Delhi District Court
Leela Devi vs . Deepak Madan on 8 June, 2023
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.: 400/2020
CNR NO.: DLND02-000276-2020
Leela Devi
W/o Sh. Devender Singh,
NDMC Flat no.3, Basurkar Market
Moti Bagh, New Delhi-110023.
......Complainant
versus
Deepak Madan
S/o Sh. Prakash Chander Madan,
A-103, New Town Heights, Sector-91,
Gurugram, Haryana.
........Accused
JUDGEMENT
Date of Institution of Complaint : 07.01.2020 Police Station : Chanakyapuri Offence Complained of : u/s. 138 of NI Act Plea of Accused : Not Guilty Date of Final Arguments Heard : 30.05.2023 Decision Qua Accused : Acquitted Date of Decision : 08.06.2023 BRIEF STATEMENT OF REASONS FOR DECISION
1. Vide this judgement, I shall decide the present complaint filed u/s. 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the NI Act) filed by the complainant against the accused on account of dishonour of cheque bearing Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 1 of 16 no.004354 dated 16.11.2019 for a sum of Rs.10,00,000/- drawn on ICICI Bank allegedly issued by the accused in favour of the complainant (hereinafter referred to as the cheque in question).
CASE OF THE COMPLAINANT
2. Brief facts of the case as per the complaint are that accused was a family friend of the complainant. It is further stated that accused approached the complainant and requested for a friendly loan for a sum of Rs.10,00,000/- in the first week of May, 2018. It is further stated that complainant had given the said loan to the accused in the month of May, 2018 and accused in turn assured the complainant for repayment of the same within a period of one year. It is further stated that the complainant paid Rs.9,00,000/- through cheque on 05.05.2018 and remaining Rs.1,00,000/- in cash. It is further stated that after one year, the accused issued the cheque in question as a post dated cheque and assured that the cheque in question will be honoured on presentation.
3. It is further stated that on presentation, the cheque in question was returned dishonoured with remarks "Drawers signature differs" vide cheque return memo dated 20.11.2019. That thereafter, a legal notice was sent to the accused dated 11.12.2019 and since no payment was made within 15 days of the service of legal notice, then the present case has been filed.
4. In support of the case of the complainant, Ld. counsel for the complainant has relied on averments made in the complaint, the evidence by way of affidavit filed by the complainant, the presumption of law u/s. 118(a) r/w. 139 of the NI Act and the following documentary evidence:
S. No. Document Exhibit
Leela Devi Vs. Deepak Madan
CC No.400/2020 Page No. 2 of 16
1. Original Cheque in question Ex.CW-1/A
2. Original Bank return memo Ex.CW-1/B
3. Legal demand notice Ex.CW-1/C
4. Postal receipts Ex.CW-1/D (colly)
5. Tracking reports Ex.CW-1/E (colly)
6. Copy of Passbook of the Ex.CW-1/F (colly)
Complainant (OSR)
7. Present complaint Ex.CW-1/1
CASE PROCEEDINGS
5. In the present matter notice of accusation u/s. 138 of the NI Act was served on the accused on 27.10.2021 and the accused pleaded not guilty and claimed trial. The plea of defence of the accused was also recorded by the court on the same day.
6. An application u/s. 145(2) of the NI Act moved on behalf of the accused was allowed vide order dated 16.12.2021 and the accused was granted an opportunity to cross-examine the complainant. The complainant was duly cross-examined and discharged and vide separate statement of the complainant dated 19.02.2022, the post-summoning evidence was closed.
7. Statement of accused u/s. 281 r/w. Section 313 CrPC was recorded on 09.09.2022 and all the incriminating evidence was put to the accused. During statement of the accused u/s 313 CrPC, the accused denied his signatures on the cheque in question. He further denied the fact of having filled any particulars on the cheque in question. He has further stated that he has not received the legal notice and the addresses mentioned on the legal notice are his incorrect addresses. He further stated that he was not having his office at the first given address and he Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 3 of 16 was also not residing at the second address mentioned in the legal notice. He has further stated that he has not given any cheque to the complainant and the cheque has been stolen by the son of the complainant, namely Sh. Nikunj from the dashboard of his car. He has further stated that he has received only Rs. 9,00,000/- from the complainant and he has never received any sum of money in cash from the complainant, particularly he has not received Rs.1,00,000/- from the complainant in cash as stated by her in the complaint. He further stated that he has already repaid Rs. 9,00,000/- to the complainant during the pendency of the present proceedings, Rs.7,00,000/- by online transfer and Rs.2,00,000/- in cash to the husband of the complainant. The accused further denied any legally enforceable debt or liability in favour of the complainant in regard to the cheque in question.
