IN THE COURT OF MS [ENTITY] MM NI ACT (WEST), DELHI [CASE NUMBER] [ENTITY], S/o Sh. Manik Rao Jadhav, R/o H.No. 173-B, BG-6, Paschim Vihar New Delhi-63. Complainant Versus [ENTITY], S/o Late Sh. Jai Karan, R/o 14-B/3, DDA Staff Quater, Dev Nagar, Karol Bagh New Delhi. Accused Date of Institution : 31.01.2012 Offence complained of : U/[SECTION] [ACT]. Date on which the order was reserved : 15.10.2015 Date of Decision : 21.11.2015 Final Order : Acquitted / Held not guilty. [CASE NUMBER] [ENTITY] vs [ENTITY] 1/ 13 Judgment 1.
This judgment shall dispose off the complaint preferred by the complainant against the accused under [SECTION] of the [ACT] (hereinafter referred to as the [ACT]) for dishonor of cheque bearing no. 693743 dated 24.11.2011 drawn in the sum of 5,00,000/- (hereinafter referred to as the impugned cheque).
2. As per the averments in the complaint, the complainant has had friendly relations with the accused since 1995 and on various occasions, the accused took friendly loan amounts from him which had been repaid. It is alleged that in January 2010, the accused obtained a loan in the sum of 5,00,000/- from him for the purpose of marriage of his son and the construction and sale of a DDA plot allotted in the name of his wife in Narela. It is further alleged that the accused promised to repay the said loan amount in October 2011. In September 2011, when the complainant demanded the repayment of his loan amount, the accused assured him that his plot will be sold in one month after which he shall repay the loan amount taken from the complainant and issued the impugned cheque. The complainant thereafter sent a letter dated 19.10.2011 informing the accused that he would present the impugned cheque on or after 27.11.11. Nevertheless upon presentation, the impugned cheque was dishonored for the reason "insufficient funds". Consequently the complainant took recourse to the procedure outlined under [SECTION] of the [ACT] and sent demand notice dated 19.12.2011 to which the accused sent a reply dated 24.12.2011. It appears that as the demand notice [CASE NUMBER] [ENTITY] vs [ENTITY] 2/ 13 mentioned the date of the cheque incorrectly, a rectification notice dated 25.1.2012 was also sent to the accused by the complainant.
3. In support of his case, the complainant exhibited the following documents- cheque in question Ex. CW1/1, returning memo Ex. CW1/2, letter dated 19.10.2011 Ex. CW1/3, demand notice and postal receipts thereof Ex. CW1/6 and Ex. CW1/7 and reply to the demand notice Ex. CW1/10.
4. Per contra the accused pleaded that he did not know the complainant, had not taken the alleged loan amount from him nor issued the impugned cheque to him.
5. Culpability for the offence of dishonor of cheque under [SECTION] of the [ACT] requires that the accused should have drawn the cheque on a bank account maintained by him and issued the same to the complainant in discharge of a debt or other legal liability. It further enjoins the payee to send a notice to the drawer demanding payment of the cheque amount within 30 days of the information of the dishonor of the cheque. It is only upon non payment of the cheque amount within 15 days of the receipt of demand notice that the complainant is at liberty to file a criminal complaint against the drawer for dishonor of the cheque. To bring home the offence of [SECTION] to the drawer of a dishonored cheque, all the aforestated ingredients of [SECTION] must be cumulatively existent.
6. In the present case, all the statutory time limits stand complied with. The accused has also admitted the receipt of the legal demand notice sent by the complainant. Therefore the adjudication of the [CASE NUMBER] [ENTITY] vs [ENTITY] 3/ 13 present complaint is hinged upon the determination of whether at all the cheque in question had been issued to the complainant in discharge of legally enforceable debt or other liability.
