Delhi District Court
Dharmender Sahni vs M/S Atul Vatika Developers Pvt Ltd on 23 September, 2024
DLST020042542020
Presented on : 14.02.2020
Registered on : 17.02.2020
Decided on : 23.09.2024
Decision : Convicted
IN THE COURT OF
JUDICIAL MAGISTRATE FIRST CLASS (NI ACT) - 03
AT SOUTH, SAKET DISTRICT COURT
(PRESIDED OVER BY SHRI KAWAL SINGH)
CT Cases/3631/2020
CNR NO.DLST 02-004254-2020
JUDGMENT
DHARMENDER SAHNI son of Mr.Shiv Nath r/o H-2 Block, Behind DDA Flat, Madangir, Ambedkar Nagar, New Delhi. .............. Complainant VERSUS
1. SURENDER CHAUHAN son of Mr.Jagdish Chauhan Director of M/s Atul Vatika Developers Pvt. Ltd. r/o 308, Maidan Garhi, Delhi Also At A-50, First Floor, Pancheel Vihar, New Delhi. .......... Accused no.1 CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.1 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:34:13 +0530
2.M/S ATUL VATIKA DEVELOPERS PVT. LTD. through its Director Mr.Surender Chauhan 308, Maidan Garhi, Delhi Also At A-50, First Floor, Pancheel Vihar, New Delhi.
.............. Accused no.2 Offence punishable under section 138 of Negotiable Instruments Act, 1881 STATEMENT IN BRIEF OF THE DECISION WITH REASONS FACTUAL MATRIX
1. The instant proceeding has originated out of a complaint preferred by Mr.Dharmender Sahni (complainant) against Mr.Surender Chauhan (accused no.1) and his company M/s Atul Vatika Developers Pvt. Ltd. (accused no.2) for the offence under section 138, Negotiable Instruments Act, 1881 (hereinafter referred to as "NI Act").
2. A succinct account of the facts in the complaint is that, accused no.1 claimed to be a builder and developer and doing business of Real Estate. That the complainant had approached the accused no.1 to buy one property for residential purpose i.e. 55 Square Yard at D-1, 3rd Floor, Village Neb Sarai, New Delhi and the accused no.1 assured to handed over the possession of the said CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.2 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:34:29 +0530 property to the complainant very soon. That to which a written agreement to sell has been executed between the accused and the complainant on 20.12.2017 in which the total sale consideration had to be settled at Rs.15,75,000/- out of which Rs.3,01,000/- had been given by the complainant to the accused in two installments i.e. Rs.2,51,000/- through NEFT and Rs.50,000/- in cash. That after the period of six months, the complainant approached to the accused no.1 to take over the possession of the said property but the accused no. 1 had told him that due to some financial problem the construction on the said property could not be started and it will start within one or two months. That in the month of February 2019, the complainant again visited the site of the said property but the status of the said property was the same in December 2017 and the accused promised to return the money without interest to in the near future. That in view of the aforesaid liability, the accused no.1 had issued cheque bearing number 000310 of accused no.2 dated 05.10.2019 for a sum of Rs.3,01,000/- drawn on Kotak Mahindra Bank, New Delhi (hereinafter referred to as the "cheque in question").
3. When the complainant presented the cheque in question for encashment, the same was returned unpaid upon presentation for the reason 'funds insufficient' vide return memo dated 30.12.2019.
CT Cases 3631/2020Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.3 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:34:44 +0530 A legal demand notice dated 16.01.2020 was sent by the complainant to the accused no.1 and accused no.2 in this regard, but to no avail as the accused persons failed to pay the cheque amount within the prescribed period. Hence, the present complaint under Section 138 of NI Act was filed.
APPEARANCE OF ACCUSED AND TRIAL
4. The accused no. 1 had entered appearance in response to summons on 14.03.2023. Notice of accusation under Section 251, Code of Criminal Procedure, 1973 (hereinafter referred to as "Cr.P.C.") was served upon accused persons to which the accused no.1 pleaded not guilty and claimed trial. Thus, his plea of defence was recorded. The accused no.1 admitted his signature on the cheque in question and filling all the particulars of it. Accused no.1 also deposed that the complainant booked a flat with his company and paid Rs.3.01,000/- to him. Accused no.1 further deposed that he had already repaid an amount of Rs.2.5 lakhs back to the complainant and he is wiling to pay an amount of Rs.51,000/- back to the complainant.