8. Since the accused chose to lead Defence Evidence, matter was fixed for filing of appropriate application u/s. 315 CrPC along with list of witnesses, if required. An application u/s. 315 CrPC filed by the accused seeking permission of this court to examine himself as a witness for the defence was allowed by this court vide order dated 19.11.2022. In support of his defence, the accused has examined five witnesses, namely, Sh. Amit Madan as DW-1, himself as DW-2, Ms. Deepali Madan as DW-3 and Sh. Ghanshyam Pal, Bank Official from ICICI Bank as DW-4. All the witnesses were duly cross-examined by Ld. counsel for the complainant and discharged. Vide separate statement of the accused dated 09.05.2023 the defence evidence was closed and matter was adjourned for final arguments.
9. During defence evidence, the following documents have Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 4 of 16 been placed on record:
S. No. Document Exhibit
1. Proof of online payment of several Ex.DW-1/1 (colly) sums of money
2. Proof of cash payment of Mark DW-1/2 Rs.2,00,000/-
3. Police complaint dated 13.10.2021 Ex.DW-1/3 (colly) and 16.12.2021
4. Account statement of M/s Ex.DW-4/1 (colly) Scienceinsteing Edutech Pvt. Ltd.
bearing account no. 031305000819
10. Final arguments were heard by this court on 30.05.2023.
11. I have heard counsel for the parties, perused the record and have gone through the relevant provisions of the law.
LAW UNDER CONSIDERATION
12. 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;
(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;
Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 5 of 16
(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."
13. Before moving forward with the contentions of the accused, it is pertinent to note that as per the provisions of section 118(a) and 139 of the NI Act, in every case u/s. 138 of NI Act, there is a presumption of law that the cheque has been issued for consideration and in discharge of legally enforceable debt or liability.
14. It is further pertinent to mention the relevant judgments on the point of presumption of existence 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 been held that the presumption u/s. 139 NI Act is a presumption of law and not presumption of fact. It Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 6 of 16 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 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.
15. In the facts of the present case, the signatures on the cheque in question have been denied by the accused in his statement u/s. 313 CrPC and the cheque in question has also been dishonoured for the reasons 'drawers signatures differs'. However, at the stage of serving of notice on the accused and in his statement u/s. 294 CrPC regarding admission/denial of documents, the accused has categorically admitted his signatures on the cheque in question and has also explained the reason as to why the cheque in question has been dishonored with the remarks 'Drawers Signatures Differs'.
16. In view of the above discussion, this court raises presumption u/s. 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.
DEFENCE OF THE ACCUSED
17. For the sake of convenience and brevity, the various defences taken by the accused are listed as follows:-
(a) That the accused has never received the legal demand Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 7 of 16 notice, Ex.CW-1/C from the complainant and hence, the essential ingredients of the offence u/s 138 N.I Act are not made out.
(b) That he had not taken a loan of Rs.10,00,000/- as stated in the complaint and had only taken a loan in the sum of Rs.9,00,000/- by way of online transfer and the same has already been repaid during the pendency of the present proceedings partly by way of online transfer and partly in cash.
FIRST DEFENCE
18. The first defence taken by the accused is that he has never received the legal demand notice, Ex.CW-1/C from the complainant and hence, the essential ingredients of the offence u/s 138 N.I Act are not made out.
19. Ld. Counsel for the accused has submitted that legal demand notice, Ex.CW-1/C, was sent on the incorrect addresses of the accused.
20. Ld. Counsel for the accused has further submitted that the first address allegedly pertains to a company by the name of M/s Scienceinsteing Edutech Pvt. Ltd., and no company master data has been placed on record by the complainant to show that the said address is the registered address of that company. He has further submitted that even no tracking report has been placed in respect of this address to show that the legal demand notice was delivered at this address. He has further submitted that the complainant has not even filed an affidavit to the effect that the legal demand notice was sent on the correct address of the accused.
