IN THE COURT OF METROPOLITAN MAGISTRATE04, PATIALA HOUSE COURTS, NEW DELHI. Presided by: Ms. Vijeta Singh Rawat Shiv Karan Vs. [ENTITY] C C No. 714/1/13 U/[SECTION] [ACT]. JUDGMENT
[ENTITY] R/o 1591, Krishi Kunj New Delhi110012 Complainant Versus [ENTITY] S/o Sh. [ENTITY], R/o 173, TypeI, Chiriya Colony, Janak Vihar, Pusa Campus, New Delhi110012 Accused
a) Case ID No. of the case. :02403R0045632013
b) [CASE NUMBER]
c) Date of institution. :15.05.2008
d) Offence :U/[SECTION] [ACT].
e) plea of accused :Not guilty. f) Final Order :Acquitted. g) Date of Judgment :30.10.2013
BRIEF FACTS/ STATEMENTS OF THE REASONS FOR THE DECISION.
1. The present complaint has been filed by [ENTITY], R/o 1591, Krishi Kunj, New Delhi110012, (hereinafter, referred to as the [CASE NUMBER] complainant) against the accused [ENTITY], S/o Sh. [ENTITY], R/o 173, TypeI, Chiriya Colony, Janak Vihar, Pusa Campus, New Delhi110012 u/[SECTION] of the [ACT] (hereinafter, referred to as "the Act").
2. It has been averred in the complaint that the complainant had friendly relations with the accused; that the accused approached the complainant for a friendly loan of Rs. 1.5 lacs on 25.01.2005 and Rs. 1 lac on 23.03.2005 and agreed to pay interest of 10% p.a. (as per GPF interest); that as token, the accused issued a receipt and promissory note on stamp paper whereby he undertook to repay the loan on demand; that the accused returned Rs. 10,000/ on 11.11.2007 and Rs. 20,000/ on 25.12.2007 by way of cash and for the remaining amount of Rs. 2.20 lacs, he issued the following cheque drawn on Syndicate Bank, Pusa Campus, IARI,New Delhi in discharge of his legally enforceable liability:
I. Cheque bearing no. 806273 dated 20.04.2008 for Rs. ,2,20,000/.
It has also been stated that on presentation, the above said cheque was returned dishonored with reason " funds insufficient" vide return memo dated 22.04.2008; that the complainant therefore, sent a legal notice dated 23.04.2008 through Counsel vide post which was not received back and hence was deemed to have been served upon accused. Further that despite issuance of notice, payment within [CASE NUMBER] stipulated period has not been made. It has been averred that the accused has committed offence u/[SECTION] of the Act and the present complaint has been filed within stipulated period and is therefore, within limitation. It has also been pleaded that this Court has jurisdiction to entertain the complaint as the drawer and drawee bank are within the jurisdiction of this Court.
3. Ld. Predecessor of this Court, took cognizance of the offence on the aforesaid facts and vide order dated 15.5.2008 issued summons to the accused for offence u/[SECTION] of the Act. The accused entered appearance before the Court on being served with the summons and was admitted to bail on 30.07.2008. Notice u/[SECTION] [ACT] was framed against the accused on 25.04.2009 to which the accused pleaded not guilty and claimed trial.
4. Post summoning evidence by way of affidavit CW1/1 was tendered on 24.02.2010 alongwith following documents:
1. Ex. CW1/A promissory note.
2. Ex. CW1/B original cheque.
3. Ex. CW1/C return memo
4. Ex. CW1/D1 and Ex. CW1/D2 office copy of legal notice.
5. Ex. CW1/E1 and Ex. CW1/E2 postal and UPC receipt.
5. CW1 was duly cross examined.
[CASE NUMBER]
6. The complainant further examined the following witnesses in support of his case.
A. Sh. [ENTITY] as CW2 who stated that complainant was his maternal uncle and to him Rs. 1.5 lacs had been given for giving loan to his colleague whose particulars had not been disclosed by the complainant. He was duly cross examined. B. Sh. [ENTITY] as CW3 who tendered his affidavit Ex. CW3/1 in evidence and as per the same, he claimed that in March, 2005, the complainant asked for Rs. 50,000/ as loan for his colleague [ENTITY]; that same was given to him; that in January, 2008, the aforesaid money was returned by complainant. He was duly cross examined.