7. Like any other offence, fastening of criminal liability upon the drawer of a dishonored cheque demands a strict adherence to the ingredients of [SECTION]. However in so far as the burden of proof in regard to the existence of legal liability is concerned, there is a significant deviation as [SECTION] and [SECTION] of the [ACT] create a presumption in favour of the complainant. This burden can be however discharged by the accused by creating a reasonable doubt in the case of the complainant. Various judicial pronouncements on this aspect have thrown light on how the same can be accomplished by the accused. In one of the more recent judgments namely [PRECEDENT], dated 16 December, 2008], the court has articulated the position thus:
"The accused in a trial under [SECTION] 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 non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed 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. 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 [CASE NUMBER] [ENTITY] vs [ENTITY] 4/ 13 compelling, the burden may likewise shift again on to the complainant The accused has also an option to prove the non- existence of consideration and debt or liability either by letting in evidence or in some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evidence adduced by the complainant during the trial."
It was also held in this case that it is not necessary for the accused to step into the witness box in every case.
8. The evidence led has to be assessed in the light of legal yardstick as enunciated above.
9. During his examination under [SECTION] [ACT] as well as his examination in chief recorded pursuant to his application under [SECTION] [ACT], the accused stated that he had issued the impugned cheque as security to one Sh. [ENTITY], his office supervisor, from whom he used to take petty loans and the impugned cheque had been passed on by Sh. [ENTITY] to the complainant and misused. In the context of the specific defence taken by the accused that he issued the impugned cheques not to the complainant but to one Sh. [ENTITY], it is also pertinent to take note of [SECTION] which lays down another legal presumption operating in favour of the complainant which is to the effect that a 'holder' of a negotiable instrument is a 'holder in due course'.
10. In order to substantiate his defence, the accused examined himself as DW1 and DW2 Sh. [ENTITY] in defence evidence. I shall [CASE NUMBER] [ENTITY] vs [ENTITY] 5/ 13 first deal with the deposition of DW2 Sh. [ENTITY]. DW2 supported the version of the accused in as much as he deposed that the accused used to take petty loans from Sh. [ENTITY] who used to take cheques from him as well as the accused at the time of giving loans. DW2 also placed on record Ex. DW2/X and DW2/Y i.e. copy of the demand notice sent by the complainant to him and the reply sent by DW2 thereto. These documents were not objected to by the complainant and therefore stand proved. As per the contents of Ex. DW2/X, the complainant herein advanced a loan in the sum of 2 lacs to DW2 also in lieu of which DW2 issued a cheque bearing no. 379541. As upon presentation the abovementioned cheque was dishonored, demand notice Ex. DW2/X was sent by the complainant to DW2. During his cross examination dated 10.7.2014 also, the complainant deposed that he had advanced loan amount in the sum of 2 lacs to DW2 in January 2010. The Ld. counsel therefore argued that the complainant is a professional moneylender not possessing any money lending licence and therefore the loan amount advanced by him cannot constitute valid consideration. The Ld. counsel presumably relied upon the [SECTION] of the [ACT] which is also applicable to Delhi.
11. However, a closer scrutiny of the deposition of DW2 reveals that his deposition is not of much consequence. The cheque in question was not given to Sh. [ENTITY] in the presence of DW2. DW2 actually states that he does not know if there was any transaction between the complainant and the accused though he does state that the accused used to take loan from Sh. [ENTITY] and Sh. [ENTITY] used to take cheque from the accused. The mere fact that the [CASE NUMBER] [ENTITY] vs [ENTITY] 6/ 13 complainant has also initiated litigation against DW2 for recovery of a loan does not vouchsafe that the complainant is a professional moneylender. In any event, even if for the sake of argument, the submission of the Ld. counsel is accepted at face value, the same does not come to the aid of the counsel in view of the pronouncement of the Delhi High Court in [PRECEDENT] dated 27.3.014 wherein in the context of [SECTION] of the said Act, it was held that, "The aforesaid provision does not debar a money lender from instituting a complaint under [SECTION] of the [ACT], which is a remedy enforceable before a criminal court, and totally independent of a civil suit. The criminal liability is incurred only in case a cheque is issued in discharge of a debt or other liability, the said cheque is dishonoured for want of funds and the borrower fails to make payment of the amount of the cheque even after receipt of a notice from the lender."
12. Therefore, the contention of the ld. Counsel for the accused to the effect that the loan amount in question is not legally recoverable on account of the fact that the complainant is an unlicensed moneylender cannot be accepted.