5. The complainant was cross-examined after allowing the application under Section 145 (2) of NI Act and cross examined the complainant. Further, statement of accused persons under Section 313 Cr.P.C. was recorded, wherein the incriminating CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.4 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:35:02 +0530 evidence were denied by accused no.1. The accused no.1 deposed that he had issued the cheque in question as post dated cheque (PDC) to the complainant and paid Rs.2.5 lakhs before presentment of the cheque in question to the complainant in cash to the complainant.
EVIDENCE LED BY THE COMPLAINANT
6. To support its case, the complainant was examined two witnesses as complainant himself and CW-2 Mr.Rahul, Assistant Manager.
7. CW-1 (complainant) himself tendered his evidence by way of affidavit and documentary evidence led by the complainant:
Ex.CW1/1 : Evidence by way of affidavit.
Mark CW1/A : Agreement to Sell
Ex.CW1/B : Bank Account Statement.
Ex.CW1/C : Cheque in question.
Ex.CW1/D : Return Memo
Ex.CW1/E : Legal Notice
Ex.CW1/F : Courier report
Ex.CW1/G : Tracking receipt.
8. CW-2 Mr.Rahul Assistant Manager had tendered his evidence and exhibited the documents i.e. Ex.CW2/1 (colly).CT Cases 3631/2020
Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.5 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:35:12 +0530 EVIDENCE LED BY THE ACCUSED
9. On the other hand, the accused persons had examined one defence witness i.e. Mr.Prakash Chauhan as DW-1 who deposed that accused no.1 had given a sum of Rs.2.5 lakhs in cash to Mr.Vinod Sahni and then the accused had asked Mr.Vinod Sahani to return his cheques and agreement. DW-1 again deposed that it was Mr.Dharmender Sahni and not Mr.Vinod Sahni.
10. Past that, the matter was fixed for final arguments.
ARGUMENTS
11. Counsel for the complainant has stated that the accused no.1 being the director of company accused no.2, was doing the business of Real estate and had shown one property located at Neb Sarai, New Delhi, which was claimed to be in his possession. Counsel for the complainant contended that the accused no. 1 promised that the property to be handed over the complainant after construction, for which an agreement to sell was also executed dated 20.12.2017.
The counsel for the complainant further submitted that the total sale consideration was of Rs. 15,75,000/- out of which Rs. 3,01,000/- was transferred to the accused persons by the complainant towards part payment and remaining balance was to be paid after handing over the possession of the property to the complainant for which sale deed is to be executed by the accused.
CT Cases 3631/2020Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.6 of 18 KAWAL SINGH Digitally signed by KAWAL SINGH Date: 2024.09.23 15:35:23 +0530 The counsel for the complainant had argued that the accused persons failed to fulfill their obligations under the agreement to sell citing some financial losses and to return the partial consideration amount, the accused persons had issued the cheque in question of Rs. 3,01,000/-, which was dishonoured, for which the accused had received the legal demand notice which was never replied to or paid back the amount due within fifteen days of its receipt.
12. In view of above, all the requirements of section 138 NI Act of being met with in the present case. Hence, the accused persons be convicted.
13. Counsel for the accused persons had, on the other side argued that the complainant has filed a false and fabricated case against the accused persons as the cheque in question was given for security purpose, which was to be returned on making the payment. Counsel for the accused persons contended that the complainant was returned a sum of Rs. 2,50,000/- in presence of Mr. Rahul Chikara and Mr. Prakash Chauhan but the complainant had still presented the post dated cheque given to him. The counsel for the accused argued that the accused persons are willing to pay the CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.7 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:35:35 +0530 balance of Rs. 51,000/- to complainant if his cheque is returned back to him. Counsel for the accused persons argued that the cheque in question was not issued to discharge any legal liability as alleged by the complainant and the same has been misused. Hence, the present case deserves to be dismissed.
POINTS OF DETERMINATION
14. The following points of determination arise in the present case.
1. Whether the complainant has been successful in raising the presumptions under Section 118 read with Section 139 of NI Act.
2. If yes, whether the accused no.1 and accused no.2 have been successful in raising a probable defence?
THE LAW APPLICABLE
15. On perusal of record, and after giving my thoughtful consideration to the final submission of the parties. This court would like to narrate the legal principles relevant for adjudication of complaint under section 138 of NI act briefly, before appreciating the evidence led on behalf of both the parties.
16. The Hon'ble Supreme Court of India in Basalingappa v.
Mudibasappa, 2020 SCC OnLine SC 491 at page 422 held as follows:
(i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.CT Cases 3631/2020
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(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open for the accused to rely on evidence led by her or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
(iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.
17. The three-judge bench of the Hon'ble Supreme Court in Rangappa v. S. Mohan, (2010) 11 SCC 441 has ruled that existence of liability itself is a presumption of law. It held as under:
"26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability."
