IN THE COURT OF SHRI DEEPAK KUMAR, MM03 (NI ACT) SOUTHWEST DISTRICT: NEW DELHI C.C No. 335/15 Unique case ID No. 02405R0028102015 under [SECTION] of [ACT] In the matter of : Sh. [ENTITY], S/o Sh. Om Prakash, R/o VPO Ghumanhera, New Delhi110073. Complainant Verses Sh. [ENTITY], S/o Sh. Bishan Chand, R/o VPO Ghumanhera, Near Chari Wala Johar, New Delhi110073. Accused [ENTITY] Vs. [ENTITY] CC No. 335/15 Page 1 of 25 Date of Institution : 13.03.2015 Date of judgment : 29.02.2016 J U D G E M E N T:
1. Vide this judgment, I shall dispose off the present complaint under [SECTION] [ACT] (hereinafter referred to as the '[ACT]') filed by the complainant against the accused.
2. The brief facts of the case as averred by the complainant in his complaint are that accused has availed a friendly loan of Rs. 2,50,000/ from the complainant and in order to discharge his liability, the accused issued a cheque bearing no. 015952 dated 27.01.2015 in sum Rs. 2,50,000/ drawn on Allahabad Bank, Village Ghumanhera Branch, New Delhi110073 in favor of the complainant which was returned unpaid vide returning memo report dated 29.01.2015 with the remarks "FUNDS INSUFFICIENT". Thereafter, the complainant sent a legal demand notice dated 18.02.2015 to the accused through his Counsel by way of speed post. However, as per the complainant, despite service of the said legal notice of the demand, the accused failed to pay the aforesaid dishonored cheque amount. Hence, the present complaint. [ENTITY] Vs. [ENTITY]
3. The cognizance of offence u/[SECTION] [ACT] was taken and accordingly accused was summoned vide order dated 19.06.2015. Thereafter, separate notice u/[SECTION] [ACT], explaining accusations against the accused u/[SECTION] [ACT] was framed on 20.08.2015 to which he did not plead guilty and claimed trial.
4. An application filed on behalf of the accused u/[SECTION] [ACT] seeking to crossexamine CW was allowed. Vide order dated 16.09.2015, CE was closed. On 06.10.2015, statement of accused u/[SECTION] [ACT] was recorded. DE was closed vide order dated 05.02.2016.
5. It is well settled position of law that to constitute an offence under [SECTION] [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;
[ENTITY] Vs. [ENTITY]
(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;
(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 30 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.
[ENTITY] Vs. [ENTITY]
6. 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] of the [ACT].
7. I have heard both the parties and gone through the record. The following questions arise for my consideration in the present case:
(i) Whether the defence of the accused of other particulars of the cheque in question, except his signatures, being filled by some one else is a valid defence in the eyes of law.
(ii) Whether the cheque in question has been issued for the valid discharge of legally recoverable debt or liability .
(iii) Whether the legal demand notice was served by the complainant upon the accused.
Discussion on question (i) and finding thereon
8. Lets examine if the defense taken by the accused that the particulars, except the signature in the aforesaid cheque, had not been filled by him, is of any help to him.
[ENTITY] Vs. [ENTITY]
9. [SECTION] [ACT] provides for "inchoate stamped instruments" and states that if a person signs and delivers a paper stamped in accordance with the law and "either wholly blank or have written thereon an incomplete negotiable instrument" such person thereby gives prima facie authority to the holder thereof "to make or complete as the case may be upon it, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp."
10. The position in law has been explained in the judgment of the Division Bench of the Hon'ble Kerala High Court in [PRECEDENT] in the following words:
"In the instant case, signature is admitted. According to the drawer of the cheque, amount and the name has been written not by the drawer but by somebody else or by the payee and tried to get it encashed. We are of the view, by putting the amount and the name there is no material alteration on the cheque under [SECTION] of the [ACT]. In fact there is no alteration but only adding the amount and the date. There is no rule in banking business that [ENTITY] Vs. [ENTITY] payee's name as well as the amount should be written by drawer himself. "
11. The above judgment was quoted with agreement by the Hon'ble Delhi High Court in [PRECEDENT] and it was held that if the signatures on the cheque are admitted by the accused, it matters little if the name of the payee, date and amount are filled up at a subsequent point in time.