13. The accused filed an application seeking cross examination of the complainant under [SECTION] of the [ACT] which was allowed and the complainant was cross examined. The deposition of the complainant during cross examination is of utmost significance and the relevant portion of the same is being reproduced below:
[CASE NUMBER] [ENTITY] vs [ENTITY] 7/ 13 "The cheque Ex.CW1/1 was given to me in January 2010 but I can not give the date. It was given to me at the time of second installment It is wrong to suggest that I do not have dealing with the accused nor I have ever paid a loan of Rs. 5 lacs to the accused. The loan was given for a period of 3 months without interest. When the accused did not return the loan within 3 months I had sent a notice to the accused calling upon to repay the amount The accused has taken the loan and undertook to repay the loan within one year without any interest "
14. The perusal of this testimony brings to fore various contradictions. To begin with, the complainant has made inconsistent statements regarding the period for which the loan was advanced and the date on which the impugned cheque was given. As per his affidavit, the loan in question was advanced in January 2010 with the accused promising to repay the same in October 2011 while the cheque in question was issued by the accused in September 2011. On the other hand, during cross examination, the complainant deposed that the cheque in question was given to him in January 2010 itself at the time of payment of the second installment of the loan amount. Again, the complainant deposed during cross examination that the loan amount in question was given for a period of three months whereas in another place, he deposes that the loan in question was given for a period of one year. It is thus clear that the complainant is unable to tell the period for which the loan amount in question was advanced to the accused or when the cheque in question was issued by the accused. This fact becomes specially relevant in light of the specific plea taken by the accused that he had never issued the cheque in question to the [CASE NUMBER] [ENTITY] vs [ENTITY] 8/ 13 complainant but had instead issued the same to another person namely Sh. [ENTITY].
15. Further, the complainant was cross examined upon whether he had reflected the loan amount in question in his ITR as well as the mode in which the loan amount was advanced. The relevant portion of his testimony is reproduced below:
"Q. Can you show the bank statement to show that you had Rs. 5 lacs for paying the loan to the accused in the month of January 2010?
Ans. In January 2010 sum amount I have withdrawn from the bank and the sum of the money was from sale proceed of the shop.
Q. How much money you have withdrawn from the bank and on what date?
Ans. I will produce my statement of account pertaining to January 2010 to show as to how much money I have withdrawn from the bank and on which date. It may be 1,50,000/- or 2,50,000/- but I can not tell the exact amount withdrawn in January 2010 as on today.
It is wrong to suggest that I did not have Rs. 5 lacs with me to pay as a loan to the accused in the month of January 2010. The loan was paid in cash twice to the accused, but I do not know the exact date. I did not obtain any receipt from the accused at the time of paying him loan in cash. There was no other witness at the time of paying the loan. No agreement regarding payment of loan setting the terms and conditions as executed between me and the accused "
[CASE NUMBER] [ENTITY] vs [ENTITY] 9/ 13
16. The fact that the complainant advanced the loan amount in installments comes to light for the first time during the cross examination of the complainant as the same is neither mentioned in his complaint nor affidavit in evidence. But thereafter, the complainant is unable to tell the amount of the installments in which the loan amount was paid to the accused and when these installments were paid. The fact that the loan amount itself was given in two installments was introduced for the first time during cross examination and judging from the vagueness of the testimony of the complainant on this aspect, it appears as an afterthought.
17. Furthermore, according to the testimony of the complainant, while part of the loan amount was withdrawn from the bank, part of the loan amount was advanced from the sale proceeds of a shop. During further cross examination, the complainant produced a statement Ex. CW1/15 as per which there is no withdrawal of the amount of 5 lacs i.e. the loan amount in question during January 2010. Further according to the testimony of the complainant, while part of the loan amount was withdrawn from the bank, the remaining amount was obtained from the sale proceeds of a shop. Now, it is not in the ordinary course of nature for a person to keep huge amounts of cash at his home instead of keeping it in the bank or investing it elsewhere. Therefore, the deposition of the complainant as to the mode in which the loan amount was advanced and how is also not coherent. Thus the complainant is unable to prove the withdrawal of the loan amount and its advancement to the accused.
