IN THE COURT OF METROPOLITAN MAGISTRATE MUNICIPAL MAGISTRATE01, KKD, EAST, NEW DELHI Presided by : Ms. [ENTITY] Complaint No. 594/13 Unique ID No. 02402R0240552013 PS: Preet Vihar Sh. [ENTITY] S/o Late Sh. Jagan Nath Malhotra R/o 48A, South Anarkali, Delhi110051 Complainant VERSUS Mr. [ENTITY] S/o Sh. [ENTITY] R/o 26/27, East Punjabi Bagh, Delhi Accused Complaint under [SECTION] of the Negotiable Instruments Ac t Offence complained of : U/[SECTION] [ACT] Date of commission of offence : 05.07.2013 Plea of Accused : Not guilty Final Arguments heard & Concluded on : 27.03.2015 Date of decision of the case : 21.04.2015 Final Order : Acquittal BRIEF FACTS AND REASONS FOR DECISION OF THE CASE:
1 Vide this Judgment I shall finally dispose off this complaint U/[SECTION] [ACT] by complainant [ENTITY] against the accused [ENTITY]. The complainant's story in brief is that in the month of November 2012 the accused had taken a friendly loan of Rs.18,50,000/ from the complainant and in order to discharge the liability of Rs.18,50,000/ towards the complainant, the accused issued an undated cheque bearing no. 000337 of Rs.18,50,000/ drawn on Kotak Mahindra Bank, Panjabi Bagh branch in favor of the complainant and had assured the complainant that the same shall be honored on its presentation. The said cheque was presented by the complainant which was returned vide return memo dated 24.05.2013 with endorsement of " FUNDS INSUFFICIENT ". Thereafter the complainant issued legal notice. The complainant has also stated that despite service of the legal notice the accused did not make any payment in discharge of his liability.
2 After the filing of the complaint and closing of presummoning evidence, vide order dated 16.08.2013, summons were issued to the accused for the offence U/[SECTION] [ACT]. The accused was admitted to bail on 08.10.2013 which was confirmed on 12.12.2013. Thereafter notice U/[SECTION] [ACT] was framed upon the accused on 08.10.2013 to which he did not plead guilty and claimed trial.
3 Application U/[SECTION] [ACT] was filed by the accused on 01.11.2013, which was allowed vide order dated 12.12.2013. Thereafter the matter was fixed for CE.
4 In order to prove its case, the complainant examined himself as CW1 who reiterated the contents of the complaint on Oath and filed evidence by way of affidavit. CW1 exhibited original cheque bearing no. 000337 as Ex. CW1/1, return memo dated 24.05.2013 as Ex. CW1/2, legal notice as Ex. CW1/3, Speed post receipt as Ex. CW1/4, net tracking report as Ex. CW1/5. Thereafter CW1 was cross examined and discharged on 20.02.2014. During crossexamination the complainant has also exhibited reply of the legal notice by the accused as Ex.
CW1/DA, loan agreement Ex. CW1/DB, ITR for 201213 Ex. CW1/DC, copy of agreement to sell Ex. CW1/DD, copy of legal notice sent by one [ENTITY] as Ex. CW1/DE and reply of the complainant as Ex. CW1/DF. Thereafter, the complainant was cross examined and complainant evidence was closed.
5 After that on 15.03.2014 the accused was examined U/[SECTION] [ACT] and his statement was duly recorded. All the incriminating evidence were put to the accused, to which the accused denied taking any loan of Rs.18,50,000/ from the complainant. He deposed that he was a property dealer in respect of a deal for property bearing no. A94, Sudarshan Park, New Delhi in which the complainant had made a payment of Rs.11,00,000/ to the seller, however, the deal could not be finalized but by that time the seller Smt. [ENTITY] had utilized that amount by giving bayana to someone else, on that complainant asked him to issue a security cheque, hence, he issued the cheque in question as security to the complainant in blank signed condition. He further stated that he had received the legal notice from the complainant and had also replied the same. The accused also stated that he wanted to lead defence evidence. Thereafter, defense evidence was led U/[SECTION] [ACT] as the accused had voluntarily closed his evidence on 25.08.2014.
6 Thereafter the accused examined Sh. [ENTITY] as DW1 U/[SECTION] [ACT] who admitted his signatures at point 'A' on Ex. CW1/DD(colly). Thereafter DW1 was cross examined and discharged on 23.01.2015. Defense evidence was closed vide separate statement of the accused and the matter was listed for final arguments.
