CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 7 of 15
 12. In order to have the positive outcome in his favour, the complainant was required to show that the cheques in question Ex.CW1/4 to Ex.CW1/6 were given by the accused to discharge his liabilities which was dishonoured via returning memo whereafter the accused had also failed to comply with the requirements of the legal notice Ex. CW1/10. On the other hand, the accused was required to show his defence on the scale of preponderance of the probabilities that he is not liable to pay the amount involved in the present case to the complainant.


In The Court Of Ms.Riya Guha vs Brief Facts Of The Present Case Are ... on 25 June, 2014

13. It is well settled that both the aforesaid presumptions U/s 118 & 139 NI Act are rebuttable in nature and the onus to rebut the same squarely rests upon the accused. The accused can rebut these presumptions not merely by examining his own witnesses but also through the crossexamination of the complainant and his witnesses thereby bringing on record through the entire evidence available on record (inclusive of complainant's evidence and defence evidence, if any), that the complainant has set up a false case, and that their was no existing liabilities between the parties and that the cheque in question was misused. It must be kept in mind that once evidence is brought on record from both sides, it becomes an evidence of the case and court can draw inferences from the said entire evidence either in favour or against any of the parties.
 CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 8 of 15
 14. Preponderance of probabilities is the standard of proof upon the accused to rebut the above presumptions, which is not as high as that of the prosecution whereby the accused is only required to show the existence of a probable defence so as to rebut the above presumptions. If the accused succeeds in raising a probable defence by referring to his own evidence (if any) and from the evidence of the complainant, then the onus would shift on to the complainant, who then would have to show beyond reasonable doubt the existence of consideration/existence of a legally recoverable debt or liability in respect of the cheque in question.


15. It is argued by the Ld. counsel for complainant that from evidence on record, the complainant has proved that cheques in question were signed by the accused which were dishonoured vide bank memos and despite the legal notice accused did not make the payment. It is argued that during the cross examination of complainant nothing material has come out and the complainant has been able to prove his case. It is further argued that accused has failed to discharge the burden upon him to rebutt the presumption in favour of the complainant under the Act.

16. Now the question is whether the complainant proved his case, that whether the amount was legally enforceable debt. Offence under Section CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 9 of 15 138 of the Act is a technical offence and the complainant is only supposed to prove that the cheques issued by the accused were dishonoured, his statement that cheques were issued against liability or debt is sufficient proof of the debt or liability and the onus shifts to the accused to show the circumstances under which the cheques were issued and this could be proved by the accused only by way of cogent evidence.

17. The Ld. Counsel for accused had argued that the the document Ex.CW1/3, that is the statement of account, is a manufactured document and the payment of Rs.6 lakhs has not been reflected in this document. He further argued that there was no written instructions from the accused's side to adjust the amount of Rs.6 lakhs in the account of Ahuja Apparels.


18. 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/evidence on preponderance of probabilities to prove that cheques in question were not supported by consideration and that there was no debt or liability to be discharged by him. However, there is no need 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. At the same time it is clear that bare denial of the passing of the consideration and existence of debt, apparently CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 10 of 15 would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant.

19. The plea of the defence raised by the accused at different stages are inconsistence and contrary to each other. At the time of framing of notice, accused had raised the defence that he has issued the cheques in question to the complainant as a security. During the statement under Section 313 CrPC and during the cross examination of the complainant, the accused has raised the defence that an amount of Rs.6 lakhs was given to the complainant by way of cheque(s), but the complainant had illegally adjusted the amount in the account of the other entity, M/S Ahuja Apparels.

20. Therefore the inconsistent and improved version of defence raised by the accused does not inspire any confidence and does not hold water because the accused has improved his plea of defence at the every stage of trial.


21. In a landmark judgment V.S. Yadav Vs. Reena Crl A No.1136 of 2010 Decided on 21.09.2010 it is observed by Hon'ble High Court of Delhi that a bare definition of cheque shows that cheque is a bill of exchange drawn on specified banker and is an order by drawer on his own agent i.e CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 11 of 15 bank for payment of certain sum of money to the bearer or the order to person in whose favour cheque is drawn. This order of payment by person to the holder of cheque is not made in casual manner just for the sake of fun. This order is made for consideration and that is why Section 139 of NI Act provides that the holder of a cheque is presumed to have received the cheque in discharge of whole or in part of a debt or liability. It was sufficient for complainant to prove the debt and liability by making a statement that the cheques were issued by the respondent for payment of debt. It is further observed that it must be borne in mind that the statement of accused under Section 281 Cr.P.C. Or under section 313 Cr.P.C. is not the evidence of the accused and it cannot be read as part of evidence. The accused has an option to examine himself as a witness. Where the accused does not examine himself as a witness, his statement 281 Cr.P.C. or 313 Cr.P.C. cannot be read as evidence of accused and it has to be looked into only as an explanation of the incriminating circumstances and not as evidence. There is no presumption of law that explanation given by the accused was truthful.


22. If the accused wanted to prove any of the above said plea of defence, he was supposed to appear in the witness box and testify and get himself subjected to cross examination. His explanation that the cheque in question was issued as security and that he has no liability towards CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 12 of 15 complainant qua the cheques in question is not proved by evidence and this is liable to be rejected since the accused did not appear in the witness box to dispel the presumption in favour of the cheque as provided under the Act. Mere suggestion to the complainant or mere explanation given in that statement of accused under section 313 Cr.P.C r/w Section 281 Cr.P.C, does not amount to proof. Therefore the plea as set up is only after thought and is having no factual basis. Hence, the defence version of the accused is suspicious and is unbelievable.

23. The accused has also argued that he has not been served with the legal demand notice. However, the legal demand notice dated 13082009 Ex.CW1/10 was sent to the same address of the accused Arun Singhal which is also mentioned in the memo of the parties of the present case. The accused never disputed the said address at any stage of the trial. Hence in present scenario, there is presumption in favour of the complainant U/s 27 of the General Clauses Act. So, I am of considered view of that accused was duly served by legal demand notice.


24. Therefore, mere pleading not guilty and stating that the cheques were issued as security and were wrongly adjusted by the complainant would not amount to rebutting the presumption raised under Section 139 of N.I Act. In the present case accused has not produced any cogent proof in support of CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 13 of 15 the defence version which makes it improbable that the cheque in question was not issued towards the discharge of legal liability as alleged by the complainant but at the same time strengthens the present complaint case. Further, nothing has been proved by the accused to show that he did not have the legally enforceable liability towards the complainant.

25. Having considered the testimonies the issuance of cheque was not in dispute which were dishonored by bank returning memo. Accused Arun Singhal was served with legal notice through registered post within the stipulated period and despite that no payment has been made by him.

26. Reading of the evidence on record in its entirety, would show that the evidence is not supportive with the innocence of the accused and as such same is liable to be dismissed out rightly. Secondly, accused has not produced any cogent proof in support of his defence on record. This court is of the opinion that the defence set up is neither definitive nor consistent with innocence of the accused. It was sole burden and duty of the accused to prove no liability by raising probable defence when he was defending presumption, which was supporting the dishonoured cheque. The accused has failed to discharge the onus. Thus, this court holds that the accused has not been able to rebut the presumptions under section 139 and 118 NI Act standing in favour of complainant.


CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 14 of 15
 27. Having considered the entire evidence, complainant successfully proved all the essential requirements of Section 138 of the Act. Accordingly, accused is guilty for committing the offence punishable u/s 138 of the Act, he is hereby convicted for the offence under section 138 of the Act.

28. Let he be heard on point of sentence separately on 30.06.2014 Announced in open court on 25.06.2014 (RIYA GUHA) MM (C02) /Delhi 25.06.2014 CC No. 2526/1/11 M/s Aneja Agencies vs M/S R.K. Apparels 15 of 15


Indiabulls Financial Services ... vs . on 27 May, 2014

IN THE COURT OF SH. RAVINDER SINGHII, METROPOLITAN
                         MAGISTRATE (NI) ACT - 07
                       DWARKA COURTS, NEW DELHI.

Case No. : 4750/14
Unique Case ID No: 02405R0132702012

INDIABULLS FINANCIAL SERVICES LTD.
Through its Authorized Representative
Having Registered Office At: F60
Second Floor, Malhotra Building,
Connaught Place, New Delhi.                                          .............COMPLAINANT

                                               Vs.

SUBE SINGH
R/o D1/481, Sultanpuri
Geeta Senior Secondary School
Delhi  110041

Also at:

MCD, Circle No 35, Avatika
Rohini Sector1
Water Tank, MCD Flut
New Delhi                                                               .....................ACCUSED

Date of Institution:                                                            03.07.2012
Plea of the accused:                                                        Pleaded Not Guilty
Date of Reserving Judgment:                                                     19/04/2014
Date of Judgment:                                                               27/05/2014
Sentence/final Order:                                                             Acquitted

                                       JUDGMENT
1. By way of present judgment I shall decide the present complaint case under Section 138 of the Negotiable Instruments Act 1881 (as amended up to date, herein after said as NI Act) filed by the complainant Indiabulls through its authorized representative against the accused Sube Singh S/o Sh. Fateh Singh.

CC No. 4750/14 Indiabulls Vs. Sube Singh Page1 /11 FACTS OF THE PRESENT COMPLAINT CASE


2. The factual matrix as per the allegations in the complaint which are necessary for disposal of the present case are that, the accused approached the complainant and requested for personal loan. It is alleged that the complainant sanctioned and disbursed a loan of Rs. 35412/ to the complainant under the scheme of personal loan vide loan account no. S000012754. It is further alleged that the accused promised to make timely and regular payment of the scheduled EMI's but miserably failed to make the regular payment of EMI's in terms of the loan agreement.

3. It is further alleged that the accused in order to discharge his legal liability has issued a cheque bearing No.85472 dated 16.05.2012 amounting to Rs. 37,604/ drawn on State Bank of India in favour of the complainant. It is further alleged that the complainant on the basis of assurance and instructions of the accused presented the said cheque for encashment however the same was dishonored vide cheque returning memo dated 22.05.2012 with the remarks "Drawer's Signature Differs". The complainant thereafter has given a legal notice of demand dated 30.05.2012 to the accused which was sent to the accused through courier on 02.06.2012 thereby calling upon the accused to make the payment of the cheque amount within 15 days of the receipt of the legal demand notice. It is alleged that the accused has failed to pay any sum in response to the legal demand notice as a result of which the complainant has filed the present complaint for prosecution of the accused U/s 138 of the NI Act.


4. After complaint was filed, Sh Mahesh Kumar Authorized representative of the complainant (herein after said as AR) lead his pre summoning evidence by way of an affidavit and after hearing the Ld. Counsel for the complainant and considering the entire material and documents on record, summons were issued against the accused by the Court vide order dated 08.08.2012 for the offence U/s 138 of the NI Act. On appearance of the accused a separate notice U/s 251 Criminal Procedure Code (herein after said the Code) dated 21.06.2013 was given to the accused CC No. 4750/14 Indiabulls Vs. Sube Singh Page2 /11 to which he pleaded not guilty and claimed trial. Thereafter, an opportunity to file an application U/s 145 (2) of NI Act was given to the accused. Thereafter the accused moved an application U/s 145 (2) of NI Act and the same was allowed and the case was listed for cross examination of the complainant witnesses.

 COMPLAINANT'S EVIDENCE


COMPLAINANT'S EVIDENCE

5. Sh. Mahesh Kumar AR for the complainant got himself examined as CW1 and adopted his evidence affidavit Ex. CW1/J. CW1 also relied upon documents Ex. CW1/A to Ex. CW1/I. Ex. CW1/A is the copy of the amalgamation certificate of the complainant company, Ex. CW1/B is the copy of certificate of incorporation of the complainant company, Ex. CW1/C is the power of attorney in favour of the AR (CW1). Ex. CW1/D is the original cheque in question. Ex. CW1/E is the Cheque returning memo. Ex. CW1/F is the legal notice of demand dated 30.05.2012. Ex. CW1/G and Ex. CW1/H are the courier receipts along with the delivery report vide which the aforesaid demand notice was sent to the accused and Ex. CW1/I is the complaint under disposal.

6. CW1 also tendered statement of account of the accused as Ex. CW1/X and copy of the resolution in favour of Vipin Saroha as Ex. CW1/Y. CW1 (AR) was cross examined by the Ld. Counsel for the accused. Thereafter, the complainant's evidence was closed at request of the AR of the complainant.
 STATEMENT OF THE ACCUSED UNDER SECTION 313 OF THE CODE


7. After Complainant's evidence the statement of accused was recorded U/s 313 of the Code in which all the incriminating evidence along with exhibited documents were put to the accused Sube Singh. The accused admitted that he has taken loan from the complainant but further stated that he has repaid the entire loan to the complainant. The accused further submitted that the cheque in question does not bear his signature and the CC No. 4750/14 Indiabulls Vs. Sube Singh Page3 /11 particulars on the same have also not been filled by him. It was further submitted by the accused that the blank cheque in question was given by him to the complainant as a security at the time of taking loan from the complainant. The accused further denied the receipt of the legal demand notice. The accused further stated that the statement of account filed by the complainant is also false. The accused also stated that he has not issued the cheque in question in discharge of his liability. The accused further stated that he owes no liability towards the complainant as he has repaid the entire loan to the complainant. The accused further stated that the complainant has filed the false complaint case by misusing his security cheque. The accused all together denied all his liability.
 DEFENCE EVIDENCE

8. Thereafter, the case was fixed for defence evidence. An application U/s 315 of the Code was moved by the accused for examining himself as a defence witness. The said application was allowed and accused examined himself as DW1. DW1 was cross examined by the Ld. Counsel for the complainant and thereafter, defence evidence was closed at request of the accused and the case was fixed for final arguments.
 FINAL ARGUMENTS


9. Final arguments were addressed on behalf of both the parties. I have heard the Ld. Counsels for both the parties and have given my anxious and thoughtful consideration to submissions made, further I have perused the entire record of the case file and the evidence on record. Before proceeding further it is imperative for me to go through the relevant provisions of law "138. 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, of any debt CC No. 4750/14 Indiabulls Vs. Sube Singh Page4 /11 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:
 Provided that nothing contained in this section shall apply unless
 (a) the 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;
 (b) 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


(c) the drawer of such cheque fails to make the 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.