12. In view of the judgments discussed above, the contention of the Ld. Defense Counsel that other columns in cheque, except the signature, were not filled in by the accused does not have any force in the eyes of law. Further it has been also the defense of the accused that cheque in question i.e. ExCW1/A has been misused and misappropriated by the complainant as accused lost his bag containing the cheque in question.
13. The signature on the impugned cheque has been admitted by the accused. However, It has been argued on behalf of the accused that the complainant took away his bag containing the cheque in question alongwith other articles namely, HCL Laptop and one Samsung Mobile Phone and subsequently misappropriated the same by filling the particulars of the cheque. Per contra, it has been argued by the Ld. [ENTITY] Vs. [ENTITY] Counsel for complainant that the accused did not immediately lodge any police complaint or approach any authority regarding the alleged misplacement or misappropriation of any such stolen cheque. Same has been countered by the Ld. Counsel for accused by submitting that accused has lodged a police complaint i.e. ExDW1/B and earlier on account of mutual trust and confidence, accused did not immediately prefer to approach any enforcement authority.
14. I have carefully considered the above submissions. First and foremost, let me discuss the version of the alleged theft of the cheque. It has been contended on behalf of the accused that the complainant managed somehow to get the blank signed cheque in question after removing the bag of accused containing the cheque in question along with other articles. In this regard it seems important to mention here that the sagacity of any prudent person placed in similar situation demands the immediate action which may be in the form of police complainant or approaching any enforcement authorities, startlingly in this case accused did not make any swift action and questionably remained dormant for quite long period and admittedly, get lodged the police complaint i.e. ExDW1/B only after receiving the summons in the present case. Neither any mandate was given to the concerned bank authority for stopping the payment. Accused has remained conspicuously silent in the intervening [ENTITY] Vs. [ENTITY] period. This itself imperils the case of the accused as far as the story of stolen cheque is concerned. It seems purely an afterthought and the figment of imagination which was intended to fill the lacuna in the case of the accused and accordingly the same cannot be relied upon.
Discussion on question (ii) and finding thereon
15. First, it appears pertinent to mention here the provisions of [SECTION] of the [ACT] which inter alia provides that it shall be presumed, until the contrary is proved, that every negotiable instrument was made or drawn for consideration. [SECTION] of the [ACT] stipulates that unless the contrary is proved, it shall be presumed, that the holder of the cheque received the cheque , for the discharge of, whole or part of any debt or liability. The said presumptions are rebuttable in nature.
16. In [PRECEDENT], three Judge Bench of Hon'ble Supreme Court held that [SECTION] raises a presumption of existence of legally enforceable debt or liability and not simple existence of debt or liability. This presumption is rebuttable presumption and it is open to the accused to raise a defense wherein the existence of legally enforceable debt or liability can be contested. [ENTITY] Vs. [ENTITY]
17. It has been held in [PRECEDENT] that the accused may rebut these presumptions by leading direct evidence and 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. Further, the burden may be discharged by the accused by showing preponderance of probabilities and the onus on the accused is not as heavy as it is on the complainant to prove his case.
18. As, discussed above, it becomes amply clear that the accused does not need to discharge his or her liability beyond the shadow of reasonable doubt. He just needs to create holes in the case set out by the complainant. Accused can say that the version brought forth by the complainant is inherently unbelievable and therefore the prosecution cannot stand. Or the accused can give his version of the story and say that on the basis of his version the story of the complainant cannot be believed. In the first situation the accused has nothing to do except to point inherent inconsistency in the version of the complainant.
19. So far as the factum of liability is concerned, in view of the mandatory presumptions of law as discussed above if an accepted signed [ENTITY] Vs. [ENTITY] cheque has been produced by the complainant, then there cannot be any inherent lacuna in the existence of liability. But then definitely accused can create some loopholes in the story of the complainant by impeaching the credit of witness during the cross examination. The strength of standards on the accused is not as high as placed and desired from the complainant. Accused can discharge its burden by demonstrating the preponderance of probabilities coming in its way.
