebuttal evidence led by accused is too weak to have even reached the mark of preponderance of probability, for disproving the complainant's claim. The arguments of Ld. Counsel for complainant were rebutted by the Ld. Counsel for the accused, who argued in favour of acquittal of accused, citing the complainant's case CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 8 to be a false one. The arguments advanced by the Ld. counsel for accused are dealt with in the course of this judgment.
13. Having recounted the case of complainant hereinabove, at the inception it is pertinent to record that the accused has fairly admitted his signature on the cheque in question and has also admitted that the cheque in question belongs to his bank, in his cross examination conducted by the learned counsel for complainant. In addition to this, in the reply/plea of defence to the notice framed against him on 06.01.2012 in terms of Section 251 Cr.P.C., he admitted his liability towards the complainant for a sum of Rs. 3 lacs against the claimed liability of Rs. 5 lacs i.e. the cheque amount. However, to controvert the complainant's claim the accused flagged a series of defence points, like his liability to pay does not arise on account of the Bolero vehicle purchased by him having been duly hypothecated to the ICICI Bank, secondly, misuse of cheque in question by complainant and lastly, payment of balance consideration amount to complainant over and above the down payment of Rs.1,05,000/ initially made by him.
14. This being the factual position, it is deem fit to enumerate what all necessary ingredients were required to be proved by the complainant for establishing the guilt of the accused under Section 138 NI Act. The said ingredients are as under:
(a) The accused issued cheque on an account maintained by him with a bank.
(b) The said cheque had been issued in discharge of either the whole or part of any legal debt or other liability.
(c) The cheque has been presented to the bank within the period of three months from the date on which it was drawn or within the period of its CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 9 validity.
(d) When the aforesaid cheque was presented for encashment, the same was returned unpaid/dishonoured either because of funds being insufficient in the account of the drawer of cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank.
(e) The payee of the cheque issued a legal notice of demand within 30 days from the receipt of information by him from the bank regarding the return of the cheque.
(f) The drawer of the cheque failed to make the payment within 15 days of the receipt of the aforesaid legal notice of demand.
It is settled that if the aforesaid ingredients are satisfied then the drawer of the cheque shall be deemed to have committed an offence punishable u/s. 138 of the Negotiable Instruments Act, 1881.
15. Further, it is a wellestablished legal position, that in case of dishonor of a cheque, as soon as the accused admits his signature on the cheque in question and admits that the said cheque belongs to his bank account, then two statutory presumptions under Sections 118(a) and Section 139 of the NI Act, arise in favour of the holder of the cheque. These two presumptions give an impetus to the complainant's case, by giving rise to the presumptions that unless the contrary is proved, it shall be presumed that cheque in question was made or drawn for a consideration and that the holder of the cheque received the cheque in question in discharge of whole or part of legal debt or liability owed to him by the drawer. It is CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 10 furthermore settled that both these presumptions are rebuttable in nature as is settled by plethora of decisions of Hon'ble superior courts, which position gets elucidated when the abovementioned provisions are read in conjunction with Sections 3 and 4 of the Indian Evidence Act,1872. In Bharat Barrel & Drum Manufacturing Company v. Amin Chand Payrelal [(1999)3 SCC 35], the Hon'ble Supreme Court discussed about the nature and scope of presumptions under the NI Act and also discussed about they being rebuttable in nature in the following words:
"Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by consideration. Such a presumption is rebuttable. The defendant can prove the nonexistence of consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies."
Further in M/s Kumar Exports v. M/s Sharma Carpets, (Decided on 16 December, 2008), the Hon'ble Supreme Court explained how and in what circumstances do the presumptions come into play in a trial in a cheque bounce case. It observed:
"10. ... As soon as the complainant discharges the burden to prove that the instrument, say a note, was executed by the accused, the rules of presumptions under Sections 118 and 139 of the Act help him shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 11 discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists.
11. The use of the phrase "until the contrary is proved" in Section 118 of the Act and use of the words "unless the contrary is proved" in Section 139 of the Act read with definitions of "may presume" and "shall presume" as given in Section 4 of the Evidence Act, makes it at once clear that presumptions to be raised under both the provisions are rebuttable. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over."
Further with regard to the standard of proof required to dispel/rebut the said statutory presumptions discussed above, in Kumar Exports (supra), the Hon'ble Court further observed:
The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the nonexistence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as 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 nonexistence 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 is probable has to be brought on record for getting the burden of proof shifted to the complainant."
CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 12 In the case of M.S. Narayana Menon alias Mani v. State of Kerala and Anr. [(2006) 6 SCC 39] also the Hon'ble Supreme Court discussed about the standard of proof required to rebut the statutory presumption in the following manner:
"This Court clearly laid down the law that standard of proof in discharge of the burden in terms of Section 139 of the Act being of preponderance of a probability, the inference therefore can be drawn not only from the materials brought on record but also from the reference to the circumstances upon which the accused relies upon. Categorically stating that the burden of proof on accused is not as high as that of the prosecution, it was held; Presumption drawn under a statute has only an evidentiary value. Presumptions are raised in terms of the Evidence Act. Presumption drawn in respect of one fact may be an evidence even for the purpose of drawing presumption under another. "
16. Having ruminated on the settled legal position, it is observed that in the present case, the accused having admitted his signature on the cheque in question alongwith the admission that the cheque in question belonged to his bank account, the statutory presumptions under Section 118(a) and 139 NI Act, began to operate in favour of complainant, being the holder of the cheque in question. This shifted the onus over to the accused to rebut these presumptions.
17. The accused in his rebuttal evidence, has primarily highlighted three points of defence to disprove the statutory presumptions above mentioned. Ld. Counsel for accused stated that at the outset, it is worthy to pay attention to the fact that when the deal for purchase of Bolero car was finalized between the complainant and accused, complainant's sales manager/employee Shri R.K Chug had himself arranged for the sanction of car loan for the accused from ICICI Bank. He stated that CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 13 Shri R.K. Chug had made the accused sign five blank cheques alongwith a loan file and the said cheques were handed over to the ICICI Bank which exercise, finally culminated in due hypothecation of the car to the ICICI bank, pursuant to the grant of car loan in favour of accused. Ld. Counsel argued that when the car loan was sanctioned for the purchase of car on behalf of accused, there neither was any reason nor occasion for the accused to issue the cheque in question to complainant, for payment of consideration of the vehicle as the balance consideration amount had already been received by complainant. Furthermore, it was pointed out by him that the hypothecation of vehicle is even duly reflected on the Certificate of Registration proved as Ex.CW1/D2 and document of Insurance proved as Ex.CW1/D1, of the vehicle which was also handed over to the accused by Shri R.K. Chug. He stated that therefore, since the complainant had already received the balance consideration amount of vehicle from ICICI Bank, apart from the down payment made by accused, the accused does not owe any lawful debt/liability to the complainant. Hence the present complaint to claim the remaining consideration amount of vehicle in question is filed solely to harass the accused. He further contended that the second defence of accused is that the cheque in question, alongwith four other cheques bearing no.341908, 341909, 341910 and 341911, was in fact handed over as security cheque to the ICICI Bank being part of the abovestated series of cheques, was also given to the bank and it was never issued to the complainant for discharge of any debt or liability towards the complainant. He thus stated, that the cheque in question has been misused by complainant. Ld. Counsel additionally pointed out that the accused has already paid the entire consideration amount of Bolero car, so the accused is not liable to pay the cheque amount and present complaint is nothing but an abuse of the process of law, being not maintainable.
18. In order to appreciate the defences raised by accused, in the correct CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 14 perspective and to fairly understand the extent to which accused has been able to rebut the presumptions, an attempt will be made hereunder, to deal with each point of defence raised by accused, individually.
19. At the outset, it is worthy to note that the transaction of purchase of Bolero vehicle is not in dispute between the parties. It is also not in dispute that the vehicle was handed over to the accused on 13/09/2008 after receiving down payment of Rs.1,05,000/, but the trouble virtually commenced from this stage, onwards. The accused alleges that the entire dealing for purchase of the vehicle was discussed with and managed by the sales manager of complainant Sh. Raj Kapoor Chug, who got all the loan documents and five blank cheques signed from accused and later on even informed the accused about the sanction of his loan and even went up to the extent of handing over of the registration certificate and insurance of vehicle, which duly reflected the hypothecation of the said vehicle to the ICICI bank. The first point of defence of accused thus is, that the Bolero vehicle having been duly hypothecated to the bank and the complainant being the dealer of the vehicle from whom it was purchased and by whom the car loan was also arranged, the complainant had already received the balance sale price of vehicle from the bank itself. So the complainant neither was nor is entitled to claim the remaining consideration from the accused by way of the cheque in question. For proving this defence, accused led both oral and documentary evidence. But from an overall evaluation of the evidence led by accused, it is sufficiently clear that this defece of accused is totally farce and frivolous as it has surfaced in the crossexamination of accused that he was aware of nonsanction of car loan in respect of the Bolero vehicle by the ICICI Bank from the inception of present proceedings. This fact has been duly admitted by the accused in his crossexamination where he states that he came to know that the vehicle was not hypothecated in the year 2009, itself. This fact is even corroborated by the CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 15 document proved in evidence i.e. a Letter/ No Objection Certificate proved as Ex.DW1/B(OSR) dated 13/04/2015, proved in evidence by defence witness DW1, One official from the Transport Department which established that ICICI Bank had not provided finance for the purchase of the Bolero vehicle having registration no. DL8CNA2107 and the letter further clarified that the bank did not have any objection in removal of hypothecation from the registration book of the said vehicle. Hence the defence of accused came crumbling down by his own evidence which was totally contrary to the initial stance taken by him. It thus become clear that in the year 2009 itself, the accused came to know that the Bolero vehicle purchased by him was not hypothecated to ICICI bank, meaning thereby, that he had been using the vehicle intentionally without paying the complete consideration amount of it.