Explanation:For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability.

APPRECIATION OF EVIDENCE IN THE LIGHT OF INGREDIENTS OF THE OFFENCE U/S 138 OF THE NI ACT (I) ISSUANCE OF CHEQUE IN QUESTION, ITS PRESENTATION AND DISHONOUR


10. It is not disputed by the accused that the cheque in question Ex. CW1/D is drawn on the account maintained by him. Further signature on the cheque in question has also not been disputed by the accused. The accused has himself admitted to have signed and issued the cheque in question to the complainant while answering to the question at the time of framing of notice U/s 251 of the Code and also during his examination in chief as DW1 but it was also stated by the accused that he has given the blank signed cheque in question to the complainant at the time of taking of the loan. However the accused throughout the trial also stated that he has not filled all the particulars in the Cheque in question. During the course of CC No. 4750/14 Indiabulls Vs. Sube Singh Page5 /11 arguments Ld. Counsel for the accused also submitted that the complainant has taken security cheque from the accused at the time of granting loan and except signature other particulars in the cheque in question Ex.CW1/D has not been filled by the accused. It is trite to say that by putting the name and date there is no material alteration on the cheque U/s 87 of the NI Act. There is no rule of banking business that the name of the payee as well as the amount should be written by the drawer himself as no law provides that in case of cheque the entire body has to be written by the drawer only. Therefore, once the signature on the cheque in question is admitted as has happened in the instant case the plea that particulars in the cheque in question has not been filled by the drawer is of no consequence unless some cogent evidence has been lead by the accused that he has not expressly or impliedly authorized the payee to fill the particulars therein which is totally absenting in the instant case. Therefore, In light of the evidence on record and my discussion above, it stands proved that the cheque in question Ex


light of the evidence on record and my discussion above, it stands proved that the cheque in question Ex CW1/D bears the signature of the accused and the same has been issued by the accused from his own account.


11. Further record reveals that the cheque in question Ex. CW1/D dated 16.05.2012 was got dishonored vide cheque returning memo dated 22.05.2012 which is Ex. CW1/E. The presentation, dishonor of the cheque in question and the cheque returning memo has also not been challenged by the accused. Therefore, considering the entire evidence on record it stands duly proved that the cheque in question Ex. CW1/D was dishonored vide cheque returning memos Ex. CW1/E with the reason "Drawer Signature Differs".

(II) SERVICE OF THE LEGAL NOTICE OF DEMAND UPON ACCUSED


12. In the instant case, AR for the complainant (CW1) Sh .Mahesh Kumar, has specifically stated in his evidence affidavit that he has got issued the legal notice of demand dated 30.05.2012 which is Ex. CW1/F to the accused and it was sent to the accused on 02.06.2012 vide courier receipts of which are Ex. CW1/G and Ex. CW1/H. The courier tracking report is also CC No. 4750/14 Indiabulls Vs. Sube Singh Page6 /11 exhibited along with the courier receipts.


13. The accused at the time of framing notice under section 251 of the code stated that he has received one paper but he cannot say whether that was legal demand notice CW1/F. Further the accused during his statement under section 313 of the code and also during his evidence as DW1 has denied the receipt of legal demand notice CW1/F. Interestingly, the accused has himself admitted during his cross examination as DW1 that he resides at the D1/481, Sultanpuri, Near Geeta Senior Secondary School, Delhi 110041 which is one of the addresses mentioned in the legal demand notice and the complaint which establishes that the legal demand notice CW1/F was sent to the accused at the correct address. Moreover, the summons were served upon the accused at the aforesaid address and the accused has put his appearance in compliance thereof. Further it is well settled principle of law that where the accused raises a defence that he has not received the Legal demand notice, but has received copy of the complaint with the summons as has happened in the instant case, then he can within 15 days of the receipt of summons make payment of the cheque amount and he then cannot contend that there was no proper service of the legal demand notice (See C.C. Alavi Hazi Vs. Palapetty Mohd. & Anr. (2007) 6 Supreme Court case 555). Therefore. I hold that the legal notice of demand Ex. CW1/F was duly served upon the accused.


(III) ISSUANCE OF THE CHEQUE IN QUESTION IN DISCHARGE OF LEGAL DEBT OR LIABILITY.

14. The crux of penal liability under Section 138 of the NI Act is that the cheque must be issued by the drawer for the discharge of any legal debt or liability. Existing of legal debt or liability is sine qua non for constituting the offence.
15. Before I advert to the above said ingredients, it is imperative for me to notice the provisions of Sections 118(a) and 139 of the NI Act which read as under:
 "118. Presumptions as to negotiable instruments.--Un til the contrary is proved, the following presumptions CC No. 4750/14 Indiabulls Vs. Sube Singh Page7 /11 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, indorsed, negotiated or transferred, was accepted, indorsed, nego tiated or transferred for consideration;"

 "139. Presumption in favour of holder.--It shall be pre sumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.

16. The Division bench of Hon'ble Supreme Court in Krishna Ja nardhan Bhat v. Dattatraya G. Hegde, (2008) 4 SCC 54, has held that the accused can discharge the burden of presumption U/s 118 and U/s 139 of the NI Act by raising a probable defence on the strength of "preponder ance of probabilities".


17. In Rangappa Versus Sri Mohan AIR 2010 SC 1898 the Hon'ble Supreme Court has held that it is a settled position that when an accused has to rebut the presumption under Section 139 of the NI Act, the standard of proof for doing so is that of `preponderance of probabilities' and if the ac cused is able to raise a probable defence which creates doubts about the ex istence of a legally enforceable debt or liability the prosecution can fail and for this the accused can even rely on the materials submitted by the com plainant 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.


18. From the reading of the above said provisions and the judg ments the position of law which emerges is that once the execution of the promissory note is admitted as has happened in the instant case, the pre sumption under Section 118(a) and Section 139 of the NI Act would arise that it is supported by a consideration. Such a presumption is rebuttable. The accused can prove the nonexistence of a consideration by raising a probable defence. If the accused discharges the initial onus of proof show ing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the Complainant who will be obliged to prove it as a matter of fact and upon its failure to prove would CC No. 4750/14 Indiabulls Vs. Sube Singh Page8 /11 disentitle him to the grant of relief on the basis of the negotiable instru ment. The burden upon the accused of proving the nonexistence of the consideration can be either direct or by bringing on record the preponder ance of probabilities by reference to the circumstances upon which he re lies. In case, where the accused fails to discharge the initial onus of proof by showing the nonexistence of the consideration, the complainant would in variably be held entitled to the benefit of presumption arising under Section 118(a) and Section 139 of the NI Act in his favour.


