IN THE COURT OF METROPOLITAN MAGISTRATE MUNICIPAL MAGISTRATE01, KKD, EAST, NEW DELHI Presided by : Ms. [ENTITY] Complaint No. 801/13 Unique ID No. 02402R0328302013 PS: Shakarpur Sh. [ENTITY], S/o Late Sh. Jagdish Prasad, R/o MB132, Shakarpur, Gali No.5, Delhi Complainant VERSUS M/s [ENTITY] through its proprietor Sh. [ENTITY], S/o Late Sh. [ENTITY], R/o H.No. 20, Ground Floor, Radhey Shyam Park, Parwana Road, Delhi51 Accused Complaint under [SECTION] of the Negotiable Instruments Ac t Offence complained of : U/[SECTION] [ACT] Date of commission of offence : 14.09.2013 Plea of Accused : Not guilty Final Arguments heard & Concluded on : 07.04.2015 Date of decision of the case : 05.05.2015 Final Order : Acquittal [CASE NUMBER] page no. 1 /10 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 Sh. [ENTITY] against the accused M/s [ENTITY] through its proprietor Sh. [ENTITY]. The complainant's story in brief is that in the first week of April 2013 at the request of the accused the complainant had given a loan of Rs. 10,00,000/ in cash for the marriage of accused's niece. To repay that loan the accused had issued a PDC cheque bearing no 933756 dated 02.05.2013. Thereafter, again in the last week of April 2013 at the request of the accused, the complainant had given a loan of RS 10,00,000/ in cash to the accused for purchase of crackers from wholesale market for coming Deepawali and to repay the said loan the accused had issued a PDC cheque bearing no 933757 dated 20.05.2013. thereafter, again in the third week of may 2013 the complainant had given a loan of Rs.15,00,000/ in cash to the accused at his request for payment of hospital bills of accused's father in law and to repay that loan the accused had issued a PDC cheque bearing no 933760 dated 20.06.2013. Thereafter again on 24.06.2013 the complainant had given a loan of Rs. 6,00,000/ in cash to the accused at his request for payment of outstanding hospital bills of accused's father in law. The accused had also assured the complainant that he would repaid the loan in cash to him. Therefore, during the period from April to June 2013 the accused had taken total loan of Rs 41,00,000/ from the complainant. Thereafter the complainant had presented cheque bearing no.933757 for Rs.10,00,000/ & bearing no. 933760 for Rs.15,00,000/ with his banker for encashment which were returned vide return memo dated 16.08.2013 with endorsement of "Funds Insufficient". Thereafter the complainant issued legal notice dated 13.09.2013. 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 13.11.2013, summons were issued to the accused for the offence U/[SECTION] [ACT]. The accused was admitted to bail on 17.12.2013.
Thereafter notice U/[SECTION] [ACT] was framed upon the accused on 13.02.2014 to which he did not plead guilty and claimed trial. Application U/[SECTION] [ACT] was filed by the accused on 13.02.2014, which was allowed vide order dated 13.02.2014. Thereafter the matter was fixed for CE.
3 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. 933757 dated 20.05.2013 as Ex. CW1/1, bearing no.933760 dated 20.06.2013 as Ex. CW1/2, return memo dated 16.08.2013 as Ex. CW1/3 & Ex. CW1/4, legal notice dated 13.09.2013 as Ex. CW1/5, Registered post receipts as Ex. CW1/6 & Ex. CW1/7, net tracking reports are Ex.CW1/8 & Ex. CW1/9, reply to the legal notice by the accused as Ex. CW1/10, returned AD card as Ex. CW1/11 & statement of account of the complainant from 01.07.2013 till 15.10.2013 as Ex. CW1/12. Thereafter CW1 was cross examined and discharged.
4 After that on 03.05.2014 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 from the complainant. The accused has further stated that the cheques in question were misplaced and the complainant has misused the same for filling the present complaint. The accused also stated that he wanted to lead defence evidence.
