IN THE COURT OF MS. [ENTITY], METROPOLITAN MAGISTRATE, NORTHWEST, ROHINI: DELHI Unique ID No. 02404R0451152006 CC No. 224/1/06 [ENTITY] Proprietor of M/s Aarti Agro Industries, O/o 99/3, G.T.K. Road, [ENTITY], Alipur, Delhi110036. Through its Authorised Representative [ENTITY] S/o Sh. [ENTITY] Complainant V/s 1. M/s [ENTITY] Village Ram Nagar, Via Pipli Khera More, Sonipat, Haryana 2. [ENTITY] (Partner) R/o F22/57, Sector3, Rohini, Delhi85 3. [ENTITY] R/o 67, ABlock, Puspanjali Enclave, Pitampura, Delhi Accused [ENTITY] M/s [ENTITY] 1/12 JUDGMENT
(1) Name of complainant, [ENTITY] parentage & address Proprietor of M/s Aarti Agro Industries, O/o 99/3, G.T.K. Road, [ENTITY], Alipur, Delhi110036.
(2) Name of accused persons, 1. M/s [ENTITY] Parentage and address Village Ram Nagar, Via Pipli Khera More, Sonipat, Haryana 2. [ENTITY] (Partner) R/o F22/57, Sector3, Rohini, Delhi85. 3. [ENTITY] R/o 67, ABlock, Puspanjali Enclave, Pitampura, Delhi (3) Offence complained of or proved: [SECTION] [ACT] (4)Plea of accused: Pleaded not guilty (5) Date of institution of case: 04.05.2006 (6)Date of reserve of order: 24.07.2014 [ENTITY] M/s [ENTITY] 2/12 (7)Date of Final Order: 08.08.2014 (8) Final Order: Acquitted
1. Vide this judgment I shall dispose of the complaint filed by the complainant under [SECTION] of the [ACT] (hereinafter referred to as the 'Act ').
2. Brief facts relevant for the decision of the case are as under: That the complainant had supplied the Poultry feeds ingredients to the accused. Accused were paying their liabilities/dues time to time to the complainant. Accused no. 2 & 3 issued the following cheques from Oriental Bank of commerce, Prashant Vihar, Delhi, in discharge of the liability on behalf of the accused no. 1, cheque bearing no. 649505 dated 20.02.2006 for sum of Rs. 20,000/, cheque bearing no. 649503 dated 20.02.2006 for sum of Rs. 30,000/, cheque bearing no. 649502 dated 20.02.2006 for sum of Rs. 30,000/, cheque bearing no. 649504 dated 20.02.2006 for sum of Rs. 30,000/, cheque bearing no. 638252 dated 20.02.2006 for sum of Rs. 30,000/ & cheque bearing no. 649511 dated 20.02.2006 for sum of Rs. 20,000/. The complainant presented the above said cheques in his bank as per the direction of accused, but the same were dishonoured with remarks "exceed arrangements" vide bank return memo dated 22.02.2006. The complainant informed the accused regarding the dishonour of the said cheques and demanded the said amount, but the accused did not given any satisfactory explanation regarding the stop payment of the cheques. The complainant was having no option except to serve the legal notice. Legal notice has been served to the accused by the complainant on 23.03.2006 through Registered post and UPC. The legal notice sent to accused no. 1 returned back with the remarks "firm is closed, nothing is on this address". The notice sent to the accused no. 2 was duly served upon the accused and the acknowledgment card was received back by the [ENTITY] M/s [ENTITY] 3/12 Ld. Counsel of the complainant, however the notice sent to accused no. 3 is not received back, hence the same is duly served to the accused but accused persons have failed to make the payment of dishonoured cheques despite service of legal notice. Thereafter complainant finally has filed the present complaint case with the submission that accused persons be summoned, tried and punished according to law.
3. In his presummoning evidence, complainant has examined himself on affidavit. He reiterated the contents of complaint and placed on record the original cheque bearing no. 649505 dated 20.02.2006 for sum of Rs. 20,000/ as Ex. CW1/1, cheque bearing no. 649503 dated 20.02.2006 for sum of Rs. 30,000/ as Ex. CW1/2, cheque bearing no. 649502 dated 20.02.2006 for sum of Rs. 30,000/ as Ex. CW1/3, cheque bearing no. 649504 dated 20.02.2006 for sum of Rs. 30,000/ as Ex. CW1/4, cheque bearing no. 638252 dated 20.02.2006 for sum of Rs. 30,000/ as Ex. CW1/5 & cheque bearing no. 649511 dated 20.02.2006 for sum of Rs. 20,000/ as Ex. CW1/6; original cheque returning memos dated 22.02.2006 as Ex.CW1/7 to Ex. CW1/12; Legal demand notice dated 23.03.2006 as Ex. CW1/13; postal receipt of registry as Ex. CW1/14; receipt of UPC as Ex. CW1/15; legal notice return envelop as Ex. CW1/16; and acknowledgment card as Ex. CW1/17.
