IN THE COURT OF MS [ENTITY] MM [ACT] [CASE NUMBER] Sh. [ENTITY], S/o Sh. [ENTITY], R/o Flat no.233, Pocket-I, Sector 5, Dwarka, New Delhi. [ENTITY] Versus Sh. [ENTITY], So Sh. [ENTITY], R/o Near DDA Flats, VPO Bakarwala, Nangloi, Delhi. Accused Date of Institution : 15.11.2010 Offence complained of : U/[SECTION] [ACT]. Date on which the order was reserved : 06.09.2014 Date of Decision : 17.09.2014 Final Order : Convicted / held guilty Judgment: [CASE NUMBER] 1 1.
Vide this judgment, I shall dispose of the present complaint filed u/[SECTION] [ACT] for dishonor of cheque bearing no. 508331 drawn on Bank of Baroda, Najafgarh Branch Delhi (hereinafter referred to as the impugned cheque). Before undertaking a further discussion, a brief outline of the factual matrix is in order.
2. It is the case of the complainant that in February 2010, the accused took a friendly loan in the sum of 3,20,000/- from the complainant promising to return the same within four months and issued a cheque bearing no. 257946 dated 21.06.2010. Same is Ex.CW1/1. After four months, the complainant presented the cheque with his banker on 30.7.2010 and the same was returned unpaid with the remark "insufficient funds" vide returning memo Ex. CW1/2 (colly). It is further submitted that when the complainant approached the accused regarding the fate of the cheque, he was told to present it again after two months. When the complainant again presented the impugned cheque on 3.9.2010, the cheque was again returned with the remark "insufficient funds" vide retunring memo Ex.CW1/2(colly). Thereafter, the complainant sent legal demand notice dated 27.9.2010. The demand notice and postal receipt is Ex.CW1/3 and Ex.CW1/4. However as the accused failed to make the payment within the statutory period after receiving the legal demand notice, the present complaint was filed.
3. [ENTITY] filed his pre-summoning evidence by way of affidavit Ex. CW1/A. Upon consideration of the same alongwith the accompanying documents, a prima facie offence u/[SECTION] [ACT] was made out. Consequently, the accused was summoned. On his appearance, the accused was granted bail on furnishing bail bonds and thereafter, the notice u/[SECTION] [ACT] stating substance of accusation was served upon the accused on to which he pleaded not guilty and claimed trial.
4. At the time of framing of the notice, plea of defence of the accused was recorded. In his statement, the accused admitted his signatures on the impugned cheque and issuance of the same to the complainant. He also admitted having filled the other particulars in the cheque except the date. His defence was that he entered into a transaction with the complainant for purchase of a car but the car was never delivered to him. Thus the accused denied any liability towards the complainant and also denied the receipt of legal demand notice.
5. After the notice was served upon the accused, subsequently, an application was moved by him under [SECTION] of the [ACT] for cross examination of the complainant and the same was allowed.
[ENTITY] Evidence:
6. The complainant adopted his pre summoning evidence post summoning and did not produce any other witness. In his affidavit he has reiterated the complaint. During his cross examination, he stated that he had nothing to prove his business association with the accused and he also did not know the name of the father of the accused. It was further stated by him that he had no documentary proof to show the possession of the loan amount nor had he reflected the same in his ITR or books of account. He also stated that he had not disclosed the source of funds where from he arranged the loan in question. He denied that he was an investment agent in City Limouzines India Pvt. Ltd., City Real Com/City Cooperative Credit society or that he had taken the cheque in question from the accused for investment in the abovestated companies. On the contrary it was stated by the complainant that he had invested in the companies through the accused albeit he also deposed that he did not have any documentary proof in regard thereto. The complainant was confronted with document Mark A (colly) on which he admitted his signatures. Mark A is a stamp paper wherein it is written that the complainant took 2, 52, 854/- in cash and three cheques from the accused for investment in City Limouzine a company which gives a good return on vehicles.
Statement under [SECTION] [ACT]:
7. The accused reiterated the plea taken by him at the time of serving of notice.
Defence Evidence:
8. In his defence, the accused examined himself as DW1. In his examination in chief, the accused stated that he had given the impugned cheque to the complainant for the purpose of investment. He stated that the address on the demand notice was not his correct address. During his cross examination, he exhibited Ex. DW1/X which is the original of Mark A. A specific suggestion was put to him to the effect that the stamp paper was given in blank with the signature and seal at point A, B and C and that this document was a false and fabricated document which was denied by him. He deposed that Mark A bore the seal of City Real Com Ltd. at point B and the signature of the complainant at Point C. He further stated that he could not tell whose signature was present on the document at point A. It was also deposed by him that the document was crossed when it was given to him. It was stated by him that the seal on the backside of Mark A bore the date 15.12.2000. However it was denied by the accused that he was an agent of City Limouzine or City Real Com.
9. During his cross examination dated 4.6.2014, the accused had stated that he could produce the ITR records of himself and his father pertaining to the withdrawal of 2, 52, 841/- mentioned in Mark A. However during his subsequent cross examination, the accused did not produce his ITR records.