18. The Hon'ble Supreme Court of India in C.C. Alavi Haji v.
Palapetty Muhammed, (2007) 3 SCC (Cri) 236 at page 565 held as follows:
"A person who does not pay within 15 days of receipt of the summons from the court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.9 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:35:59 +0530 138, by ignoring statutory presumption to the contrary under Section 27 of the GC Act and Section 114 of the Evidence Act."
FINDINGS AND REASONING POINT OF DETERMINATION NO. 1:
19. It is not in dispute that the cheque in question was drawn on account maintained by the accused no.2 and was signed by the accused no.1. The reason for dishonour of cheque in question as mentioned in cheque return memo Ex.CW1/D is "funds insufficient". The return memo bearing stamped by the concerned bank, the presumption of dishonour under section 146, NI Act arises. The receipt of legal demand notice Ex.CW1/E has not been admitted by the accused no.1 but the address on which it was sent has been admitted by the accused no.1 as the correct address of the accused no.2. Legal demand notice being properly addressed and sent, gives way to the presumption under section 114 of Indian Evidence Act and Section 27 of the General Clauses Act that the legal notice has been received by the accused in light of the pronouncement CC Alavi (Supra). No evidence was led to rebut the aforesaid presumption on behalf of the accused persons save mere denial of the accused no.1. Also, it is nobody's case that the accused no.1 tendered the amount entailed in the cheque in question upon entering appearance before this court in response to CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.10 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:36:08 +0530 the summons issued in the instant case. The plea of the accused persons regarding non-receipt of legal notice is accordingly rejected, as being inconsequential.
20. The ingredients necessary for raising the statutory presumptions being fulfilled, the presumptions under section 139 and 118, NI Act that cheque in question was issued for a legally recoverable debt/liability stands activated.
21. Accordingly, the point of determination no.1 is decided in the affirmative.
POINT OF DETERMINATION NO. 2:
22. Now it is to be examined whether the accused no.1 and accused no.2 have been able to rebut the statutory presumptions.
23. The case of the complainant is that the cheque in question for a sum of Rs. 3,01,000/-, was issued towards the repayment of the sale consideration, as the accused persons had failed to fulfill their part of obligation to hand over the possession of the property after completion of construction. To establish its case the complainant has placed on record the agreement to sell Mark CW1/A, bank CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.11 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:36:17 +0530 account statement Mark CW1/B, cheque of accused no.2 Ex.CW1/C, return memo of the dishonoured cheque Ex.CW1/D and legal demand notice Ex.CW1/E with tracking report Ex.CW1/G.
24. The complainant was cross examined by the counsel of the accused persons. Therein, it had emerged that the complainant was shown a sample flat by the accused no.1 and the property sold was located in Neb Sarai, New Delhi. The complainant testified that he had sent the legal demand notice to the address of the accused no.1 located in Malviya Nagar and denied receiving any money in the presence of Mr. Rahul Chikara or Mr. Prakash Chauhan.
25. The complainant also examined the bank official from his bank who had placed on record his bank account statement for period 01.11.2017 to 31.12.2017 as Ex.CW2/1(colly).
26. To lead their evidence, the accused persons got Mr. Prakash Chauhan examined as DW-1 who stated that the accused no.1 had given Rs. 2,50,000/- in cash to Mr. Vinod Sahani initially and then corrected the same to Mr. Dharmender Sahani i.e., the complainant. In his cross-examination DW-1 admitted that he had CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.12 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:36:25 +0530 not counted the money given to the complainant by the accused no.1 but stated that the same was given in the denomination of Rs. 500/- notes after the same was brought by the driver of the accused no.1. The witness had denied all the questions suggesting that he was deposing before the court at the instance of the accused persons and no such money transaction was witnessed by him as the same was never given.
27. It is not in dispute that agreement to sell Mark CW1/A was executed between the accused no.1 and the complainant for which a sum of Rs. 3,01,000/- was received by the accused no.1. The accused no.1 had also admitted his signatures on the cheque in question drawn on the account maintained by the accused no.2 which was also issued to the complainant. The only disputed facts in the present case is the purpose for which the cheque in question was issued and the repayment of around Rs. 2,50,000/- back to the complainant.
28. The primary defence of the accused persons is that the cheque in question was given as a post dated cheque but the same was to returned back as he had repaid around Rs. 2.5 lakhs in cash at the office of the complainant. The accused no.1 alleged that the same CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.13 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:36:34 +0530 was returned in presence of witnesses Mr. Prakash Chauhan and Mr. Rahul Chikara after which the complainant had also returned the original of agreement to sell. The accused no.1 contended that he had not returned the balance amount of Rs.51,000/- back because the complainant did not returned his PDC. To prove this the accused persons got examined DW-1 who had allegedly witnessed the transaction where the accused no.1 had returned Rs. 2.5 lakhs back to the complainant at his office.
