IN THE COURT OF SHRI [ENTITY], M.M (CENTRAL): TIS HAZARI COURTS, DELHI CC No. : 534979/16 U/s : 138 [ACT] P.S : Hauz Qazi [ENTITY] vs [ENTITY] JUDGEMENT
1. Sl. No. of the case : 534979/16 2. Date of institution of the case :30.01.2010 3. Name of complainant : [ENTITY], W/o Sh. Kishan Prakash, R/o H. No. 1694, Himatgarh, Sita Ram Bazar, Hamdard Asaf Ali Road, New Delhi-110006. 4. Name of accused, parentage & address : Sh. [ENTITY] S/o Late. Sh. Ballo, R/o H. No. 1697, Hamdard Asaf Ali Road, Sita Ram Bazar, Himatgarh, Delhi-110006. 5. Offence complained of or proved : 138 [ACT]. Plea of accused : Accused pleaded not guilty 7. Final order : Acquittal 8. Date on which order was reserved : 31.07.2018 9. Date of pronouncement : 06.08.2018 [PRECEDENT] 1 /12 [ENTITY] vs [ENTITY] BRIEF REASONS FOR THE DECISION OF THE CASE
1. Briefly stated facts of this case as per the complaint are that the complainant is a law abiding citizen of India and the accused is the neighbour and hence acquaintance of the complainant since long. On account of this acquaintance, the accused took loan in a sum of Rs. 6,00,000/- on different occasions in the month of January, 2009. At the time of taking the said loan amount, the accused had agreed to pay interest @ 2% per month over the said loan amount and further stipulated that he shall return the said loan amount within short period of time. The accused has not paid the interest at the agreed rate against the said loan amount inspite of repeated requests and demands. The accused issued and handed over six cheques to the complainant i.e. cheque bearing no. 509372 dated 19.02.2009, 509375 dated 27.03.2009, 509374 dated 27.03.2009, 509371 dated 04.10.2009, 509373 dated 04.10.2009 and 509376 dated 04.10.2009 each amounting to Rs. 1,00,000/-. All cheques were drawn on Bank of Baroda, Asaf Ali Road, Delhi-02. However, when the complainant presented the cheques bearing no.509372, 509375 and 509376 as per the instruction of accused through her bank i.e. Corporation Bank, LIC Ground Floor, Laxmi Insurance Building, Asaf Ali Road, Delhi, the same were returned unpaid vide return memos dated 28.03.2009. The complainant has contacted the accused number of times, but the accused requested the complainant that he is facing some financial problems and he shall make the payment in cash against the dishonoured cheques in the month of October 2009 and requested the complainant not to file any complaint against the dishonoured cheques. Accordingly, the complainant believed his versions and not file any criminal complaint. In the month of October 2009, the complainant asked the amount against the dishonoured [PRECEDENT] 2 /12 [ENTITY] vs [ENTITY] cheques but the accused was postponing the matter on one pretext to another with a sole motive that the accused want to lapse the mandatory period of six months of the cheques. In the first week of November 2009, the complainant contacted the accused and asked the amount but the accused assured that this time remaining cheques of complainant would certainly be honored but when the cheques i.e. cheque bearing no. 509371, 509373 and 509376 all dated 04.10.2009 amounting to Rs.1,00,000/- (each) were presented to her banker, same were received back unpaid with the remarks "Account Closed" vide return memos dated 13.11.2009. Thereafter, complainant served a legal demand notice dated 07.12.2009 to the accused through registered A.D. and [ACT] on 08.12.2009 at his address. The legal notice was duly received but despite that no payment was made. So, present case was filed under [SECTION] [ACT].
2. On the basis of pre-summoning evidence, accused was summoned for the offence u/[SECTION] [ACT] vide order dated 30.01.2010. Accused put his appearance on 05.05.2011 and thereafter, a notice under [SECTION] [ACT] was framed against him on the same day to which he pleaded not guilty and claimed trial.
3. The complainant adopted her pre-summoning evidence. Complainant has relied upon the documents i.e the original cheques in question i.e. cheques bearing no. 509371, 509373 and 509376 in the sum of Rs. 1,00,000/- each dated 04.10.2009 Ex. CW1/1 to Ex.CW1/3, returning memos dated 11.11.2009 and 13.11.2009 Ex.CW1/4 to Ex.CW1/6, legal notice dated 07.12.2009 Ex.CW1/7, Postal receipt (Ex.CW1/8 to Ex. CW1/10). She has been duly cross-examined by Ld. Defence counsel. Thereafter, CE was closed by the complainant.