21. Ld. Counsel for the accused has further drawn the attention of this court towards the cross-examination of the complainant Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 8 of 16 dated 29.07.2022 and particularly the following paragraph:
"....The address mentioned in the passbook was allotted to me by NDMC. The house is at 2nd floor. House no. 54 was at the same floor opposite my house. I changed my residence on 15.05.2018. House no. 54 was empty in May, 2018. I lived at the address mentioned in the passbook for about 17-18 years. I cannot say who used to live in House no. 54. I do not know anyone who used to live at house no. 54. It is correct that house no. 54 can only be allotted to government employees. *** At this stage, the witness is confronted with document Ex-CW1/E and she has stated that the same has not been printed by her. I do not know in whose name the flat at G.K-III as written in the legal notice is registered, Vol. The accused used to reside there......The address of the accused as mentioned in the legal notice was told to me by the accused. It is wrong to suggest that both the addresses mentioned in the legal notice are not the correct addresses of the accused. It is wrong to suggest that legal notice has never been served upon the accused. It is further wrong to suggest that I have given the wrong address of the accused deliberately so that the service of legal demand notice on the accused cannot be effected. It is correct that the accused is not a government employee or employee of NDMC."
22. Ld. counsel for the accused has submitted that the accused has never lived at the second address mentioned in the legal demand notice and that the same does not belong to him.
23. Ld. counsel for the accused has further drawn the attention of this court to the fact that the accused has categorically denied the receipt of the legal demand notice from the complainant in his statement u/s. 313 CrPC and has further stated that the addresses mentioned on the legal demand notice are his incorrect Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 9 of 16 addresses and no proof has been furnished by the complainant for stating that the same are his correct addresses.
24. Ld. counsel for the accused has further submitted that in the complaint the complainant has also stated that the legal demand notice was also sent through WhatsApp and e-mail, however, no proof in this regard has been filed on behalf of the complainant along with the complaint.
25. Ld. counsel for the accused has further submitted that the legal demand notice, Ex.CW-1/C placed on record is an unsigned document and hence, cannot be relied upon by this court. Ld. counsel for the accused has submitted that as accused has never received the legal notice, hence, he has no means of knowing whether the facts mentioned in the notice are true or false, are real or imaginary.
26. Ld. Counsel for the accused in support of his defence has submitted that signature of any document is very vital and absence of signature cannot be considered as a mere technical defect. He has further submitted that without signature the document is incomplete and in the eyes of law may not be a document having legal force. In this regard, reliance has been placed by the accused on several judgments of Hon'ble Supreme Court and Hon'ble High Courts.
27. Per contra, Ld. Counsel for the complainant has submitted that the legal demand notice has been sent on the last known correct addresses of the accused as intimated by him to the complainant and service of legal demand notice is proved from the tracking report placed on record, i.e., Ex.CW-1/E.
28. Ld. Counsel for the complainant has further submitted that Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 10 of 16 the legal demand notice placed on record is merely an office copy and hence, the same has not been signed. He has further submitted that the duly signed copy was already sent by post to the accused.
29. I have heard the rival submissions of both the parties on this point, perused the relevant record of the case and gone through the judgments relied upon by Ld. counsels for the parties.
30. In regard to the objection taken by Ld. counsel for the accused that the copy of legal demand notice, Ex.CW-1/C placed on record is an unsigned copy, I am in agreement with the submissions made on behalf of the complainant and since the copy of the legal demand notice placed on record is an office copy, hence, the complainant could not have placed on record the duly signed copy of the same.
31. In regard to the defence of the accused that he has not received the legal demand notice from the complainant, perusal of the tracking report Ex.CW-1/E reveals that no tracking report showing the delivery of the legal demand notice on the first address is placed on record, however, the same is duly delivered on the second address. Perusal of the cross-examination of the complainant dated 29.07.2022 reveals that specific suggestions have been put to the witness in regard to the addresses of the accused as mentioned in the legal demand notice.
32. In regard to this defence of the accused, reliance is placed by this court on the judgment of Hon'ble Supreme Court of India in C.C. Alavi Haji vs. Palapetty Muhammed, (2007) 6 SCC 555 and on the judgment of Hon'ble High Court of Delhi in RL Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 11 of 16 Varma & Sons (HUF) vs. P. C. Sharma 2019 SCC OnLine Del 8964, wherein it has been held that there is a legal presumption of service of legal demand notice on the accused as per the provisions of section 27 of the General Clauses Act and section 114 of the Indian Evidence Act, if the same is correctly addressed to the accused.
33. It is to be noted that the company master data pertaining to M/s Scienceinsteing Edutech Pvt. Ltd. has not been filed by the complainant so that it could have been identified that the company's registered address was the first address as mentioned in the legal demand notice. It is further to be noted that the complainant has not been filed an affidavit that the same is the last known correct address of the accused and the basis of knowledge of the same. It has been specifically stated by the accused that the said address is his incorrect address.