4. Accused were summoned for an offence punishable u/[SECTION] of [ACT] and notice u/[SECTION] [ACT] for this offence was framed upon them to which they pleaded not guilty and claimed trial.
5. In his post notice evidence, complainant filed an affidavit Ex. C1 towards his examination in chief and during cross examination he deposed that he and accused persons are in business relations for the last 56 years and he has maintained the business records of the dealings with the accused persons. He further stated that cheques have been issued against part payment of the bills by the accused persons and the cheques mention in the complaint are not towards some particular bills. He also stated that the last material supplied by the [ENTITY] M/s [ENTITY] 4/12 complainant company was on 12.06.2005 vide bill no. 453 and payment has not been received against this bill. He further stated that almost 90% of the payments are received by way of cheque. He also stated that he does not know if the SI. No. of later cheques issued by the accused persons have been encashed in the account of the complainant company or not. He accepted that the total liability against the accused persons as per statement of account is Rs. 29,44,907/ and he had sent a legal notice to accused no. 2, i.e. [ENTITY] with regard to dishonour of a cheque for Rs. 20 Lakhs, however, the complainant company never pursue the same after receiving the reply from accused no. 2 [ENTITY]. He also accepted that the registered cover of legal notice Ex. CW1/16 came back with the report the poultry farm has been closed. He denied that the complainant company was in possession of certain old undated cheques and the same were put into the account on the same day after the complainant company came to know that the accused persons are no more into the business of poultry farm. He also stated that payments in cash have also been received from the accused [ENTITY]. He accepted that the total amount of bills is Rs.23,09,480.04 for the year 200405 and the cheques in question are not mentioned in the bill brought by him and further stated that in his audited balance sheet, Rs.29,44,907/ is due against [ENTITY]. He further stated that he had not filed any civil or criminal case against the [ENTITY] for Rs.29,44,907/ and present three cases are also against Rs.29,44,907/ and accepted that there is a difference between the outstanding amount includes the previous outstanding balance as on 30.03.2002. He also accepted that there are no signatures of the accused on the bills brought by him in the court and voluntarily stated that bills are signed by the carrier/ transporter.
6. Thereafter, statement of accused [ENTITY] under [SECTION] [ACT] was recorded in which all the incriminating evidence were put to the accused to which he has stated that he had issued the cheque in question in favour of the complainant on account of [ENTITY], i.e., accused no. 1 without any date as security and payments of few of the cheques given to the complainant were cleared, and cash and cheques in lieu of these cheques were also given to the [ENTITY] M/s [ENTITY] 5/12 complainant subsequently. He denied for any of his liability towards the cheques in question or towards the complainant.
Statement of accused SC [ENTITY] under [SECTION] [ACT] was also recorded in which all the incriminating evidence were put to the accused to which he has stated that the cheques were given in February, 2005 and the farm was closed in March, 2005. He further stated that the complainant said that the cheques given earlier have been misplaced by him and they should issue new cheques in lieu of them and accordingly three cheques were issued to the complainant in May, 2005 in lieu of these cheques and certain cash were also given in May, 2005 and all the cheques were cleared. He denied for any liability and said that the complainant assured that he would cross all these cheques as and when found so that the same are not use in future, but the same have been misused in this complaint by him.
7. Accused has examined three witnesses in his defence. DW1 [ENTITY] deposed that the said cheques were given in SeptemberOctober 2004 and cash amount towards two cheques was paid to the complainant. He further stated that they issued fresh cheques from the principle account of the firm to the complainant and demanded the old cheques from the complainant which he avoided on one pretext or other saying that the same are not traceable. He also stated that the said cheques were undated and on one cheque there was alteration with date as the same has been changed from 2004 to 2005.
During his crossexamination, he deposed that against cheques bearing no. 647857 & 647860 cash amount of Rs. 70000/ were paid to the complainant, however he said that he does not have any cash receipt of the same.