4. After conclusion of post-notice, evidence, the statement of accused was recorded under [SECTION] [ACT] in which he stated as under:-
[PRECEDENT] 3 /12 [ENTITY] vs [ENTITY] "I am innocent. I have issued the cheques in question to the complainant as a security. Without date and without amount and only containing my signatures. I have only availed a loan of Rs. 30,000/- from the complainant for six months to be paid by way of installments of Rs. 5,000/- with 10% interest. I received the above said amount in the presence of [ENTITY] and [ENTITY] on 14.06.2006 and I have returned Rs. 30,000/- to the complainant on 01.10.2008 in the presence of [ENTITY] and [ENTITY]. I had been paying 10% interest to her. After making the payment of entire loan amount and interest, I asked for return of my cheques. The complainant said she was busy in the coming marriage of her daughter and later on she will return the cheques to him but cheques were not returned to the accused despite repeated demand. I have nothing to pay to the complainant either on the account of interest or loan amount. I have liability to make any amount as alleged to the complainant as there is no legally enforceable debt exists against me. The present case is filed with the malafide intention of blackmailing to extort money". He did not examine any witness in his defence several opportunities, so, DE was closed vide order dated 27.02.2018.
5. Arguments heard.
Now [SECTION] [ACT] provides as under :-
Dishonour of cheque for insufficiency, etc., of funds in the account- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, or any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for [ a term which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both:
[PRECEDENT] 4 /12 [ENTITY] vs [ENTITY] Provided that nothing contained in this Section shall apply unless
i) 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;
ii) the payee or the holder in due course of the cheque, as the case may be, 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 thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
iii) the drawer of such cheque fails to make payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
So the perusal of the Section shows that complainant has to prove following things in order to prove his case :-
i) the cheque was drawn by the accused for payment of due amount to the complainant;
ii) the amount was due on the part of the accused for discharge of any legally enforceable debt or other liability;
iii) the cheque was returned dishonoured;
iv) the legal notice was given to the accused within stipulated period;
v) even after the receipt of the legal notice, the accused chose not to make the payment.
Ld. Counsel for the complainant has submitted that the complainant has satisfied and proved all the ingredients of the offence under [SECTION] [ACT]. He has further submitted that presumptions under [SECTION] & [SECTION] [ACT] are also there and in view of the aforesaid presumptions, the case of the complainant has been proved. The presumptions mentioned above are as under :-
[PRECEDENT] 5 /12 [ENTITY] vs [ENTITY] [SECTION] [ACT] 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 transferred, was accepted, endorsed, negotiated or transferred for consideration;
b) as to date that every negotiable instrument bearing a date was made or drawn on such date;
c) as to time of acceptance that every accepted bill of exhange was accepted within a reasonable time after its date and before its maturity;
[SECTION] [ACT] Presumption in favor 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, or any debt or other liability.
It has been argued by Ld. Counsel for complainant that signature of the accused on the cheques in question are not disputed. It has also been argued that legal notice was sent to the correct address of the accused. Further, no probable defence has been raised by him. He has prayed for conviction of the accused.
On the other hand, Ld. Defence counsel has submitted that the case of the complainant was highly improbable. It has been argued that complainant has not specified the dates on which the alleged loan was so advanced to the accused herein. It has also been argued that as per the complainant, an amount of Rs. 6 lacs was handed over by her to the accused and accused issued 6 cheques amounting to Rs.1 lac (each) to her. All the cheques were allegedly dishonored on presentation for encashment but surprisingly no legal action has been taken against him for the dishonor of first three cheques and for recovery of amount of Rs. 3 [PRECEDENT] 6 /12 [ENTITY] vs [ENTITY] lacs pertaining to the same. Also, as per the case of the complainant, amount in question was advanced to the accused at the interest of 2% per month without having any money lending license. Prayer has been made for acquittal of the accused.
It is to be seen that the signature of the accused on cheques in question are not disputed. Accused has not specifically denied the service of legal notice. The legal notice was sent to him by registered A.D. and [ACT] (Ex.CW1/8 to Ex.CW1/10). The envelope containing the legal notice was received back unexecuted with the endorsement "unclaimed".However, it is not the case of accused that he was not residing on the address as mentioned on the envelope Ex.CW1/10. In fact same address has been mentioned by him in his bail bond furnish before Ld. Predecessor on 05.05.2011. I am enlightened on this point by the Judgment of Hon'ble Supreme Court of India titled as [PRECEDENT] 18.05.2007 in which it was held as under:
"It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is no stipulation of giving of a notice before filing a complaint. 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 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 alongwith the copy of the complaint under [SECTION] of the Act, cannot obviously contend that there was no proper service of notice as required u/[SECTION], by ignoring statutory presumption to the contrary under [SECTION] of the [ACT] and [PRECEDENT] 7 /12 [ENTITY] vs [ENTITY] [SECTION] of the [ACT]. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in [ENTITY] case (supra), if the giving of notice in the context of clause (b) of the proviso was the same as the receipt of notice a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of [SECTION] of the Act".