20. Ld. Counsel for accused argued that the accused has deposed that initially the car loan was sanctioned but later on it was found out that it was not sanctioned. This argument is totally misconceived as it has been proved on record beyond all reasonable doubt that the Bolero car was never hypothecated to bank and the accused despite being aware this fact, raised a frivolous defence in this case. However, the accused could have summoned witnesses from the ICICI bank to prove his defence and could also have brought in evidence his bank statements for proving payment of EMIs of the car loan by him. But he has failed to lead evidence of this nature.
21. Further for proving the defence, the best evidence would have been of the Sales manager Sh. R.K. Chug, but he was not summoned as witness by accused. During arguments, Ld. Counsel for accused argued that the factum of hypothecation is not even denied by CW1, power of attorney holder of complainant Rajesh Sanghi, CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 16 so it ought to be believed that the vehicle was hypothecated. In my opinion, even if the factum of hypothecation is admitted by CW1, but the document proved as Ex.DW1/B which is the letter/ No Objection Certificate would be preferred over the oral testimony of CW1 to answer the dispute. Moreover in my opinion, it was the responsibility of the accused to prove his defence which onus cannot be discharged by simply relying on a vague admission by the complainant. It is no doubt true that for rebutting the complainant's case, the accused can place reliance on the evidence led by complainant too, but this does not divest him of his responsibility of proving his defence individually and separately at the stage of defence evidence. He could have used the loopholes in complainant's evidence for corroboration of his defence but could not entirely rely on the admission of CW1. Hence in my opinion it has cogently been proved in evidence by EXDW1/B that there was no car loan sanctioned in favour of accused by ICICI Bank and the complainant being the seller of the Bolero vehicle did not receive the balance sale consideration of the vehicle. The defence raised of accused is thus baseless without merit and does not rebut the presumption raised in favour of complainant.
22. Equally meritless was the second defence raised by accused, where he stated that the cheque in question has been misused by the complainant as it was handed over to ICICI Bank alongwith four other cheques for obtaining car loan and denied issuing the same to the complainant. To buttress this submission, he himself stepped in the witness box in addition to proving on record a copy of FIR dated 24/09/2012 which was got registered by the accused against the complainant and the employee/sales manager of complainant Sh. Raj Kapoor Chug. The said copy of FIR is proved in evidence of accused as Mark X. Apart from this, there is no other evidence led by accused. Having gone through the testimony of accused DW2 and the copy of FIR proved by him, I am of the opinion that even this defence is CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 17 meritless and baseless because the accused has time and again changed his stand with regard to, whom he had handed over the signed cheques. In his cross examination, he has deposed that the cheque in question was handed over to the ICICI Bank at Rohini for car loan and even showed his ignorance about how the cheque in question came in possession of complainant. However, contradicting his own version, in the copy of FIR proved by him, it is clearly stated that the cheque in question alongwith the other cheques were handed over to Raj Kapoor Chug by accused himself. So this unsteady and contradictory versions, prove the falsity and frivolous nature of his defence. Accused ought to have cogently proved how the cheque in question was misused by the complainant and how it was not issued to the complainant for discharge of his liability by accused, as it is settled that mere bald assertions cannot by themselves be a substitute for concrete proof required to rebut the statutory presumptions. Although he has alleged that the cheques were handed over for sanction of car loan, but it has been shown in the earlier part of this judgment, that the car loan was never sanctioned in his favour by ICICI Bank. In a recent decision pronounced by the Hon'ble Supreme Court in Bir Singh v. Mukesh Kumar, (Decided on 6th February, 2019), it was observed:
"37. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted.
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence."
CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 18
23. Thus there lies no substance even in the second defence raised by accused and the same stands rejected. The defence of misuse of cheque in question by complainant, stands disproved further by the fact that the accused got registered the FIR against complainant and the sales manager of complainant Raj Kapoor Chug, in the year 2012 i.e. two years after the filing of complaint under Section 138 NI Act by complainant. Accused has admitted that he realized that his cheque had been misused by complainant only after receiving the legal notice from complainant. Legal notice dated 27/11/2009 was admittedly received by accused in the month of November, 2009, FIR was got registered only after three years i.e. in the year 2012. The lack of bona fide in his defence is axiomatic from the subsequent conduct of accused that he did not take prompt action against the alleged misuse of the cheque in question. Further, accused failed to either name or summon any official from ICICI Bank in his rebuttal evidence to prove handing over of cheque in question to the bank. Hence, there lies no merit or strength in the argument raised by accused which is rejected for the reasons, abovestated.
24. Coming now to the third line of defence raised by accused which is that the entire consideration/ purchase price of the Bolero car has already been paid to complainant, hence accused does not owe any liability to complainant. To narrow down the controversy, it be noted that complainant has admitted receipt of a sum of Rs.1,05,000/ proved by his Ledger Account statement Ex.CW1/3. Accused has alleged that over and above, Rs.1,05,000/ he has paid Rs.2.5 lacs to the Sales Manager of complainant Sh. Raj Kapoor Chug besides depositing the insurance amount of the vehicle by way of cheque issued for a sum of Rs.21,872/ and Rs.40,000/ as registration charges of the vehicle. During arguments Ld. Counsel for accused contended that accused is not liable to pay the cheque amount to CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 19 complainant clearly in view of the fact that he has already paid the entire consideration and the present proceedings are ex facie malafidely instituted against the accused.
25. In order to establish the defence raised, the accused has only examined himself as DW2. Admittedly, he has neither examined any other person who could be a witness to the alleged various payments made by him to complainant, nor has he furnished any documentary evidence of those payments. The Hon'ble Supreme Court in M/S Kumar Exports vs M/S Sharma Carpets, (Decided on 16 December, 2008) observed:
"11... 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 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 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 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 circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on to the complainant."
26. Thus barring bare denial, accused did not lead any cogent evidence to disprove his liability. Other than this, from an overall analysis of the reply to the notice given by him on 05.12.2009, his examination in chief and his cross examination, it is revealed that he has altered his stand at each level. In reply to the CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 20 notice, he admitted his liability for a sum of Rs.3 lacs towards the complainant, but in his examinationinchief he has deposed that no liability is owed to complainant as he has already paid Rs.2.5 lacs besides the registration charges and the insurance of vehicle. Again changing his version in the crossexamination, he stated that he had paid Rs.2 lacs in the year 2008 and Rs. 2 lacs in the year 2009, besides the insurance and registration charges. It is reiterated that he has not led documentary evidence to prove any of the abovestated payments. Thereafter, once again changing his stance, he stated that he has paid a total sum of Rs.3,11,872/ to complainant. Hence the third defence raised by accused too has failed to rebut the presumptions raised in favour of complainant. So, the constant change of stand by the accused regarding payment of the entire consideration amount, only indicates towards his mala fide and deliberate attempt to deprive the complainant of the cheque amount.
27. Lastly, but most importantly, this is a completely contradictory stand, which contradicts this first defence, where he has alleged that the car loan having been sanctioned in favour of the Bolero vehicle, the complainant has already received the entire consideration amount. If the complainant had already received the entire consideration amount, then there would not have been any occasion for accused to make further payments to complainant. Thus even the final defence of accused has failed to rebut the presumption raised in favour of complainant. The record therefore, shows that complainant has successfully proved that the cheque in question was issued by accused to complainant in discharge of his liability to pay the purchase price of the vehicle, which got dishonoured and the intimation was sent by return memo dated 20.11.2009 proved as EX.CW1/7 to complainant. The complainant has proved the issue of a valid legal demand notice Ex.CW1/8 wherein demand of the cheque amount was made by complainant to the accused and the CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh 21 reply to the legal demand notice proved as Ex.CW1/11, shows that despite having received the legal demand notice from the complainant, the accused failed to pay the cheque amount within 15 days from the receipt of the demand notice. This renders all the ingredients under Section 138 NI Act, to be proved beyond reasonable doubt. The accused Mahavir Singh is accordingly, convicted in the present case u/s 138 of the Negotiable Instruments Act.
Digitally signed by NEETI NEETI SURI
SURI MISHRA
Date: 2019.05.13
MISHRA 17:36:26 +0530
Pronounced in open court (NEETI SURI MISHRA)
on 29.04.2019 MM02 (Central): Tis Hazari Courts
Courts:Delhi:/29.04.2019
(This Judgment contains 21 pages and
all pages are signed by me)
CIS No .534102/16, PS. Pahar Ganj Rajesh Sanghi v. Mahavir Singh