20. Now, coming to the present case in hand, It has been the de fense of the accused that accused has never taken the alleged loan of Rs. 02,5,00,00/ from the complainant and thus cheque in question i.e. CW1/A is without consideration. It has been further argued that com plainant was neither capable nor in possession of sufficient funds to ad vance such a huge loan. Reliance in this regard has been placed upon the judgment of Hon'be Supreme Court in the case titled as [PRECEDENT]. and the judgment of Hon'ble Delhi High Court in the case titled as [ENTITY] and Anr vs. Vijay kalra 2014 (2) CLJ 596 Del. Same has been countered by the Ld Counsel for the complainant by submitting that cheque in question has been issued against valid consideration. During final arguments, he assert [ENTITY] Vs. [ENTITY] ed that complainant has other source of income as well. Lets examine the same in the light of the facts and circumstances of the present case.
21. The quintessence of the submissions made by the ld counsel for the accused appears to be focused on the point that it was not enough for the cheque to have been issued and the same to have been dishonored, it was also for all its intents and purposes mandatory to establish that cheque was issued for discharge, in whole or in part for any legally en forceable debt or liability. Appreciation of the above contention warrants the discussion of the provision of [SECTION] and [SECTION] of the [ACT].
22. [SECTION] of the [ACT] reads as under:
"[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 na ture referred to in [SECTION] for the discharge, in whole or in part, of any debt or other liability."
23. In criminal trial where accused is subjected to intense scrutiny and his life and liberty is placed under scanner, it is all necessary that the execution of cheque against the alleged loan should be proved with evidence of irrevocable nature and of impeccable character. Mere production of cheque can not made the case of the complainant sacrosanct [ENTITY] Vs. [ENTITY] and absolute so as to exempt him from all blemishes and burdens. It is trite to say that Cheque as an instrument is very prone to be misused and thus it becomes all necessary for complainant to come up with cogent and convincing evidences to win over the confidence of the court.
24. In [PRECEDENT]. decided on 30.06.2011, Hon'ble High Court of Kerala while considering the issue of difference between execution and issuance of cheque,has held as follows: "On consideration of the various aspects and provisions of the Act,I am of view that the contention raised by a accused in a prosecution under [SECTION] of the act that he issued a blank signed cheque will not amount to admission of execution of cheque. A signed blank cheque leafs very often referred to as a blank 'cheque',but strictly speaking it is not a 'cheque', as defined under the Act. It can be treated only as a containing admitted signature of the accused. The admission of signature on cheque leaf alone will not constitute admission of execution of the cheque. The argument that accused admitted [ENTITY] Vs. [ENTITY] 'execution of the cheque in the reply notice etc. cannot therefore be accepted."
" The prosecution shall however make clear to court ,each of the circumstances relied upon by it, to establish drawing of the cheque by the accused. The mere fact that the cheque produced in the court came from possession of complainant alone will not be sufficient to prove execution, even though it may be one of the circumstances. No laws allow a court to presume that the cheque which is produced and marked in the court was handed over or delivered to complainant by the accused. The court can at best say that the cheque was in the possession of the complainant. But under what circumstances it came to his possession is to be stated by the complainant. In the absence of such statement, court cannot proceed on any assumption that it was handed over to complainant by accused."
[ENTITY] Vs. [ENTITY]
25. Now coming to the present case in hand. Admittedly complainant is driver by profession who earned Rs.12 thousands per month for the period of 09 months in the year 2014 and received the same directly in his account. He further claimed to have earlier employed in Maruti company as Line Man and received the salary of Rs. 8,500/per month directly in his account. He also stated to be married and having one son aged about four years. During his cross examination dated 16.09.2015, he also sated to be residing separately from his parents from last six months. Complainant has not disclosed the source of income in his complaint, neither the mode of payment has been mentioned.
26. Admittedly, no written agreements or promissory note was executed against the alleged loan in question. Complainant has not disclosed if the alleged amount of Rs. 02,50,000/ was withdrawn from the bank or the same was lying with him in cash. The conspicuous silence of complainant makes the case of the complainant highly doubtful. It appears quite unlikely that the person earning such a modest income would keep such a huge amount of Rs. 02,50000/ in cash in his home instead of investing the same in bank. Doubt gets bigger and murkier in the backdrop of the claim of the accused regarding the advancement of interest free loan as the same militates against the standards of ordinary prudent person.