(emphasis supplied) The accused has taken a defence (in his statement u/[SECTION] [ACT]) that he had issued the cheques in question to the complainant as security in blank with his signatures only. He also stated that he had availed a loan of Rs.30,000/- only from the complainant on 14.06.2006 in the presence of [ENTITY] and [ENTITY] for six months to be paid by way of installments of Rs.5000/- with 10% interest and he returned the amount of Rs.30,000/- to her in the presence of aforementioned two persons on 01.10.2008. He also claimed that he was paying 10% interest to her and after entire payment of principal amount as well as interest, he asked for return of his cheques which were promised to be returned after the marriage of daughter of complainant as she was busy in the same but same were not so returned and were misused. However, he did not examine himself or any other person as a witness to prove the same. It is settled law that the statement under [SECTION] [ACT] made by accused is not the evidence of accused and it cannot be read part of evidence, in a case under [SECTION] [ACT]. Reliance is placed on Judgment of Hon'ble Delhi High Court titled as [PRECEDENT].
Having said so, it is to be seen that the accused was not required to adduce any conclusive positive evidence to rebut the presumption existing in favour of complainant. The scope of the statutory presumptions in favor of the complainant as existing in the [ACT] and [PRECEDENT] 8 /12 [ENTITY] vs [ENTITY] the evidence required to rebut the same has been explained by Hon'ble Supreme Court of India the judgment titled as [PRECEDENT] as under :
"we are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic life of a developing country like India. This, however, shall not mean that the Courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by [SECTION] should be delicately balance. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same."
(Emphasis supplied) Further in [PRECEDENT], it was held that :-
" accused in a trial under [SECTION] of the Act has two options to rebut the presumptions. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non- existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed.
To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated "
(Emphasis supplied) Standard of proof on an accused as far as his defence in a case under [SECTION] [ACT] is concerned, has been elaborately laid down by [PRECEDENT] 9 /12 [ENTITY] vs [ENTITY] Hon'ble Supreme Court of India in [PRECEDENT] (supra) as under (this Judgment has been relied upon by the complainant) :
"[SECTION] of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While [SECTION] of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under [SECTION] is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by [SECTION] can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under [SECTION], the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
(Emphasis supplied) So, it is settled law that the accused can rely on the material submitted by the complainant to raise his defence.
As per the complainant she had advanced loan of Rs.6 lacs to the accused in January,2009 on different occasions. As per her cross- examination dated 20.08.2014, complainant was unemployed and was not having any business. She also deposed that she was not having any source of income. It is surprising that a lady having no source of income was able to advance loan of Rs.6 lacs to a neighbour. Although, she further stated in her cross-examination dated 26.11.2014 that the amount [PRECEDENT] 10 /12 [ENTITY] vs [ENTITY] of Rs.6 lacs was kept by her in her house from the sale proceeds of her properties but she has not specified any of her properties which were so sold by her at the relevant point of time. Further, she stated in her cross- examination dated 20.08.2014 that she has filed cases against Mr. [ENTITY], Mr. [ENTITY] and Mr. [ENTITY] as they had sold her property and misappropriated the money (mere paise enth liye). In case, the sale proceeds of her property was misappropriated by some persons then it is again questionable as to how the complainant managed to advance amount of Rs.6 lacs from it to the accused.
Further, as mentioned above the amount in question was paid by her to the accused on different occasions. She has not explained as to why the amount was so advanced in installments (specifically when she was having the entire amount in her house). She has also not specified the exact amount of different installments. Also, she did not state the dates on which the amount was so given to the accused. Hon'ble Apex Court in [PRECEDENT]. (Supra) has held on the effect of omission to mention the date on which loan was allegedly advanced, as under:
"In the first place the story of the complainant that he advanced a loan to the respondent-accused is unsupported by any material leave alone any documentary evidence that any such loan transaction had ever taken place. 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. We are not unmindful of the fact that there is a presumption that the issue of a cheque is for consideration. [SECTION] and [SECTION] of the [ACT] make that abundantly clear. The presumption is, however, rebuttable in nature."
Complainant has also not specified in her complaint as to when the cheques in question were received by her from the accused. From bare reading of the complaint, it appears that all the six cheques were given by accused to her in one go but as per her cross-examination dated [PRECEDENT] 11 /12 [ENTITY] vs [ENTITY] 26.11.2014, three cheques were given to her after 1-2 months of the transaction in question and remaining three cheques were given after 5-6 months thereof. She stated in the said cross-examination that the three cheques pertaining to this matter were given as it is and denied the suggestion that apart from signature, all other details were filled by her or by someone else on her behalf. Perusal of cheques in question reveals that the signature on all three cheques are in different handwriting and ink from that of rest of the details. Although, difference in handwriting and ink in itself is not a circumstance against the complainant, however, in the given facts which contains many unanswered questions, same certainly creates doubt in her case. Her failure to explain as to why no action was taken by her for recovering the remaining amount of Rs.3 lacs makes her case more doubtful.
Considering the above, this Court is of the view that the case of complainant is full of doubts and benefit of the same should be given to the accused. Accordingly, accused stands acquitted for the offence under [SECTION] [ACT].
Announced in the open Court on 06.08.2018 ([ENTITY] ) Digitally Metropolitan Magistrate signed by (Central-02), Tis Hazari, Delhi. [ENTITY] Date: 2018.08.09 17:24:45 +0530 [PRECEDENT] 12 /12 [ENTITY] vs [ENTITY]