29. Perusal of the testimony shows that DW-1 is known to accused no.1 for the last 10-12 years and had seen the accused no.1 arguing with the complainant over some cheques, where a sum of Rs. 2.5 lakhs was given to the complainant. However, it is interesting to note that DW-1 had himself testified initially that the argument was with one Mr. Vinod Sahani and then the money was also given by the accused no.1 to Mr. Vinod Sahani. But later realising his mistake he had candidly changed his testimony by substituting Mr. Dharmender Sahani i.e., the complainant instead of Mr. Vinod Sahani. All this creates suspicion over the testimony of witness DW-1. The counsel for the complainant had also questioned the authenticity of testimony of DW-1 as he is a close friend of the accused no.1 and on being biased towards the CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.14 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
2024.09.23 15:36:43 +0530 accused no.1, he is deposing to favour the accused.
30. It is well settled in law that the evidence of a witness cannot be discarded merely on the ground that he or she is a related or interested witness. However, it is also well settled in rule of prudence that the evidence of a related or interested witness should be examined very meticulously. The entire defence evidence will be examined based on the testimony of all the witnesses including interested witnesses along with other evidence on the record.
31. The testimony of DW-1 shows that the witness himself is not certain about the identity of the individuals among whom the alleged transaction took place, even if it is to be presumed that the same had actually occurred. Further the accused persons had also not put on record any reliable evidence to corroborate the testimony of the witness. For instance no original of agreement to sell Mark CW1/1 was even filed to substantiate his defence that the same was returned to him when he had allegedly returned Rs. 2.5 lakhs back to the complainant. Hence, the testimony of DW-1 is rejected as it neither inspires confidence nor corroborates the defence of the accused persons in view foregoing observations.
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32. The other defence of the accused persons is that the legal demand notice Ex.CW1/E was never received by the accused no.1 as the address on which it was sent is the incorrect address of the accused no.1. The accused no.1 argued that his house number is "A-49" and not "A-50" on which the legal demand notice was dispatched by the complainant. It is a well settled law as discussed in CC Alavi (Supra) that to prove the service of delivery of the legal demand notice complaint must contain basic facts regarding the mode and manner of the issuance of notice to the drawer of the cheque. It is for the drawer to rebut the presumption about the service of notice and show that he had no knowledge that the notice was brought to his address or that the address mentioned on the cover was incorrect or that the letter was never tendered or that the report of the postman was incorrect. Here in the present case the complainant had dispatched the legal demand notice addressed to both accused no.1 and accused no.2 as seen from the postal receipts Ex.CW1/F as well as the tracking reports Ex.CW1/F. The accused persons had not led any documentary evidence for instance his residential proof ID or examined any reliable witness to prove his plea of incorrect address and had barely averred orally that the legal demand notice was never sent to his correct address thus, he had no knowledge of the same.CT Cases 3631/2020
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33. In view of above, the contention of the accused persons qua absence of legal debt/ liability and non-receipt of legal demand notice, the defence of the accused persons stands not proved as it is only by way of mere/bare denial and therefore, have failed to probabilise their defence. Also, nothing has been shown that accused no.1 was not acting on behalf of the company accused no.2 being incharge of its affairs as its director.
34. On the other hand, this court finds that the complainant has proved his version by way of consistent and reliable oral testimony as well as documentary evidence.
35. Accordingly, in light of the aforesaid discussion, the point of determination no.2 is decided in the negative.
VERDICT
36. In view of the foregoing discussion, this court holds that complainant has established its case beyond reasonable doubt by proving all the ingredients under Section 138 NI Act by leading cogent evidence and the accused persons have failed to raise a probable defence.CT Cases 3631/2020
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37. Accordingly, accused no.1 and accused no.2 are hereby convicted for offence punishable under Section 138 NI Act qua the cheque in question in the present case.
38. Let the convicts be heard separately on quantum of sentence.
Copy of this judgment be given free of cost to the convict.
Announced in the Open Court on this 23rd September 2024. This Judgment consists of 18 signed pages.
(KAWAL SINGH) Metropolitan Magistrate-03 (South), NI Act Saket/New Delhi/23.09.2024 CT Cases 3631/2020 Dharmender Sahini v. M/s Atul Vatika Develpers Pvt. Ltd. & Ors Page No.18 of 18 Digitally signed by KAWAL KAWAL SINGH SINGH Date:
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