5 Accused examined himself as DW1. He reiterated the defense taken in statement recorded U/[SECTION] [ACT] in his examination in chief. Thereafter DW 1 was cross examined and discharged on 13.10.2014. Thereafter, the accused examined Mr. [ENTITY] as DW2 and Mr. [ENTITY] as DW3, both of whom reiterated the defense of the accused in their respective examination in chief. Thereafter both were cross examined and discharged. Defence evidence was closed and matter was fixed for final arguments.
6 Final arguments were addressed and heard on behalf of both the parties. Ld. Counsel for the complainant has reiterated the averments made in the complaint. He has argued that the accused has failed to disclose any defence. Therefore all ingredients of U/[SECTION] [ACT] stands fulfilled and the accused is liable to be convicted.
7 On the other hand, the Counsel for the accused has argued that the present complaint should be dismissed as there is no legal liability upon the accused to pay the complainant as no loan of Rs.41,00,000/ was ever taken by the accused from the complainant. Infact the accused has stated that he does not even know the complainant and the cheque in question have been stolen from his shop.
8 Arguments advanced by both the parties have been heard at length. I have also perused the judicial record.
9 For offence U/[SECTION] [ACT] the necessary ingredients to be proved are:
a) That the accused had a 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.
10 In the present case, the accused has stated in his notice framed U/[SECTION] [ACT] and statement recorded U/[SECTION] [ACT] that the cheques in question have been signed by him and they pertain to his account but he denied issuing the cheques in question to the complainant. The accused has also admitted receiving legal notice and replying to the same. Hence, the disputed questions to be decided are whether the cheques in question were issued to the complainant and whether the cheques in question were issued in discharge of legally enforceable liability / debt to the complainant.
11 Firstly, the question of issuance of cheques in question to the complainant shall be dealt with. In the present case the complainant has averred that the cheques in question were issued against discharge of liability arising out of loan transaction between the parties. Since the cheques in question are 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 cheques in question were issued to the complainant only for discharge of a legal liability. Thus, the onus to rebut this presumption is on the accused. Secondly, the presumption regarding whether the cheques in question were issued in discharge of legal liability is also in favour of the complainant, the onus of rebutting which is also upon the accused. The accused has disputed his legal liability to make payment on the ground that there was no loan transaction between the parties and that the same has been misused by the complainant.
12 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].
13 The complainant in the instant case has failed to disclose his source of income for the alleged loan of Rs.41,00,000/ advanced to the accused in cash. Furthermore, the complainant has admitted in his crossexamination that he did not withdraw the sum of Rs.41,00,000/ from his bank account as he had that money in cash with himself on account of sale of a plat by him in March 2013. He also deposed that he can produce the document in respect of sale of that plot, but no such document has been produced by the complainant thereafter. He has also stated that no written agreement or receipt was issued for the said loan. It is well settled that the presumption for offense U/[SECTION] [ACT] does not extend to the actual advancement of loan, which is still required to be proved by the complainant. The same has been held by Hon'ble Supreme Court in [PRECEDENT]. Hence, in order to establish commission of offense U/[SECTION] [ACT], the burden of proving the legally enforceable liability / debt is upon the complainant.
14 The complainant has further stated that the entire loan of Rs.41,00,000/ was given in installments to the accused. He stated that the first installment was of Rs.10,00,000/ and then second installment was also of Rs.10,00,000/, the third installment was of Rs.15,00,000/ and the last installment was of Rs.6,00,000/. The complainant has also stated in the complaint that the first two installments had been given to the accused in April 2013 itself and the third and last installments were given in May 2015 and on 24.06.2013 respectively. The complainant has not been able to provide any date for advancement of the first three installments of loan to the accused in his complaint or in his evidence by way of affidavit. He has also not disclosed any date for advancement of loan in his crossexamination. This is a material lacuna in the testimony of the complainant as the factum of alleged loan transaction itself became circumspect without the date of the alleged loan transaction. 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].