C. Sh. [ENTITY] as CW4 who tendered his affidavit Ex. CW4/1 in evidence and testified that both complainant and accused were known to him being his colleagues; that on 13.06.2007 both parties had a heated argument and it was then that the witness learned about the dealings between the parties; that accused had taken Rs. 2.5 lacs as loan and complainant was demanding the same; that accused sought time of 45 months to clear the loan amount and that accused also assured to make the payment The witness was duly cross examined.
7. Thereafter, statement of accused u/[SECTION] [ACT] was recorded on 04.09.2012 by the Ld. Predecessor of this Court. The [CASE NUMBER] accused denied the incriminating circumstances appearing against him and stated that he is illiterate and had given the cheque in dispute to the complainant for taking out the salary which has been misused; that 1213 cheques had been given for the aforesaid purpose and the last cheque was misused though, the complainant had informed that it was lost.
8. Thereafter, defence evidence was led. The accused examined himself as DW1. He stated that he is working as a beldaar with Agriculture Department since last 15 years. The complainant was also working in the same manner as beldaar; that Rs. 3000/ was taken as loan from complainant in lieu of which the cheque in dispute was given as security in blank which has been misused. He denied that he received any legal notice. He was duly cross examined.
File received by way of transfer on dated 30.03.2013 vide order no. 06/DHC/Gaz./G3/VI.E.2(a)2013 dated 19.02.2013.
9. Defence evidence was closed vide order dated 04.10.2013.
10. Final arguments on behalf of both the parties have been heard.
[CASE NUMBER]
11. This Court has considered the written submissions filed and the material on record.
12. It has been held in [PRECEDENT] as under:
On a reading of provisions of [SECTION] of the [ACT] it is clear that the ingredients which are to be satisfied for making out a case under the provision are:
"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 for the discharge of any debt or other liability; ii. 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, which ever is earlier. Iii. That cheque is returned by the bank unpaid, either because the amount of money standing to the credit of the account is insufficient to honour the cheque for that it exceeds the amount arranged to be paid from that account by an agreement made with the Bank; iv. 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 is unpaid.
v. 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."
[CASE NUMBER]
13. Further, [SECTION] of the Act stipulates as under:
"Until the contrary is proved, the following presumptions shall be made:
(a) of consideration. that every negotiable instruments was made or drawn for consideration, and that every such instrument, when it has been accepted, inndorsed, negotiated or transfer was accepted, indorsed, negotiated or transfered for consideration; "
[SECTION] of the Act provides as under: "Presumption in favour of holder. It shall be presumed, until 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."
In this regard, this Court also seeks to reproduce the observations of the Hon'ble Apex Court that " it is obligatory on the Court to raise this presumption in every case where the factual basis for raising presumption has been established " Reliance is placed upon Hiten P. Dalal Vs. Bratindra Nath Banerjee (2001) 6 SCC
14. As soon as the complainant discharges the burden to prove that the cheque was executed by the accused, the rules of presumption u/[SECTION] and [SECTION] of the Act help him shift the burden on the accused. Reliance is placed upon [PRECEDENT].
15. Further, it has been held in Bharat Barrel and Drum [CASE NUMBER] and referred to [PRECEDENT]. [PRECEDENT] as under:
"Upon consideration of various judgment as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under [SECTION] would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the nonexistence of a 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 nonexistence of the consideration can be either direct or by brining on record the preponderance of probabilities by reference to the circumstances upon which he relies
25. Furthermore, whereas prosecution must prove the guilt of an accused beyond all reasonable doubt, the standard of proof so as to prove a defence on the part of an accused is "preponderance of probabilities".