19. Now coming to the case in hand, in the instant case the accused has examined himself as DW1 and has admitted that the cheque in question Ex. CW1/D bears his signatures. Further the accused has admitted that he has taken loan of Rs. 35,000/ from the Complainant in the year 2005. However with respect to the cheque in Question Ex. CW1/D the accused has stated that he has not issued the same in discharge of his liability and the same was given by him to the complainant as a security at the time of taking of the loan in the year 2005.


20. As per the statement of account Ex. CW1/X which is placed on record by CW1 it is also clear that the loan of Rs. 35412/ was granted by the complainant to the accused on 07.09.2005 and the same was to be repaid by the accused in 36 monthly installments of 1865/ each. Therefore it is evident that the entire loan amount was to be repaid by the accused till September 2008. Interestingly, perusal of statement of account Ex. CW1/X reveals that a payment of Rs. 1900/ has been received by the complainant from the accused on 11.09.2007 and thereafter no payment has been received by the complainant from the accused till 31.01.2011 when last payment of Rs. 4000/ is alleged to have been given by the accused on 31.01.2011. It is surprisingly to see that when loan was to be repaid by the accused till September 2008 the complainant chooses to remain silent for more than 2 years. It is highly improbable that a finance company would remain silent when no payment is being received by it from the borrower for more than 2 year after expiry of the loan tenure. Further the complainant has not even disclosed as to when the accused has approached them for the CC No. 4750/14 Indiabulls Vs. Sube Singh Page9 /11 purposes of handing over of the cheque in question Ex. CW1/D.


21. Further it is the case of the complainant that in discharge of his outstanding liability arising out of the agreement dated 07.09.2005 the accused agreed to pay a sum of Rs. 37,604/ vide cheque in question Ex. CW1/D bearing No.85472 dated 16.05.2012 i.e. six years after the agreement. This acknowledgment even as per the complaint was much after the statutory period of three years which is the prescribed period of limitation for the recovery of an outstanding amount. Furthermore an acknowledgment to be encompassed within the ambit of Section 18 and 19 of the Limitation Act has to be an acknowledgment in writing as well as within the prescribed period of limitation. It was thus not a valid acknowledgment as the Cheque in question Ex. CW1/D was clearly outside the period of limitation. The complainant has also not placed on record any document which states that there was an acknowledgment on the part of the accused well before the prescribed period. Therefore, the cheque cannot be even said to be issued in respect of legally recoverable debt

22. In Vijay Polymers Pvt. Ltd. & Anr 162 (2009) DLT 23 relying upon the judgment of Hon'ble Supreme Court in Sasseriyil Joseph vs. Devassia 2001 Crl.LJ 24 the Hon'ble Delhi High court had held that cheques issued on a time barred debt would not fall within the definition of 'legally enforceable debt' which is the essential requirement for a complaint under Section 138 of NI Act.

23. In the instant case, the cheque which is the subject matter of this complaint was for the discharge of a liability of a debt arising out of the agreement dated 07.09.2005 which debt had become time barred. Therefore this debt was not a legally enforceable debt within the meaning of Section 138 of the NI Act.


24. All the aforesaid circumstances/factors rebut the presumptions provided under Section 139 of the NI Act. This court do not find any force in the arguments advanced by the learned counsel for the Complainant that CC No. 4750/14 Indiabulls Vs. Sube Singh Page10 /11 the accused has failed to rebut the presumption under Section 139 of the NI Act. Presumption is not in itself evidence but it only enables a party in whose favour it exists to show that he has a prima facie case. In the case in hand the presumptions under Section 139 of NI Act alone cannot be the sole basis to prove the case of the complainant. The materials and evidence available on the record brought by the complainant do not bridge the gap. Therefore, I hereby hold that the Complainant has not been able to prove and substantiate the allegations that the cheque in question CW1/D was issued by the accused in discharge of legally recoverable debt or other liability.

25. Furthermore, mere non payment of cheque amount within 15 days of receipt of legal notice is not itself sufficient to fasten any liability U/s 138 of the NI Act as it is established that the cheque in question was not issued by the accused in discharge of a legal recoverable debt.

26. In view of the aforesaid discussion, I hereby hold that the complainant has not been able to prove and substantiate its allegation against the accused. Accordingly, accused Sube Singh S/o Sh. Fateh Singh is hereby acquitted for the offence u/s 138 NI Act.

This judgment contains 11 pages. Every Page of this judgment has been signed by me Announced in the open Court (RAVINDER SINGH II) Dated 27.05.2014 MM (NI Act 07) DWARKA/NEW DELHI.


CC No. 4750/14 Indiabulls Vs. Sube Singh Page11 /11


Mr. Prakash Chand Nimboria vs Unknown on 26 May, 2014

IN THE COURT OF SH. ASHOK KUMAR, MM07,
                        SOUTH EAST,  SAKET  COURTS, NEW DELHI

CC No. 349/2/14
U/S 138 NI Act

MR.  PRAKASH CHAND NIMBORIA
S/o Sh.  Hukam Chand,
R/o VPO Smalaka,
New Delhi.                    .......................Complainant
      Versus
MR.   RAHIMUDDIN
Proprietor of R.K. Meet Shop,
At RZ3/23, Shahnagar,
Manglapuri, Palam,
New Delhi110045.             .............................. Accused

Offence Complaint off or proved.                                  : Section 138 of Negotiable
                                                                    Instrument Act.
Plea of accused                                                   : Pleaded not guilty

Date of Institution                                             :  19.02.2003

Date of Reserving order                                        :  02.05.2014

Final order                                                    :  Convicted

Date of pronouncement                                          : 26.05.2014


JUDGMENT
FACTS OF THE CASE 1 The facts of the case as per the complaint and presummoning evidence of the complainant filed by way of affidavit which is also adopted as postsummoning CC No. 349/2/14 Page 1 of 15 evidence by the complainant are that the complainant and accused had friendly relations with each other since a long time. The accused took a friendly loan of Rs. 60000/ from the complainant in the year 2001 for which the accused issued three PDCs as mentioned herein below. Thereafter, the complainant presented the cheques for encashment which became dishonoured on account of "insufficient funds". On the said intimation on returning memo dated 11.01.2003, the complainant served a legal notice dated 18.01.2003 to the accused. TRIAL PROCEEDINGS 2 Thereafter, the complainant filed the complaint under Sec. 138 NI Act after the accused failed to make the payment within 15 days of the receipt of legal notice. On the said facts, the accused was summoned and notice under Sec. 138 NI Act was framed against the accused to which he pleaded not guilty and claimed trial. The complainant adopted the presummoning evidence in his post summoning evidence also. Thereafter complainant was cross examined. Thereafter, statement of accused under Sec. 313 CrPC was recorded and the accused thereafter examined his father Sh. Khacheru Khan as DW1 and his father's friend as DW2 as defence witnesses. The following documents were relied by the complainant in his evidence :


Complainant proved the following documents in his presummoning evidence : i Cheuqes with bank endorsement Ex. CW1/A, CW1/B and CW1/C.


ii      Bank returning memos Ex. CW1/D, CW1/E and CW1/F.