7 Final arguments were addressed on behalf of the complainant. Counsel for the complainant has argued that the accused has failed to disclose any defence as no evidence has been led to show that the accused was not liable towards the complainant for the cheque amount. He has also argued that the complainant has proved all the necessary ingredients for offense U/[SECTION] [ACT] and therefore, the accused is liable to be convicted for the said offense.
8 On the other hand, the Counsel for the accused has filed written arguments stating that the complainant has failed to prove the alleged loan advanced to the accused and therefore, no case is made out against the accused. He has further stated in his written arguments that the cheque in question was given as security in blank signed condition to the complainant. Counsel for the accused has also relied upon the following judgments:
a) [PRECEDENT] dated 11.01.2008,
b) [PRECEDENT] SC
c) [PRECEDENT] dated 04.01.2013
9 Arguments advanced by both the parties have been heard at length. I have also perused the judicial record.
10 For offence U/[SECTION] [ACT] the necessary ingredients to be proved are:
a) That the accused had legally enforceable liability / debt towards the complainant.
b) That the accused issued a cheque in discharge of the said legal liability / debt.
c) That the accused was maintaining a bank account for the cheque issued by him.
d) That the cheque was presented by the complainant within its validity period.
e) That the cheque was dishonored on his presentation.
f) That the complainant issued legal demand notice within 30 days from the date of dishonor of the cheque.
g) That the accused failed to pay within 15 days of receipt of legal demand notice.
If the above ingredients are proved then an offence punishable U/[SECTION] [ACT] is committed.
11 In the present case, the accused has stated in the notice framed U/[SECTION] [ACT] that he had received the legal notice from the complainant and had infact even replied to the same. Hence, the only disputed question to be decided is whether the cheque in question was issued in discharge of legally enforceable liability / debt to the complainant.
12 Now the question of liability of the accused to pay the complainant shall be dealt with. In the present case the complainant has averred that the cheque in question was issued against discharge of liability arising out of a friendly loan transaction between the parties. Since the cheque in question is bearing the name of complainant and the present complaint has been filed by the complainant in his own name therefore, presumption arises U/[SECTION] & [SECTION] [ACT] in favour of the complainant that the cheque was issued in discharge of a legal liability. Thus, the onus to rebut this presumption is on the accused. The accused has disputed his legal liability to make payment on the ground that there was no such loan transaction between the parties and that the cheque in question has been misused by the complainant.
13 It is true that for offence U/[SECTION] [ACT], the accused is not expected to prove his defense beyond reasonable doubt in order to rebut the statutory presumption. Same has been held by Hon'ble Supreme Court in [PRECEDENT]. It is also well settled law that in order to rebut the statutory presumption in favour of the complainant, the accused need not examine himself in evidence or adduce any other defence evidence also. The accused can rebut the statutory presumption on the material already available on record. The same has been held by the Hon'ble Supreme Court in [PRECEDENT]. Now it will have to be examined whether the accused has been able to rebut the statutory presumption U/[SECTION] & [SECTION] of [ACT].
14 From the perusal of record, it appears that the complainant has not approached this court with clean hands as the complainant has failed to file the reply of the accused to legal notice sent by the complainant, which is Ex. CW1/DA. The complainant has stated in his crossexamination that the said legal notice was received by the complainant on 07.10.2013, which was after filling of the present case. However, the complainant did not even placed the said reply Ex. CW1/DA on record even after receiving the same on 07.10.2013 and this fact is brought to in light only during crossexamination of the complainant.