15 The complainant has also not been able to explain why he continued to advance further loan when the accused had failed to repay previous loans to the complainant. The complainant has stated in his complaint that the accused had issued post dated cheques for 02.05.2013, 20.05.2013 & 20.06.2013. There is no reasonable explanation put forward by the complainant in his complaint or his evidence by way of affidavit or his crossexamination as to why further loan was advanced on 24.06.2013 when no payment had been received by the complainant from the accused for previous loans. There is also no reasonable explanation for continuous advancement of loan installments when no payment of previous loan installment had been received by the complainant from the accused. Hence, it appears that the complainant has failed to behave like a reasonable prudent person, which makes the advancement of loan itself doubtful.
16 In the instant case the complainant had stated that he has advanced loan as a friendly loan to the accused. The friendly relations have been denied by the accused and the accused has stated in his examination in chief that he had met the complainant for the first time in court itself. The complainant has stated in his crossexamination that he used to go to the shop of the accused to buy wheat flour from his shop. He has also admitted that he did not attend marriage of the niece of the accused as the accused did not invite him for the same. Furthermore, even defense witnesses [ENTITY] and [ENTITY] have stated in their testimony that their never saw the complainant at any family function of the accused or even at the time of death in the family of the accused. All of this leads to a conclusion on the basis of preponderance of probabilities that the complainant does not have friendly relations with the accused, rather was only an acquaintance having a relationship of shopkeepercustomer. Hence, it becomes highly improbable that the complainant would advance such a huge amount of loan to the tune of Rs.41,00,000/ to the accused with whom he did not have any family relations, and that too without charging any interest. All of the above, also create a doubt, on the basis of preponderance of probabilities about actual advancement of the alleged loan of Rs.41,00,000/.
17 The complainant has admitted in his crossexamination as under:
" All these payments were made by me in cash by taking different cheques as security "
Although the complainant has not stated in his crossexamination that the cheques in question were taken as security, but the above deposition along with the admission in the complaint that the cheques in question were received on the same day as advancement of the second installment of Rs.10,00,000/ and third installment of Rs.15,00,000/ leads to the conclusion that the cheques in question were infact issued as security.
18 In view of the above the judgment of Hon'ble Supreme Court in M.S. [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.
19 In the present case, the accused has taken the defense that the cheques in question were stolen from his shop, for which he has also filed a police complaint dated 16.08.2013. He has also examined two defense witnesses in order to substantiate this defense of stolen cheques. However, in the present case the actual defense of the accused need not be scrutinized as even before the court looks into the defense of the accused, the complainant has to establish all the necessary ingredients for offense U/[SECTION] [ACT]. In the instant case, since the cheques in question were admittedly security cheques, hence, the complainant has failed to establish all the necessary ingredients for offense U/[SECTION] [ACT] as the cheques in question were admittedly not meant for discharging any legally enforceable debt / liability.
20 In view of the above discussion, the complainant has been unable to prove the loan transaction and therefore there is no question of any legal liability / debt of the accused towards the complainant and the present complaint is liable to be dismissed on this ground alone. Since the complainant has failed to file any document on record to show the liability of the accused, no source of income shown for advancement of huge loan amount of Rs.41,00,000/, further loan given without payment of previous loan and admission that cheques in question were security cheques, hence, no offense U/[SECTION] [ACT] is made out against the accused. 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. In the instant case, there is no written loan agreement and no written receipt are enough to puncture holes in the complainant's story. Cumulatively, the above circumstances are sufficient to rebut the presumption arising in favour of the complainant U/[SECTION] [ACT]. Accordingly, accused M/s [ENTITY] through its proprietor Sh. [ENTITY], S/o Late Sh. [ENTITY], R/o H.No. 20, Ground Floor, Radhey Shyam Park, Parwana Road, Delhi 51 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. 05.05.2015 ([ENTITY]) MM:KKD:DELHI: 05.05.2015
Containing 10 pages all signed by the presiding officer.
([ENTITY]) MM:KKD:DELHI: 05.05.2015