Second witness Sh. [ENTITY], bank witness who deposed that all the cheques in question are invalid cheques because all the cheques have been crossed with red and black pen as per the guidelines of RBI.
Another witness [ENTITY] deposed that he regularly used to purchase poultry feed from the complainant and used to make payments regularly. He further stated that on 20.03.2005, he issued a cheque no. 649501 in favour of third party and cheque no. 649502 to 649505 were handed over to the [ENTITY] M/s [ENTITY] 6/12 complainant in the month of March, 2005. He also stated that cheque no. 649511 was also issued to the complainant whereas cheque no. 649512 was issued to a third party on 25.03.2005. He further stated that the cheques which were issued to the complainant were without date and in the month of April, 2005, he was told by the complainant that the above mentioned cheques which were issued to him had been misplaced by him and he asked him to issue fresh cheques in lieu of the misplaced cheques and the complainant assured him that whenever the misplaced cheques would be traced out by him, he would put a cross mark on the said cheques so that they could not be misused by any staff member of the firm. He further stated that in lieu of misplaced cheques, he had issued cheque no. 649542, 649543 & 649544 on 14.05.2005 and cheque no. 649546 on 25.05.2005 to the complainant and all these cheque were duly honoured on presentation, counter foil of the cheque book is Ex. DW2/1(OSR) and balance payment was maid in cash.
In his cross examination, he accepted that at the back of the cheques, he had not mentioned that the said cheques were being issued in lieu of the missing cheques and that he does not have any receipt of the cash amount that was paid in lieu of cheque no. 441562, 441564 and 441566 and for the payment of Rs. 70000/ as it was not a regular practice to issue a receipt against cash on their counter. He also stated that he had shown in his Income Tax Returns that he does not have any liability towards the complainant.
9. Following submissions were made on behalf of complainant: That the complainant had supplied the poultry feeds ingredients to the accused and in discharge of their liability accused had issued the cheques in question to the complainant which were dishonoured.
That the main defence of the accused [ENTITY] was that the cheques were issued in 2004 and the cheques were given as a security and payment of few cheques given to the complainant were cleared and cash and cheques in lieu of the cheques were also given to the complainant subsequently. That as per the accused [ENTITY] earlier the cheques were given to the [ENTITY] M/s [ENTITY] 7/12 complainant in February,2005 and in March,2005 they closed their poultry farm and the complainant asked him to issue fresh cheques as cheques given earlier were misplaced by the complainant and after issuing the fresh cheques now the accused persons have no liability.
That in cross examination of the complainant the accused persons failed to brought any relevant fact on record in regard to this matter or in their defence. That the accused [ENTITY] also failed to prove that he had issued the fresh cheques against the said account and further admitted that on the counter foil of his cheque book and also at the back of the cheques it is not mentioned that the said cheques have been issued in lieu of the cheques which were issued from his personal account.
That in these facts and circumstances the accused persons have admitted their liability against the cheques in question and onus is upon the accused to prove that amount of the cheque in question was either paid or their there is no such liability to pay such amount.
That the accused persons have failed to prove that the fresh cheques were issued in lieu of the cheques in question.
That receipt regarding then cash payment by the accused persons has not been proved.
That it comes in evidence of the complainant that the bills brought in the court and income tax return/ balance sheet of the complainant shows that there are due of Rs.29,44,907/ against the [ENTITY] that is the accused firm.
10. Per contra, following submissions were made on behalf of accused: That all the cheques were materially altered.
That all the cheques were blank dated and were deposited without knowledge of the accused persons after approximately one year of closing the firm. That the accused demanded all the cheques returned after issuing of the fresh cheques bearing number 649542, 649543,649544 and 649546 for total sum of Rs. 70,000/, but the complainant did not returned the cheques saying that same have been misplaced and said that he would put cross marks on the cheques [ENTITY] M/s [ENTITY] 8/12 whenever he will find them for avoiding their misuse.
That the cheque bearing number 649544 has still not been presented by the complainant and payment for sum of Rs.60,000/ was made in cash to the complainant and now there is no liability towards the complainant. That one another notice for unknown cheques of Rs.20 lacs was served to the accused which he later admitted in his cross examination that the said cheque was lying with him since year 2000 which was issued by [ENTITY] and was not in the knowledge of [ENTITY].