34. In regard to the second address, it has been admitted by the complainant that the same was lying vacant at the time that he had left the neighbouring flat, i.e., Flat No. 53. It is an admitted position between the parties that the premises at the second address mentioned in the legal demand notice could have been allotted only to a government employee and that the accused was not a government employee. In such circumstances, it is beyond the imagination of this court as to how the accused was served with the legal demand notice at an address which was supposedly lying vacant, which could never have been allotted to the accused and which was never verified by the complainant to be an address belonging to the accused.
35. In view of the above-mentioned judgements, it is an Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 12 of 16 established law that the legal presumption pertaining to the service of the legal demand notice is raised only if the same is sent at the correct address of the accused. If the legal demand notice is sent at the incorrect addresses of the accused then the service of legal demand notice is not deemed to be complete and the ingredients of offence u/s. 138 NI Act are not fulfilled.
36. In view of the above discussion, the accused has successfully been able to raise a probable defence that he had not received the legal demand notice and that the same was sent on his incorrect addresses and has also been able to prove his defence on the basis of preponderance of probabilities.
SECOND DEFENCE
37. The second defence taken by the accused is that he had not taken a loan of Rs.10,00,000/- as stated in the complaint and had only taken a loan in the sum of Rs.9,00,000/- by way of online transfer and the same has already been repaid.
38. Ld. counsel for the accused has submitted that the complainant has not been able to prove the source of funds of the sum of Rs.1,00,000/- allegedly advanced by her to the accused.
39. In this regard, Ld. Counsel for the accused has drawn the attention of this court towards the statements made by the complainant in her cross-examination of the complainant dated 29.07.2022:
"I have given Rs. 1,00,000/- in cash on 05.05.2018 or 06.05.2018 alongwith cheque of Rs. 9,00,000/-. The said amount of Rs. 1,00,000/- was received by me and my husband jointly from agricultural land. Any income from the agricultural land is utilized jointly by me and my Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 13 of 16 husband. The said income has not been shown in the ITR. The agricultural land is in the name of the husband."
40. Ld. Counsel for the accused has further submitted that the complainant is a government official and as such when the complainant had given a sum of Rs.9,00,000/- to the accused through account transfer, then she could also give the remaining sum of Rs.1,00,000/- through account transfer.
41. Ld. counsel for the accused has further submitted that the agricultural income has not been shown by the complainant in her ITR because she has not earned any such income and is lying under oath in respect of the same.
42. Per Contra, Ld. counsel for the complainant has submitted that the accused is merely technical pleas to evade his legal liability. Ld. counsel for the complainant has further relied on the presumption of law as per the provisions of sections 118 and 139 of the NI Act to prove the liability of the accused to the extent of the amount of cheque in question.
43. I have heard the rival submissions of both the parties on this point and perused the relevant record of the case.
44. The advancement of a sum of Rs.9,00,000/- by the complainant to the accused has been admitted by the accused. The only dispute to be decided by this court pertains to the sum of Rs.1,00,000/-. It has been stated by the complainant during her cross-examination that she had given the said sum of Rs.1,00,000/- from the agricultural income received by her husband and as such, admittedly, she was not required to disclose the said amount in her ITR as the same not her income, rather the income of her husband. The financial capacity of the complainant Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 14 of 16 has not been challenged by the accused. Furthermore, when the complainant could give a loan of Rs.9,00,000/-, then there is no reason as to why she could not advance the remaining sum of Rs.1,00,000/- to the accused. Admittedly, the part payment, if any, has been made during the pendency of the present proceedings and the same cannot be considered while deciding the case on merits.
45. In view of the above discussion, the accused has not been able to show on the basis of evidence on record that the accused had not taken a loan of Rs.10,00,000/- as stated in the complaint and had only taken a loan in the sum of Rs.9,00,000/- by way of online transfer.
FINAL ORDER
46. 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.
47. 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 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. Furthermore, the complainant has failed to prove his case beyond Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 15 of 16 reasonable doubt qua the accused in respect of the cheque in question.
48. In view of the aforesaid, accused, namely, Deepak Madan, S/o Sh. Prakash Chander Madan, is hereby acquitted of offence under section 138 Negotiable Instruments Act.
Announced in Open Court (Anshul Singhal) on 08.06.2023 MM(N.I. Act)-03/NDD/RACC/ND
Note: This judgment contains 16 signed pages and each page has been signed by the undersigned.
(Anshul Singhal) MM(N.I. Act)-03/NDD/RACC/ND 08.06.2023 Leela Devi Vs. Deepak Madan CC No.400/2020 Page No. 16 of 16