CC No. 349/2/14                                                                                Page 2 of 15
             ii      Legal notice dated 18.01.2003 Ex. CW1/G.

            iv      Registered AD and UPC Ex. CW1/H and CW1/I.

 Accused proved the following document in his defence evidence : i Copy of account statement of DW1 Khacheru Khan mark A. 3 The complainant was duly crossexamined by the counsel for the accused and thereafter the accused was examined under Sec. 313 CrPC. All the evidence appearing against the accused was put to him. The explanation of the accused was that he had asked for the loan from the complainant and on demand of the complainant he gave the advance cheque without taking the loan because the complainant represented that he would extend the loan to the accused in a few days. However, after some days the complainant did a U turn and refused to extend the loan because he had a dispute with father of the accused to whom the complainant had advanced the loan but even after he father returned the loan amount complainant was demanding more money from him. Hence, here the accused admits that three cheques in question were executed by him. Thereafter, the accused led the defence evidence and examined his father Khacheru Khan as DW1 and also examined one Sh. Kishan Lal his father's friend as DW2 who were crossexamined by the complainant.
4 RELEVANT LAW


138. Dishonour of 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, of any debt or other liability, is CC No. 349/2/14 Page 3 of 15 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 provision of this Act, be punished with imprisonment for [ a terms which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both :
 Provided that nothing contained in this section shall apply unless

 (a) the 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;
 (b) 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.


(c) the drawer of such cheque fails to make the 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. Explanation - For the purposes of this section, " debt or other liability" means a legally enforceable debt or other liability.

 139. 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 nature CC No. 349/2/14 Page 4 of 15 referred to in section 138, for the discharge, in whole or in part, of any debt or other liability.

 Sec. 43 of NI Act interalia provides that a negotiable instrument drawn, accepted, etc. without consideration or for a consideration which fails creates no obligation of payment between the parties to the transaction.

 The ingredients to prove the commission of offence under Sec. 138 NI Act have been laid down in Jugesh Sehgal Vs. Shamsher Singh Gogi 2009 (9) SCALE 455. The relevant portion of the said judgment reads as under:

 "9. It is manifest that to constitute an offence under Section 138 of the 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;
 (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;
CC No. 349/2/14 Page 5 of 15
 (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 15 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 ofar the said notice"
 On burden of proof in cases under NI Act From reading of below quoted paragraphs No. 4 to 9 and 20 of Hon'ble Supreme Court in Vijay Vs Laxman 2013 (1) RCR Cr 1028, the following legal ratio emerges with regard to burden of proof in matters under NI Act.


i. The prosecution has to prove beyond reasonable doubt that cheque was issued by the accused duly signed by him but this burden is lightened by presumption under Sec. 118 and 139 NI Act. Hence, the complainant has only to make an averment that cheque was issued by accused to complainant for lawful consideration.

 ii. Thereafter, the burden shifts on the accused to show that the cheque was not issued in lieu of legally enforceable debt or liability but was issued by way of security or any other reason on account of some business transaction or was obtained unlawfully.
 iii. However, accused can rebut this presumption or discharge his burden by showing a probable defence or preponderance of probability raising genuine doubt CC No. 349/2/14 Page 6 of 15 that no legally enforceable debt or liability exists.

 iv. Accused can discharge this burden either from circumstances appearing in the case or the evidence adduced by the complainant or accused in his defence.

 v. On reading of definition of word proved or disproved in Sec. 3 of Evidence Act with Sec. 139 NI Act court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the nonexistence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that the consideration does not exist.

 Above said law is quoted in paragraphs No. 4 to 9 and 20 of Hon'ble Supreme Court in Vijay Vs Laxman and another 2013 (1) RCR Cr 1028.


Above said observations were also made by Hon'ble Supreme Court in Kamala S Vs Vidhyadharan MJ 2007 (3) RCR (Cr) 865 and M/s. Kumar Exports Vs M/s Sharma Carpets 2008 (16) SCALE 372 Paras 9 to 12.


On service of legal notice in cases under NI Act In this respect it has been provided in the case titled as C.C. Alavi Haji Vs Palapetty Muhammed and Anothers (2007) 6 SCC 555 that the entire purpose of service of legal notice to the accused under Sec. 138 NI Act is to give an opportunity to the drawer to pay the cheque amount within 15 days of the service of legal notice and thereby free himself from the penal consequences. It conceives cases where a wellintentioned drawer may not have made necessary arrangements for reasons beyond his control to honour the cheque drawn by him and hence this CC No. 349/2/14 Page 7 of 15 opportunity has been provided. Hence, this provision is meant to protect honest drawers whose cheque may have been dishonoured for the fault of others or who may have genuinely wanted to fulfill their promise but on account of inadvertence or negligence failed to make necessary arrangements for the payment of the cheque. Hence, any honest 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 Sec. 138 NI Act, make payment of the cheuqe amount and submit to the court that he has made payment within 15 days of receipt of summons (by receiving a copy of the plaint with the summons) and, therefore, the complaint is liable to be rejected. Where a legal notice is sent under registered cover with proper address and stamp and sent along with the summons and complaint, then if it is contended that legal notice was not received only with a view to cheat the complainant, and such offer of payment was not made within 15 days of receipt of summons, then such dishonest drawer can not contend improper service of the notice by virtue of applicability of presumption under Sec.


dishonest drawer can not contend improper service of the notice by virtue of applicability of presumption under Sec. 27 GC Act and 114 Evidence Act.


Hence, the accused by a preponderance of probability has to prove the following :
 1 That the cheque was issued as security or for any business transaction and there is no legally enforceable debt or liability because the said security is no more enforceable or the debt or liability has been paid.


2 That the cheque was taken unlawfully and wrongfully. 3 That the debt or liability does not remain legally enforceable due to CC No. 349/2/14 Page 8 of 15 any other reason.


In the present case defence of the accused is that there is no legally enforceable debt against the cheques given by the accused to the complainant no loan was extended as per their implied contract.
5 ARGUMENTS HEARD AND DEALT WITH I have heard the submissions of both the Ld. Counsel for the complainant as well as the accused. Ld. Counsel for the accused has also filed written submissions and the same have also been considered besides the said submissions and the record.


6 Let us now examine whether the complainant has proved the necessary ingredients of the offence under Section 138 of the Act or not. 6.1 The first ingredient of the offence stands proved as original cheques are placed on record as Ex. CW1/A, CW1/B and CW1/C and issuance of same is admitted by the accused. The accused during the cross examination of the complainant, his own explanation u/s 313 Cr.P.C and defence evidence led by him proceeds on the ground that he has signed the cheques and it is settled law that a signed cheque by the account holder is a complete instrument and the rest of the portions of the cheque can be filled by the complainant. Only defence of the accused is that though he gave cheques in question to the complainant but in return loan was not extended by the complainant and hence he does not owe any liability. Hence it is clear that that the accused has signed the cheque in question. 6.2 The second ingredient of the offence is that the cheque must have been issued in discharge of legal liability. As the signatures on the cheques are admitted, CC No. 349/2/14 Page 9 of 15 the presumptions raised under Section 139 of the Act become applicable and the issuance of cheque in discharge of the legal liability stands proved. The law on this point has been succinctly laid down by the Hon'ble Apex Court in Rangappa v. Sri Mohan AIR 2010 SC 1898.