That the ink and writing on the dates of all the cheques is different. That all the cheques were deposited without any information to accused. That all the cheques were cancelled marked with red and black ink. That no confirmation from the accused qua the amount of Rs.29 lacs claimed by the complainant in his balance sheet although the complainant has not mentioned this fact in any of his notices, complaints or statements, so this is a totally a false and fabricated story.
That the alterations on the dates of the cheques, can be verified by the expert opinion.
11. Before appreciating the facts of the case in detail for the purpose of decision let relevant position of law be discussed first: As present complaint is under [SECTION] of [ACT], there are three ingredients as follows held by the Hon'ble Supreme Court of India in [PRECEDENT].
[SECTION] of the Act three ingredients, viz.:
(i) that there is a legally enforceable debt;
(ii) that the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes a legally enforceable debt; and [ENTITY] M/s [ENTITY] 9/12
(iii) that the cheque so issued had been returned due to insufficiency of funds.
The proviso appended to the said section provides for compliance of legal requirements before a complaint petition can be acted upon by a court of law.
12. The Act raises two presumptions in favour of the holder of the cheque i.e. Complainant in the present case; firstly, in regard to the passing of consideration as contained in [SECTION] therein and, secondly, a presumption that the holder of cheque receiving the same of the nature referred to in [SECTION] discharged in whole or in part any debt or other liability.
[SECTION] and [SECTION] of the said act are read as under:
[SECTION] Presumption as to Negotiable Instruments : Until the contrary is proved, the following presumptions shall be made:
(a) of consideration that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transfered, was accepted, endorsed, negotiated or transferred for consideration;
[SECTION]. presumption in favour of holder: It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in [SECTION], for the discharge in whole or in part, of any debt or other liability.
13. For the offence under [SECTION] [ACT], the presumptions under [SECTION] and [SECTION] have to be compulsory raised as soon as execution of cheque by accused is admitted or proved by the complainant and thereafter burden is shifted to accused to prove otherwise. These presumptions shall end only when the contrary is proved by the accused, that is, the cheque was not issued for [ENTITY] M/s [ENTITY] 10/12 consideration and in discharge of any debt or liability etc. A presumption is not in itself evidence but only makes a prima facie case for a party for whose benefit it exists. Presumptions both under [SECTION] and [SECTION] are rebuttable in nature. Same was held by the Hon'ble Supreme Court of India in [PRECEDENT].
14. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary.
15. I have perused the entire record and have given due considerations to the submissions made on behalf of the parties. In the present case the signatures on the cheques in question are not disputed. The dispute is over the liability towards the cheques in question. The defence given in the present case is that seven cheques were issued by accused number 3 on behalf of accused number 1 and four cheques out of seven cheques were honoured and towards the remaining three cheques the cash payment was made, however the cheques including the cheques in question were not returned by the complainant on the pretext of their misplacement. As per the defence the assurance was given by the complainant for not misusing the cheques by putting cross mark over the cheques. The cheques in question bears the cross mark with red and black pen and as per the bank witness the cheques are invalid because of cross marks with red and black pen. Although the reason for dishonour of cheques is "exceeds arrangement". Counter foil of the cheque book is placed on record by the accused number 3 as Ex. DW2/1 also shows regarding issuance of the four cheques to the complainant in May 2005. Ex.DW2/1 has not been disputed by the complainant. The dates mentioned in the cheques in question is 20.02.2006, however the fresh cheques which are shown to be issued in May,2005 are of later series. The difference of dates in the cheques in question and in the counter foil of cheque book, the cross marks with red and black pen on the cheques in question, non filing of any case by the complainant [ENTITY] M/s [ENTITY] 11/12 against the accused persons regarding the liability of Rs.20 lacs for which he earlier issued the notice and the difference in the amount regarding the liability of accused persons in bills and audited balance sheet raises doubt over the version of the complainant.
16. Hence in the light of above discussion it comes out that the complainant has failed to prove his case beyond all the reasonable doubts and accused has successfully rebut the presumption in favour of the complainant as the standard of proof so as to prove a defence on the part of accused is only 'preponderance of probabilities' and 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 he relies as the same was held by Hon'ble Supreme Court in [ENTITY]). Accordingly accused persons are acquitted for the offence under [SECTION] of [ACT]. Bail bond and Surety bond stands discharged. Original documents of surety if any be released as per rules. File be consigned to record room after necessary compliance.
ANNOUNCED IN THE OPEN COURT ([ENTITY]) TODAY i.e, 8th day of August, 2014 [PRECEDENT] [ENTITY] M/s [ENTITY] 12/12