[ENTITY] Vs. [ENTITY]
27. Despite of specific suggestion controverting the claim of the complainant, he failed to brought on record any evidence to corroborate his assertion of advancing the loan to the accused Complainant admitted of having not in possession of any receipt against the alleged advancement of loan in question except the cheque. He also did not examine any independent witness to substantiate his claim. In complaint, complainant has stated to have received cheque in question from accused after the six months of advancement of loan in question. Thus, it is plainly clear that complainant did not take any security against the alleged loan in question. It appears quite unbelievable that a person earning meager income and having family to support would venture out in advancing such a huge amount of 02,50,000/ without securing any receipts or executing any written agreements and without any interest. The incredulity and indigestibility gets deeper further in circumstances of the admission of the accused that he was not in visiting terms with the accused except visiting the shop of the complainant for recharging purpose. The claim appears to be highly doubtful.
28. It's quite normal for ordinary prudent person to remain assiduous and watchful while humoring into financial transactions. In ordinary course of human nature, money matters are considered sensitive enough to demand alert and attentive attendance of human psyche. The [ENTITY] Vs. [ENTITY] degree of alertness and attentiveness gets bigger and sharper with the increase in the amount and the fragile financial status of the lender which are inversely proportional to each other. Here in the present case, when a huge amount of money has been alleged to be advanced, it's all natural for the complainant to come forth with reliable and credible evidence. But, accused has remained questionably inert and indolent in bringing forth any plausible evidence to win over the confidence of the court.
29. Complainant was found amiss in examining any witness before whom loan was advanced. The mode of payment has been not disclosed, neither the source from which alleged money arranged to be advanced has been disclosed. It appears quite indigestible and implausible to believe that complainant would advance loan to the tune of Rs. 02,50,000/ without any written contracts, in the absence of any witness and without securing its repayment. These facts along with the attending circumstances make way for the entire case set out by the complainant to get enveloped and enamored into the inscrutable smokes of doubt.
30. In [PRECEDENT], Hon'ble Supreme Court Of India found the requirement of the complainant to establish his financial capacity to lend money relevant in cases u/[SECTION] of [ACT].
[ENTITY] Vs. [ENTITY]
31. Similarly in [PRECEDENT], It has been held as follows: " It has to be stated that in order to draw presumption under [SECTION] along with [SECTION] of [ACT], the burden was heavily upon the complainant to have shown that he had the required funds for having advanced the amount to the accused ; that the issuance of the cheque in support of the said payment advanced was true and that the accused was bound to make the payment as had been agreed while issuing the cheque in favor of the complainant"
32. Reliance in this the regard can also placed on the judgment of Hon'ble High Court of Delhi in the matter titled as [PRECEDENT]. ,in which it has been held as follows: "The Court finds some merit in the observation made by the learned ASJ that the petitioner had not [ENTITY] Vs. [ENTITY] been able to prove any of the three sources of money though he had specifically mentioned the same in his deposition .In fact, failure on his part to prove any entry in his bank account showing withdrawal of any amount during the relevant period created a reasonable doubt about the consideration for the cheque in question "
" However once burden of proof had shifted back to petitioner/complainant, he was unable to prove his case beyond reasonable doubt by establishing the source of alleged friendly loan extended to respondent No.2 ,thus disentitling him to grant of relief on basis of the negotiable instruments "
33. Reliance in this regard can also placed upon the judgment of Hon'ble Delhi High Court in [ENTITY] case(supra).
34. It is all more significant that presumption can only be raised in furtherance of prosecution case and not in derogation of the same. The three judge bench of Hon'ble Supreme Court in a case while dealing with [ENTITY] Vs. [ENTITY] Prevention of Corruption Act has observed in respect of presumption of law in '[PRECEDENT] as under: " the presumption therefore can be used in furtherance of the prosecution case and not in derogation of it. If story set up by the prosecution inherently militates against or is inconsistent with the fact presumed, the presumption will be rendered sterile from its very inception"
35. Thus, in view of the totality of circumstances and the settled legal positions as discussed above, the case attempted to be built by the complainant, appears to be suffering from fatal infirmities so much so that it goes directly to the root of the case and shakes the very edifice on which the case of the complainant rests. It is also relevant to mention here that the criminal conviction entails enigmatic and stigmatic exposures and experiences and thus it becomes of paramount importance to demand evidence of unimpeachable character and of unambiguous nature.