In view of the aforesaid law, the presumption under Sec. 139 NI Act works in favour of the complainant once he files the necessary documents like the dishonored cheques, returning memo, legal notice and delivery proof and avers that the cheques were issued for legally enforceable debt or liability which the accused has failed to pay despite expiry of 15 days of the delivery of legal notice. In the present case the only defence raised by the Ld. Defence Counsel is that the father of the accused and the complainant were working in the same organization namely CPWD and they know each other for about 30 years. Infact father of the accused namely DW1 Khacheru Khan had taken the money in the amount of Rs. 60000/ for which DW1 has already repaid in the amount of Rs. 70000/ but the complainant was demanding Rs. 80000/. The said DW1 has also filed copy of the account statement Mark A showing that said amount has been returned on 14.01.2002 but despite that the case has been filed against the accused who had given the advance cheque but due to the dispute with father of accused loan was not granted to the accused. Hence, the said cheques being without consideration the defence of the accused is not liable to be upheld on this ground. Even otherwise the said statement is only a copy and it has not been duly certified by the bank as per law and hence, same also has not been exhibited. In view of the said reasons the said account statement cannot be considered. The accused has not CC No. 349/2/14 Page 10 of 15 been able to bring any other documentary evidence in support in his defence evidence to show that he has not taken the loan from the complainant. Further in the cross examination of the complainant the accused could


taken the loan from the complainant. Further in the cross examination of the complainant the accused could not bring any contradiction which may dislodge the presumption in favour of the complainant which is raised u/s 139 of N.I. Act that the cheque was issued by the accused for a legal consideration. The complainant consistently denies the suggestion; that there was no legal consideration; that no legal notice was served; that he took the cheques in question in advance and misused them; that Khacheru Khan has returned the amount of Rs. 70000/ for cheques in question; that there was dispute with DW1 regarding the loan given to him; that at the time of giving loan to the accused DW1 or DW2 were present there or that the complainant misused those cheques in any manner. Further, as per the account statement mark A the loan was returned in 14.01.2002 but it is very strange as to why the complainant would write the date of September, 2002, November, 2002 and December, 2002 on those cheques if the accused had given these cheques as advance during the time when the complainant had a dispute with DW1. This is against the natural course of conduct. It is also pertinent to note that DW2 friend of DW1 says that the loan was given to the accused at complainant shop at Kapsehra in his examination in chief but in cross examination he denies that the complainant has a shop at that place. The case of the accused proceeds on the basis that the loan was given at the shop of the complainant. Hence on one hand the accused has not been able to show that he did not take any loan from the complainant or that he repaid the amount and on the other hand the presumption in favour of the complainant that <span class="hidden_text" id="span_11">CC No. 349/2/14 Page


id="span_11">CC No. 349/2/14 Page 11 of 15</span> the cheques were issued by the accused to him for a legal consideration stands unrebutted. Hence, I give the finding in favour of the complainant that he received the cheques from the accused for a valid consideration. 6.3 The third ingredient of the offence is that cheque must be presented to the bank within a period of six months from the date mentioned on it. The cheques are Ex. CW1/A, CW1/B and CW1/C were returned back unpaid on 11.01.2003 and the cheques are dated 5.9.2002, 5.11.2002 and 5.12.2002. So it is evident that it was presented for payment within the statutory period of six months. 6.4 The fourth ingredient of the offence is that the cheque(s) must be returned unpaid. The cheque were returned unpaid for the reason "Insufficient funds". The original bank returnmemos Ex CW1/D to Ex. CW1/E placed on record proves dishonour of cheques by virtue of presumption raised under Section 146 of the Act and during the trial, Ex. CW1/D to CW1/E went uncontroverted. 6.5 The fifth ingredient of the offence is that the demand notice must be issued to the accused within 30 days of the intimation of dishonour of cheque and same be served upon the accused. Accused has denied the receipt of legal notice Ex. CW1/G. The address mentioned in the pre & post summoning affidavit (both are same) and in the complaint on the basis of which summons were issued to the accused and he had appeared is not disputed by the accused. In view of Judgment of CC. Alavi Haji (Supra) this point can not be raised any more by the accused. If the accused


(Supra) this point can not be raised any more by the accused. If the accused had not received the legal notice, then he could have offered the payment within 15 days from the receipt of the summons in view of my aforesaid findings in the second ingredient that cheque was issued in discharge of legal CC No. 349/2/14 Page 12 of 15 liability.


6.6 The last ingredient is that the accused must not have made the payment of the cheque amount within fifteen days of the receipt of legal notice. During the evidence, the accused has clearly admitted that because he does not owe anything to the complainant hence he did not make the payment of cheque amount. DECISION
7. In view of the aforesaid the accused is convicted for the offence under Sec. 138 NI Act and he be separately heard on the point of sentence.


Announced in the open                                                (ASHOK KUMAR)
Court on 26.05.2014                                             MM07,  SOUTH EAST, SAKET
                                                                   COURTS, NEW DELHI

CC No. 349/2/14                                                                                Page 13 of 15
                      IN THE COURT OF SH. ASHOK KUMAR, MM07,
                       SOUTH EAST,  SAKET  COURTS, NEW DELHI

Prakash Chand Nimboria Vs. Rahimuddin.
CC No. 349/2/14
U/s  138 NI Act

26.05.2014

ORDER ON POINT OF SENTENCE

Present :        Complainant  in person with Counsel Sh. D.K. Agarwal.

 Accused in person with proxy counsel Ms. Rita Satija.
 Vide separate judgement, the accused is convicted for commission of offence under Sec. 138 NI Act for nonpayment of three cheques amounting to Rs. 60000/ in total vide separate judgement of even date.

 It is stated by the convict that he is managing a Dhaba which is owned by the joint family. The convict has a family consisting of 6 children, all unmarried and minor. It is stated that a lenient view may be taken against the convict while imposing the sentence and convict be not sentenced to imprisonment.


In view of the fact that the matter is pending since year 2003 and is more than 10 years old and keeping in view the fact that the cases under Sec. 138 NI Act are unduly clogging the dockets of the courts leading to docket explosion and extraction of judicial time which could have been given to other cases and on the other hand due to the dishonest issuance of cheque, the same is eroding of credibility of such instruments, this court does not deem it necessary to extend the CC No. 349/2/14 Page 14 of 15 benefit of Probation of Offender Act to the accused. Such dishonest conduct leads not only to docket explosion which needs to be tackled with a heavy hand but also has resulted in harassment of the complainant holding up the valuable money belonging to him.
 In view of the aforesaid, the convict is directed to suffer simple imprisonment of 2 years and fine of Rs. 1.20 lakhs all of which is directed to be paid as compensation to the complainant and in absence of payment of the same, the convict shall suffer simple imprisonment for 6 months. Copy of judgement and order on sentence be given to the convict.