Inference of preponderance of probabilities can be drawn not only from the materials brought on records by the parties but also by reference to the circumstances upon which he [CASE NUMBER] relies
26.A statutory presumption has an evidentiary value,. The question as to whether the presumption whether stood rebutted or not, must, therefore, be determined keeping in view the other evidences on record "
However, [SECTION] does not raise a presumption that debt was legally recoverable.
16. In the considered view of this Court essential ingredients of offence punishable u/[SECTION] of the Act have been established by the complainant beyond reasonable doubts as the issuance of cheque by the accused, its dishonour on presentation for reasons "insufficient funds", issuance of legal notice, its service and failure to make payment within stipulated period have not been controverted by the accused. As such, grounds exists to raise a presumption provided for in [SECTION] of the Act.
17. To rebut the presumption that complainant did not have a legally enforceable debt qua which cheque in dispute was issued, the accused questioned the capacity of the complainant to pay Rs. 2.5 lacs as loan. Suggestions have been put to CW1 during his cross examination. The witness has stated that the loan was arranged from his family members namely, Sh.[ENTITY] and from [CASE NUMBER] the joint funds maintained by him and his brother Sh. [ENTITY]. The complainant denied that he was an income tax payee. Sh. [ENTITY] who examined as CW2 also during cross examination claimed to have the capacity to pay Rs. 1.5 lacs to the complainant by way of loan out of the money he had kept for sale and purchase of land. He also stated that he was doing the work of property in partnership through an unregistered partnership firm. CW3 during cross examination also admitted that he was not filing ITR and also that he did not keep any proof of transactions. It is pertinent to mention here that a contradiction has occurred in the testimony of CW1 and CW2 as unlike the claim of CW1 that Rs. 1,00,000/ was arranged out of joint funds, CW2 has talked about advancing Rs. 50,000/ as loan to complainant. Further, in the complaint and legal notice relied upon by the complainant, there is an averment that loan had been given out of his "hard earned money". This has been contradicted by the testimony of CW1 on oath before the Court as before the Court other sources of money was sought to be given.
18. The question therefore, arises is whether or not, the accused has been successful in raising doubts on the case of prosecution by rebutting the presumption in favour of complainant. The answer, has to be in affirmative as not only has the accused being successful in raising doubts upon the capacity of a complainant to pay the loan amount but has shown that the complainant has tried to prosecute [CASE NUMBER] for a debt which cannot be legally enforceable as the same has not been shown by the complainant or by the persons who advanced that loan by way of reflecting the same in the Income Tax Return.
19. The onus had shifted upon the complainant and he was required to lead credible evidence to prove that he had the capacity to pay loan of Rs. 2.5 lacs as averred and that it was reflected in the Income Tax Return of CW1 to CW3. Assistance of the Court cannot be sought to legalize recovery of loan which was not otherwise legally enforceable. Thus, this Court is constrained to hold that the accused has been successful in rebutting presumptions raised in favour of the complainant that loan of Rs. 2.5 lacs as claimed was advanced. Reliance is placed upon [ENTITY] (Supra).
20. The veracity and consistency of defence evidence is not being delved upon as the complainant has to stand on his own feet and cannot take benefit of loopholes in the defence.
21. Thus, in the light of the above discussion, this Court is of the view that the complainant has failed to prove the guilt of the accused beyond reasonable doubt. The accused is therefore, entitled to benefit of doubt. He stands acquitted of offence u/[SECTION] of the Act.
[CASE NUMBER]
22. File be consigned to records after compliance [SECTION] [ACT] on furnishing of bail bond for a sum of Rs.10,000/ alongwith one surety.
Announced in the open Court (Ms. [ENTITY]) on 30.10.2013 MM04/Patiala House Courts New Delhi.
[CASE NUMBER]