[CASE NUMBER] [ENTITY] vs [ENTITY] 10/ 13
18. Furthermore, it is alleged by the complainant that he had advanced the loan amount to the accused for the marriage of his children and for construction and sale of a DDA plot. On the other hand, the accused has vehemently contended that the requirement of the accused for which the loan amount was allegedly advanced by the complainant is utterly false in view of the fact that the son of accused namely [ENTITY] was already married in 2006 and the aforementioned DDA plot had already been sold by the accused in 2007. In support of his plea, the accused placed on record Ex. DW1/A and [ENTITY] Mark A is a copy of the bayana receipt executed between Smt. [ENTITY] w/o the accused and one Sh. [ENTITY] regarding the sale of a plot of land. It was relied upon by the accused to support his contention that as the plot for the construction whereof the complainant allegedly advanced the loan amount had already been sold, the alleged claim of the complainant was false and baseless. Ex.DW1/A is the original wedding card of the son of the accused namely [ENTITY].
19. Let us now also look at the deposition of the complainant on this point:
"I know the elder son named [ENTITY] whose marriage was to be perform in January, 2010 for which the loan was taken. It is wrong to suggest that the son of the accused [ENTITY] for whose the loan was taken for marriage was taken was married on 19.02.2006. i do not know if the plot for which the loan was taken in the year 2010 was already sold by the accused and his wife on 30.09.2007."
20. Mark A cannot be relied upon as the same is a photocopy and has not been proved in accordance with the rules of the Indian [CASE NUMBER] [ENTITY] vs [ENTITY] 11/ 13 [ACT]. In any case, a bayana receipt by itself does not prove the factum of the sale transaction as it is not equivalent to a sale deed. Therefore Mark A by itself does not lend credence to the contention of the accused and for the abovestated reasons cannot be relied upon. However, Ex. DW1/A is the original wedding card of the son of the accused [ENTITY] which clearly affirms the statement of the accused that his son was already married in 2006 and therefore there would be no need for him to obtain loan on this account in 2010. It was contended by the Ld. Counsel for the complainant, that the accused misguided the complainant by falsely portraying to him that his son was to get married and the complainant cannot be faulted with for believing the story of the accused and actually did not know that the son of the accused was already married. However, the complainant has himself stated during cross examination as reproduced above that he knows [ENTITY] the elder son of the accused whose marriage was to be performed in January, 2010. Further, in his complaint and affidavit in evidence, the complainant has averred that he and the accused were known to each other since 1995. Therefore, in these circumstances, the complainant cannot now say that the accused falsely told him that his son was to get married and obtained loan on that pretext.
21. It was also contended by the Ld. Counsel for the accused that the complainant has not reflected the loan amount in his ITR which suggests that no such loan amount as alleged was actually advanced to the accused. The Ld. Counsel also contended that the income tax return of the complainant suggests that he did not have the financial means to advance such a huge amount. The counsel invited the attention of the court to the following deposition of the complainant:
[CASE NUMBER] [ENTITY] vs [ENTITY] 12/ 13 "I am income tax assesse, I had not shown in my income tax return regarding the loan of Rs. 5 lacs paid to the accused in the month of January 2010. It is wrong to suggest that I had Rs. 5 lacs with me which was not shown in my income tax return and in my bank statements. The shared amount of Rs. 5 lacs was unaccounted money from my savings".
22. I have perused the income tax return filed by the complainant as [ENTITY] Though no specific opinion can be given as to the financial means of the complainant on the basis of the ITR, it is not disputed that the loan amount in question is not reflected therein. The counsel for the accused has rightly placed reliance upon the judgment of Bombay High Court in [PRECEDENT] and judgment of the Delhi High Court in [ENTITY] Aggarwal vs State and Anr., 2015 IX AD (Delhi) 377.
Conclusion:
23. Therefore, upon scrutiny of the evidence that has come on record and upon appreciation of the same, I am of the considered opinion that the accused has been able to create a reasonable doubt in the case of the complainant. Accused is accordingly acquitted for the commission of the offence under [SECTION] of the [ACT].
Announced today in the ([ENTITY]) open court on 21.11.2015 MM NI ACT (WEST)/DELHI/21.11.2015 [CASE NUMBER] [ENTITY] vs [ENTITY] 13/ 13