10. Lastly, the accused relied upon his bank Statement from the Corporation Bank as Ex. DW1/X1 in his deposition. However as this document has not been placed on record, it is not being read in evidence. But he did not produce the bank statement from Deutsche Bank and Bank of Baroda as it was stated by him that he had closed these accounts since he issued the cheques in question.
11. To prove the commission and successful prosecution of an offence under [SECTION] of the [ACT], the following ingredients are required to be proved:
(i) Cheque was drawn by the accused on a bank account maintained by him.
(ii) Cheque was issued in favour of the complainant in discharge of legal liability.
(iii) Cheque was returned for want of sufficient funds/ arrangement exceeded upon presentation.
(iv) Cheque was presented during the period of its validity.
(v) A demand notice is sent by the complainant to the accused within 30 days of receipt of information from the bank regarding dishonor of the cheque.
(vi) Notwithstanding the receipt of the demand notice, the accused fails to make payment of the cheque amount within 15 days.
[SECTION] of the Act further requires that the complaint should be filed within one month from the date on which the cause of action arises.
Appreciation of evidence:
12. In the present case, all the statutory time limits mandated by law as aforestated stand complied with. In view of the plea of defence taken by the accused in the present case, this court is required to address the presence of two important ingredients of the offence under [SECTION]. The first one pertains to the existence of legally enforceable liability in favour of the complainant and the other pertains to the receipt of legal demand notice by the accused. I shall address the latter issue first.
13. The address on which the legal demand notice was sent by the complainant is Village and Post Office Bakkarwala near DDA Flats, police station Nangloi, Delhi. During his examination in chief also, the address stated by him is 'Near DDA Flats VPO Bakarwala Nangloi Delhi.' However during his cross examination it was stated by the accused that the address stated by him during his examination in chief was correct except that 'near DDA flats' was wrongly mentioned. It was further stated by him that his residence is near R.K. Memorial School and DDA flats are around half a kilometer from his residence. In my opinion, the subsequent statement of the accused regarding his address is of no consequence in light of his deposition on this aspect during the examination in chief. It is merely an afterthought. Even the improvement sought to be made by him in his testimony is insignificant as it hardly indicates any substantial change in the address. It is settled law that if the demand notice is properly and correctly addressed, there is presumption of service thereof. For this proposition, reliance is placed upon the pronouncements of the Supreme Court in [PRECEDENT] and [PRECEDENT]. It is then for the accused to prove that he did not receive the demand notice. As the accused in the present case has not been able to dispel this presumption, service of demand notice stands proved.
14. As the accused admitted his signatures on the impugned cheque and issuance of the same to the complainant, therefore, execution of the cheque also stands duly proved. The only bone of contention that now remains is whether the accused owed any liability to the complainant in the cheque amount. Once, the execution of the cheques is proved, the presumptions of law u/[SECTION] and [SECTION] [ACT] come into play and the initial burden of proof shifts upon the accused. But these presumptions of law are rebuttable.
15. The standard of proof required to be led by the accused to rebut the presumptions of law in favour of the complainant has been enunciated in the pronouncement of the Supreme Court in [PRECEDENT] wherein the apex court held that "it is not necessary for the defendant to disprove the existence of consideration by way of direct evidence. The standard of proof evidently is pre-ponderance of probabilities. Inference of pre-ponderance of probabilities can be drawn not only from the materials on records but also by reference to the circumstances upon which he relies."
Let us see whether the accused has been able to rebut the same by adducing sufficient evidence on record or not.
16. To begin with the accused has taken contradictory pleas. While at the time of framing of notice and in his statement under [SECTION] [ACT], it is stated by the accused that he had given the cheque in question to the complainant for purchase of a car from him, the story put forth by him while cross examining the complainant is that the accused gave the impugned cheque to the complainant for the purpose of investment in City Limousines and City Real Com. In the present case, the accused has brought forth documentary evidence in support of his case. The fulcrum of the version propounded by the accused is Ex. DW1/X (Mark A). The complainant admitted his signatures thereon. However a specific suggestion was put to the accused that the same was given blank to the accused which was denied by him. It is also the case of the complainant that he invested in City Limouzine, City Real Com and City Cooperative Credit Society through the accused. Thus an explanation has been furnished by the complainant as to how a blank document signed by him came into the possession of the accused. Perusal of this document reveals that the same is typed and signatures of the complainant appear right at the bottom and there is a noticeable gap between the signature and the body of the document. This lends credence to the version of the complainant that the document was taken in blank signed form from him. Further, the stamp at the back of the document bears the date 15.12.2000 and the same is also admitted by the accused during his cross examination whereas the document is purportedly in respect of a transaction which has taken place in the year 2009. It therefore gives rise to a very justifiable question as to why a stamp paper bought in 2000 was written in 2009 for which there is no explanation forthcoming. This question in turn gives rise to a serious doubt regarding the credibility of the document itself. Interestingly, this document also bears the signature of a third person but it is stated by the accused that he does not know as to whose signature it is.