Announced in the open                                                (ASHOK KUMAR)
Court on 26.05.2014                                             MM07,  SOUTH EAST, SAKET
                                                                   COURTS, NEW DELHI

CC No. 349/2/14                                                                                Page 15 of 15


IN THE COURT OF SHRI SATVIR SINGH LAMBA, MM-01
               ( NEGOTIABLE INSTRUMENTS ACT) WEST DISTRICT,
                         TIS HAZARI COURTS, DELHI

Shri Rajan Gohar
S/o Late Sh. Bahdra,
R/o H.No. 258,
NDPL Colony, Shalimar Bagh,
New Delhi-110059.                                              ......Complainant

                                            Vs.

Shri Jitender Kumar
R/o 227, Street No.1,
Than Singh Nagar,
Anand Parbat,
New Delhi.                                                     ........Accused

                                         JUDGMENT
Complainant Case No.                 :            474/1
Date of institution                  :            28.07.2006
Offence alleged                      :            Under Section 138 NI Act
Plea of the accused                  :            Not pleaded guilty
Final order                          :            Conviction
Date of Decision                     :            26.05.2014

                                         Brief Facts


Brief Facts

1. Brief facts of the present case are that the complainant and accused were having friendly relations with each other from last many years. It is alleged that the accused approached the complainant for a friendly loan of Rs.30,000/- and considering the need of accused as well as their friendly relations, the complainant advanced friendly loan of Rs.30,000/- to the accused. It is further alleged that in order to discharge his liability, accused issued two post dated cheques to the complainant bearing cheque bearing no.386258 dated 12.01.2006 for Rs.25,000/- i.e. Ex.CW1/1 and cheque bearing no.386251 dated 16.05.2006 for Rs.5,000/- i.e Ex.CW1/2 both drawn on State Bank of India, Tis Hazari Courts, Delhi in favour of complainant. The complainant presented the cheques in question for encashment through his banker National Bank Ltd, Shalimar Bagh, Delhi but the same were got dishonored by the banker with the remarks "Funds Insufficient" vide returning memos dated 17.05.2006, which are Ex.CW1/3 and Ex.CW1/3A. Henceforth, the complainant issued the mandatory legal notice U/s 138 NI Act dated 01.06.2006 i.e. Ex.CW1/4 and the same was served upon the accused vide postal receipts, AD card and UPC. The same are Ex.CW1/5 to Ex.CW1/7.


2. When the accused failed to fulfill the conditions of the said legal notice Ex.CW1/4 within 15 days of its presumed service, then the complainant has filed the present complaint case U/s 138 of Negotiable Instrument Act 1881 (hereinafter the Act) against the accused.

 Pre-Trial Procedure

3. After the institution of the present complaint, the complainant adduced his pre summoning evidence U/s 200 Cr. P.C. on which basis the accused was summoned via order dated 27.05.2008 to face trial for the offence U/s 138 NI Act. After the service of the summons, the accused entered his appearance whereupon the provisions of Sec. 207 Cr. P.C. were also complied.

4. The accused was admitted to bail then notice U/s 251 Cr. P.C. for the offence U/s 138 NI Act was served upon the accused on 25.09.2010 after hearing the contesting parties. Needless to say, the accused pleaded "Not Guilty" and claimed trial.

 Trial

5. In order to substantiate his case, the complainant lead his evidence by way of his affidavit whose contents are a mere repetition of what had already been discussed under the "Brief Facts" and hence are not repeated for the sake of brevity. However, the accused failed to disclose any reasonable grounds for the cross examination of the complainant despite opportunities, hence, the opportunity of accused was closed vide order dated 09.11.2010.


6. All the incriminating circumstances, appearing in the evidence against the accused were put in order to unable him to offer his explanation. In his explanation, the accused has not disclosed his plea of defence, however, admitted the issuance of the cheques in question as well as his signatures on the cheques in question. Accused also admitted the receiving of the legal notice and same was duly replied by him.

7. In support of his defence, accused examined four witnesses namely Sh. Vidya Bhushan, his wife Mrs. Renuka, ASI Vinay Paul, P.S. Shalimar Bagh and himself as defence witnesses. The above said defence witnesses were duly cross examined by the complainant. Thereafter, DE was closed vide order dated 20.04.2013 whereupon the trial came to a conclusion and the contesting parties were duly heard.

 Facts in Issue

8. In order to have the positive outcome in his favour, the complainant was required to show that the cheques Ex.CW1/1 and Ex.CW1/2 were given by the accused to discharge his liabilities which were dishonoured via returning memo's whereafter the accused had also failed to comply with the requirements of the legal notice Ex.CW1/4.

9. On the other hand, the accused was required to show his defence on the scale of preponderance of the probabilities that he is not liable to the amount involved to the complainant.

 Legal Prepositions

10. The presumptions provided U/s 118 NI Act and 139 NI Act would come to the rescue of the complainant once the execution of the cheque in question is proved on record.


11. As per section 118 NI Act, it is to be presumed in favour of the complainant during the trial that the cheque in question was given against consideration by the accused and that the complainant was the holder of the said cheque in due course. Further as per Sec. 139 NI Act, it is to be presumed in favour of the complainant during the trial that the cheque in question was received by the complainant against a legally enforceable debt or liability (Refer :- "Rangappa Vs. Sri Mohan" SLP (Crl.) 407/06, Dated:- 07.05.2010).

12. It is well settled that both the aforesaid presumptions U/s 118 & 139 NI Act are rebuttable in nature and the onus to rebut the same squarely rests upon the accused.


13. The accused can rebut these presumptions not merely by examining his own witnesses but also through the cross examination of the complainant and his witnesses thereby bringing on record through the entire evidence available on record (inclusive of complainant's evidence and defence evidence, if any), that the complainant was a liar, that their was no existing liabilities between the parties and that the cheque in question was misused. It must be kept in mind that once evidence is brought on record from both sides, it becomes an evidence of the case and court can draw inferences from the said entire evidence either in favour or against any of the parties. Evidence is a complainant's evidence and accused's evidence only for the purposes of identifying it, but once it is adduced in the case, it becomes the evidence of the case and then the same has to be read as a whole. The court can not read the evidence of the complainant only to the extent it favours the complainant and overlook the remaining evidence which supports the accused merely on the ground that it is the complainant's evidence. Similarly, from the evidence adduced by the accused, the court can draw inferences either in favour of the complainant or against the accused. The accused has a right to argue his case even on the basis of the cross examination of the complainant & his witnesses to show to the court that there existed no legally recoverable debt or liability between the parties. In order to rebut the legal presumption in question, it emerges that the accused need not require direct evidence to disprove the existence of consideration.


14. Preponderance of probabilities is the standard of proof upon the accused to rebut the above presumptions, which is not as high as that of the prosecution whereby the accused is only required to show the existence of a probable defence so as to rebut the above presumptions. If the accused succeeds in raising a probable defence by referring to his own evidence (if any) and from the evidence of the complainant, then the onus would shift on to the complainant, who then would have to show beyond reasonable doubt the existence of consideration/existence of a legally recoverable debt or liability in respect of the cheque in question.