36. In the case of '[PRECEDENT], decided on 04.01.2013 Hon'ble Delhi High Court has held that the basic principle in criminal law is that the guilt of the respondent/accused must be proved beyond reasonable doubt and if there [ENTITY] Vs. [ENTITY] is any slightest doubt about the commission of an offence then the benefit has to accrue him.
37. Therefore, considering the above mentioned facts and legal positions, it won't be unjustified and completely misplaced to say that the complainant has miserably failed to prove if the impugned cheque has been issued against the discharge of any enforceable debt or liability or if the loan was given for consideration. Preponderance of probabilities lies completely in favour of the accused . Further, the case of the complainant is required to rest on its own leg and the same can not be allowed to be bypassed in casual and cosmetic manner.
38. In view of the above discussion, I hold that the complainant has failed to prove if the cheque in question has been issued in discharge of any legally enforceable debt or liability. Accused has been able to rebut presumptions u/[SECTION] and [SECTION] [ACT] arising in favour of the Complainant.
39. The accused is entitled to acquittal on this ground alone and the remaining question become only of academic importance. However, in the interest of justice, I proceed to give my finding on the same.
Discussion on question (iii) and finding thereon [ENTITY] Vs. [ENTITY]
40. It is the also defense of the accused that he did not receive any legal notice from the Complainant. The same may now be considered.
41. [SECTION] of the [ACT], which raises a presumption of service by post, reads as under:
"Meaning of service by post Where any (Central Act) or Regulation made after the commencement of this Act authorizes or requires any document to be served by post, where the expression "serve" or either of the expressions "give" or "send" or any other expression in used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing prepaying and posting by registered post, a letter containing the document, and unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post."
[ENTITY] Vs. [ENTITY]
42. In [PRECEDENT] it has been held that [SECTION] gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It was further held as follows: "Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under [SECTION] of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under [SECTION] of the Act, cannot obviously contend that there was no proper service of notice as required under [SECTION], by ignoring statutory presumption to the contrary under [SECTION] of the [ACT] and [SECTION] [ENTITY] Vs. [ENTITY] of the [ACT]. In our view, any other interpretation of the proviso would defeat the very object of the legislation." (para 17)
43. Coming to the facts of the present case, the legal notice Ex.CW1/C dated 18.02.2015 was sent to the accused at his following address:- Sh. [ENTITY], S/[ENTITY], R/O VPO, Ghumanhera, Near Chari Wala Johar, New Delhi110073 through Speed Post receipt Ex.CW1/D and Ex.CW1/E dated 18.02.2015. This is the same address on which summons was issued to accused which received back duly served upon him and in pursuance of the same, accused appeared in the court. In these circumstances, presumption u/[SECTION] [ACT] arose in favour of the complainant. It was for the accused to rebut the above presumption by examining a witness from the Postal Department/ the Postman concerned to show that the legal notice was never served upon him. However, he chose not to do so.
44. In view of the above discussion and the legal position emerging from [PRECEDENT] (supra), I hold that the legal notice is deemed to have been served upon the accused.
45. I have already held in answer to question (ii) above that the complainant has failed to prove his case. Accused has been able to rebut [ENTITY] Vs. [ENTITY] presumptions u/[SECTION] and [SECTION] [ACT] arising in favour of the Complainant. Accordingly, accused Sh. [ENTITY] is acquitted of the offence under [SECTION] of the [ACT].
46. Bail Bond furnished u/[SECTION] [ACT] is already on record. Announced in the open Court on 29th Day of February 2016 ([ENTITY]) MM03 ([ACT])/SouthWest Dwarka/ New Delhi [ENTITY] Vs. [ENTITY]