17. To buttress his claim that the complainant misrepresented to him that he was an investment agent of the aforesaid companies, the accused has placed on record [ENTITY] and Mark C which stand proved as the complainant has admitted his signatures thereon and not denied their contents. It is therefore important to examine the nature of these documents. [ENTITY] is an agreement between City Real Com and the complainant executed on 5.1.2009 whereby City Real Com, the owner of a particular property has allotted the partial ownership thereof to the complainant to safeguard the interest of the complainant in the redeemable preference shares in the sum of Rs. 1, 07, 000 allotted to him by City Real Com. Mark C is an agreement between City Limouzines (India) Ltd. and the complainant whereby the complainant agrees to take vehicles on lease/hire or margin amounts towards purchase of motor vehicles from City Limouzines. From the contents of these documents it cannot be deduced that the complainant is an investment agent of City Limouzines Ltd. or City Real Com Ltd. On the other hand, it is the case of the accused that the complainant used these documents to misrepresent to him that he was an investment agent of City Limouzines Ltd. and City Real Com Ltd. and thereby induce him to part with the cheques.
18. The document Mark A states that the complainant took 2, 52, 841/- from the accused in cash and three cheques viz. cheque bearing no. 089751 drawn on Corporation bank, cheque bearing no. 257946 drawn on Deutsche Bank and cheque bearing no. 508331 drawn on bank of Baroda. But the accused did not produce ITR records pertaining to withdrawal of 2, 52, 841/- even though it was stated by him that he had reflected this amount in his ITR.
19. The Ld. counsel for the accused has contended that the complainant has not disclosed the source of funds out of which he gave the alleged friendly loans to the accused and therefore this fact by itself dispels the presumption lying in his favour. In support of this proposition, the accused has relied upon three judgments. However, upon perusal of these judgments, I am of the view that they are not applicable to the facts of the present case. In [PRECEDENT], the complainant had specifically mentioned the sources of money out of which the loan amount was given but he had been unable to prove those sources. In [PRECEDENT], the complainant had advanced a loan of 31 lakhs i.e. a huge amount but not specified the date on which the loan was given. Further albeit the complainant had stated that the loan was given on interest, the rate of interest had not been disclosed. In that case, the complainant was a money lender and the loan amount had been advanced without any written agreement which belied the prudence one would associate with a moneylender. In these circumstances, the court came to the conclusion that the conduct of the complainant was unlikely. In [PRECEDENT] again there were various infirmities in the evidence of the complainant. The complainant in that case was not aware as to when and where the loan was given. Further there was a difference in the handwriting in which the particulars had been filled in the impugned cheque. In light of these infirmities, the trial court acquitted the accused which was subsequently upheld by the Supreme Court. In my opinion, it was incumbent upon the accused to impeach the solvency of the complainant. But no suggestions to that effect were put to the complainant. On the other hand, the complainant has stated that he is in the business of real estate and this fact remains uncontroverted by the accused. If that be the case, it would not be implausible for the complainant to advance the loan in question.
20. On an appraisal of the evidence on record, I am of the considered view that the accused has not been able to substantiate his defence. In these circumstances, the case of the complainant stands proved. The accused is found to be guilty and hereby convicted for the offence under [SECTION] [ACT].
Announced today in the ([ENTITY]) open court on 17.09.14 MM [ACT] THE COURT OF MS [ENTITY] MM [ACT] Sh. [ENTITY], S/o Sh. [ENTITY], R/o Flat no.233, Pocket-I, Sector 5, Dwarka, New Delhi-18. [ENTITY] Versus Sh. [ENTITY], S/o Sh. [ENTITY], R/o Near DDA Flats, VPO Bakarwala, Nagloi, Delhi-110085. Accused 17.09.2014 Order on Sentence:-
Ld. counsel for the accused has submitted that the accused in the present case is the sole bread earner of the family. His family consisting of his wife, two children and widowed mother as well as a younger brother are dependent upon him. It is further submitted that there is no previous criminal case pending against the accused and it is also submitted that he earns Rs. 7,000/- per month. Thus, the accused has prayed for a lenient view.
On the other hand ld. counsel for the complainant has argued that the accused belong to a family which owns the maximum agricultural land in his village. The accused owns several other properties in his village which have been given on rent. It is submitted that the rental income from these properties is around Rs. 2 lacs per month. The accused is also running travel agency and he is also a builder. It is also submitted by the Ld. Counsel for the complainant that the accused has used a forged and fabricated document in his defence. It is thus prayed by the ld. Counsel for the complainant that the accused be punished stringently with the maximum sentence of imprisonment permissible and heavy compensation be awarded to the complainant.
It is necessary to be mentioned here that the offences u/[SECTION] of [ACT] are on high rise and in order to keep the spirit of the legislation, the accused cannot be released on probation as these offences have massive effect on the economic condition of the persons.
I have heard the arguments led by both the counsels on behalf of the parties. Keeping in view, the points put forth by both the parties and considering the submissions of the accused and sufferings of the complainant, I feel the ends of justice will be met if the accused is sentenced to undergo simple imprisonment of three months and is ordered to pay the compensation of Rs.4,50,000/- to the complainant and in case of failure to pay the amount, the accused shall undergo further simple imprisonment of two months. Accordingly, sentence stands passed.
[ENTITY] MM NI ACT (WEST),DELHI 17.09.2014