15 Furthermore, the complainant did not placed on record a very important piece of evidence at the time of filling the present complaint, i.e. the loan agreement Ex. CW1/DB. The same was produced during crossexamination of the complainant on 20.02.2014. The complainant has heavily relied upon Ex. CW1/DB to state that the accused is liable for the cheque amount towards the complainant. The said loan agreement had admittedly being executed after giving the alleged loan in November 2012. the complainant has stated in his cross examination that the said loan agreement was executed only because the complainant loss faith in the accused when the accused kept delaying making the payment to him in January and February 2013. however, it is important to note that the said agreement Ex. CW1/DB does not mention the exact date of the said loan transaction. Although the complainant has mentioned the exact date of loan transaction in his crossexamination i.e. 09.11.2012, however, the said date has neither been mentioned in the complaint nor in legal notice sent to the accused nor in evidence by way of affidavit and nor in alleged loan agreement Ex. CW1/DB and hence, appears to be an improvement on part of the complainant at the time of his crossexamination. This is a material improvement in the testimony of the complainant as the factum of alleged loan transaction itself became circumspect without the date of the alleged loan transaction being mentioned in any of the documents, or complaint or evidence by way of affidavit filed by the complainant. Further, the complainant has also failed to mention the date on which the accused had approached him for the alleged loan, thereby making the alleged loan transaction itself doubtful. The same has been held by Hon'ble Andhra Pradesh High Court in [PRECEDENT] in [CASE NUMBER] decided on 26.06.2007. The Hon'ble Supreme Court has also held in [PRECEDENT], that "
so much so, the complaint does not even indicate the date on which the loan was demanded and advanced. It is blissfully silent about these aspects thereby making the entire story suspect ". The same has also been reiterated by the Hon'ble Supreme Court in [PRECEDENT]
16 Furthermore, perusal of Ex. CW1/DB reveals that it states as under:
" That for the surety of the above said loan amount the first party has given one post dated cheques bearing Nos.
(1) 18,50,000/ VIDE Ch. NO. 000337, DATED 11/03/2013, DRAWN On KOTAK MAHINDRA BANK, CLUB ROAD, PUNJABI BAGH, NEW DELHI, to the second party and the second party has taken the same from the first party under her own control "
The above clearly shows that the cheque in question was given as surety / guarantee / security, which is shown by the document relied upon by the complainant himself. Furthermore, the complainant has admitted in his crossexamination that the cheque in question was received undated from the accused. The complainant has also stated in his complaint that the cheque in question had been received undated from the accused. The fact that the cheque in question was given undated by the accused clearly shows that the accused had given the cheque in question for security.
17 In view of the above the judgment of Hon'ble Supreme Court in [PRECEDENT], is applicable to the present case. The Hon'ble Supreme Court had held that if a cheque had been issued for security, then no offense U/[SECTION] [ACT] is made out against the accused. In the instant case, since the documents relied upon by the complainant himself clearly established that the cheque in question was issued for security, the accused is liable to be acquitted on this ground alone.
18 The complainant has also relied upon his ITR for the year 201213 Ex. CW1/DC to show that he had disclosed the alleged loan amount of Rs.18,50,000/ in his ITR. However, in the said ITR, it is not shown by the complainant that the loan of Rs.18,50,000/ was given to the accused only and further no names or amount have been mentioned in the column for ' Sundry debtors ' in Ex. CW1/DC. Hence, no reliance can be placed upon Ex. CW1/DC to prove that the alleged loan of Rs.18,50,000/ was actually advanced to the accused only and not to any other person.
19 It is also pertinent to note that the accused has remain consistent through out in his defense, which has been reiterated in the notice framed U/[SECTION] [ACT], application U/[SECTION] [ACT] filed on behalf of the accused, statement recorded U/[SECTION] [ACT] as well as in his defense evidence. Nothing has come on record which discredits the defense of the accused, while on the other hand the complainant has materially improved his case by filling important documents at the time of crossexamination and mentioning the date of alleged loan transaction only during crossexamination.
20 In view of the above discussion, the complainant has been unable to prove the ingredients of offense U/[SECTION] [ACT]. The accused has been able to prove his defense. Since the complainant himself has admitted that the cheque in question was for security through the document Ex. CW1/DB relied upon by him, hence, the defence of the accused that the cheque was given for security to the complainant and that the same has been misused appears to be probable and credible defence. It is well settled that even though the statutory presumption for offence U/[SECTION] [ACT] is in favour of the complainant, still, the prosecution is burdened with standing on its own legs and has to necessarily prove its case beyond reasonable doubt. Considering the entire facts and circumstances of the present case, the accused can not be held to be guilty of offense U/[SECTION] [ACT]. Accordingly, accused Mr. [ENTITY] S/o Sh. [ENTITY] R/o 26/27, East Punjabi Bagh, Delhi stands acquitted of the offence under [SECTION] [ACT].
Accused is directed to furnish bailbond and surety bond in the sum of Rs.10,000/ U/[SECTION] [ACT] for the next Six month.
Announced in the open court today i.e. 21.04.2015 ([ENTITY]) MM:KKD:DELHI: 21.04.2015
Containing 9 pages all signed by the presiding officer.
([ENTITY]) MM:KKD:DELHI: 21.04.2015