 Appreciation of Evidence

15. The present case is proceeded on case law i.e. Rajesh Aggarwal vs. State & Anr. - MANU/DE/1838/2010, vide which it is held by hon'ble High Court of Delhi that "17. The summary trial procedure to be followed for offences under Section 138 N.I. Act would thus be as under:
 Step I: On the day complaint is presented, if the complaint is accompanied by affidavit of complainant, the concerned MM shall scrutinize the complaint & documents and if commission of offence is made out, take cognizance & direct issuance of summons of accused, against whom case is made out. Step II: If the accused appears, the MM shall ask him to furnish bail bond to ensure his appearance during trial and ask him to take notice under section 251 Cr.P.C. and enter his plea of defence and fix the case for defence evidence, unless an application is made by an accused under section 145(2) of N.I. Act for recalling a witness for cross-examination on plea of defence.


Step III: If there is an application under Section 145(2) of N.I. Act for recalling a witness of complainant, the court shall decide the same, otherwise, it shall proceed to take defence evidence on record and allow cross-examination of defence witnesses by complainant.

 Step IV: To hear arguments of both sides.

 Step V: To pass order/judgment."

16. Hon'ble Delhi High Court in the above mentioned case emphasized that once the complainant has brought forward his case by giving his affidavit about the issuance of the cheque, dishonour of cheque, issuance of demand notice etc. he can be cross-examined only if the accused makes an application to the court as to on what point he wants to cross-examine the witnesses and then only the court shall recall the witness by recording reasons there to.

17. In a summary trial, the complainant or his witness cannot be recalled in the court for cross-examination only for the sake of pleasure. In the present complaint case after recording the plea of defence at the time of framing notice, opportunity was given to the accused for disclosing the grounds to cross examine the complainant. However, the accused has not disclosed any reasonable ground for recalling the complainant for cross-examination on his plea of defence. Therefore, there was no reason to recall the complainant or witnesses during summary trial and the evidence already given by the complainant has to be considered sufficient and his opportunity to cross examine the complainant closed vide order dated 09.11.2010. The above said order also attains finality. Thereafter, reasonable opportunities were given to the accused to lead his evidence in defence on the plea of innocence as the evidence of the complainant is already on record.


18. In order to prove his innocence, accused examined Sh. Vidya Bhushan, Advocate, Tis Hazari as DW1. DW1 stated that after completing his daily work on 26.05.2006, when he went to his seat Sh. Arvind Dua, Advocate alongwith his another friends were sitting there. DW1 stated that at about 12:00 Noon the said Arvind Dua received a telephone call from the accused informing that the accused was detained by someone near Juvenile Court Complex, Mukherjee Nagar, Delhi. Thereupon, DW1 and the said Arvind Dua reached there separately by their motorcycles. On asking, the accused told that accused and his associates had misbehaved / man handled with him. Thereafter, they reached at Mukherjee Nagar by their respective vehicles. DW1 stated that he reached the police station 10 minutes later than the accused and saw the accused, the complainant with his associates and the said Rajan were talking to each other in the presence of police officials. DW1 stated that he stayed there for 5 minutes. DW1 further stated that the complainant and accused were amicably settled the matter for payments/repayments of Rs. 1,30,000/- and gold, thereafter, he came back to Tis Hazari Courts and other persons were remained in the said police station.


19. In his cross examination, DW1 admitted that he had neither received any telephone calls from the accused nor had heard any conversation between the said Arvind Dua and the accused. DW1 further admitted that neither of them had made any written complaint to any lawful authority / bar association regarding the detention of the accused. DW1 further admitted that neither he had seen the accused in detention of any person nor misbehaved/man handled by any person. DW1 further admitted that he had not signed on the alleged settlement between the complainant and the accused in PS Mukherjee Nagar, Delhi. DW1 further admitted that no settlement was arrived between the complainant and accused in his presence and denied of knowledge by whom the alleged settlement was sent. However, all the suggestions put to him were denied.

20. Accused examined his wife Mrs. Renuka as DW2. DW2 stated in his examination in chief that she and her husband had borrowed a sum of Rs.1,30,000/- from the complainant in the month of December 2005 against the pledge of gold ornaments of weighing about 20 tolas. DW2 stated that they had returned a sum of Rs.1.0 lakh on 18.05.2006 but the complainant had refused to return the said gold ornaments. In her cross examination, DW2 admitted that no written document was prepared regarding the pledge of gold ornaments. DW2 admitted that she has not brought any bill/ receipt showing that the above said ornaments were belonging to them. DW2 further admitted that she has never raised any demand regarding the return of the above said gold ornaments. However, all the suggestions put to her were denied.


21. Accused examined ASI Vinay Paul, P.S. Shalimar Bagh as DW3 who has brought the summoned record i.e daily register dated 26.05.2006 and same is Ex.DW3/A(OSR). Cross examination of the DW3 was Nil (opportunity given).


22. Lastly accused examined himself as defence witness and stated in his chief examination that he had borrowed a sum of Rs.1,30,000/- against pledging of gold ornaments of his wife weighting around 200 grams. Accused further stated that on 18.05.2006, he had returned a sum of Rs.1.0 lakh to the complainant but the complainant refused to return his above said gold ornaments and asked remaining amount of Rs.30,000/- upon which he issued the cheques in question. Accused further stated that after taking the cheques in question the complainant refused to return the pledged gold ornaments. Accused further stated that on 26.05.2006, the complainant alongwith his brother Bittoo and three associate persons met him at Mukherjee Nagar and confine him for more then half hour upon which the police arrived and took them to the police station Mukherjee Nagar, Delhi where the complainant requested that they will amicably settle the dispute before the police officials of PS Shalimar Bagh. Accused further stated that when he went to PS Shalimar Bagh in the evening the complainant did not turn up there, thereafter, he made a written complaint Ex.DW3/A(colly 1-3 pages) in the said police station against the complainant. Accused further stated that the complainant came there and demanded Rs.1,30,000/- for returning the gold ornaments again in the PS Shalimar Bagh. Accused further stated that considering the attitude and conduct of the complainant, he had filed complaint against the complainant u/s 406/420 IPC in Rohini Courts. The certified copies of the complaint is EX.DW3/B(Colly 1-7 pages). The reply to the legal notice sent by the complainant is Ex.DW3/C (colly 1-4 pages). Ex.DW3/B


is Ex.DW3/C (colly 1-4 pages). Ex.DW3/B (colly 1-3 pages) is the written complaint given to the PS Tis Hazari regarding the theft by complainant and his brother for Rs.30,000/- from the drawer of the accused.


23. In his cross examination, the accused admitted that he is an advocate by profession and some other cases are also pending against him regarding the dishonor of the cheques filed by different persons. Accused admitted that he had not obtained any written document/receipt from the complainant regarding the above said pledge of the gold ornaments with the complainant. DW4 further admitted that he had not obtained any receipts from the complainant regarding the payment of Rs.1.0 lakh to him. Accused further admitted that he could not produce any document regarding the alleged PCR call or taking of them to police station Mukherjee Nagar, Delhi by the concerned police officials. Accused admitted that he had not filed any civil suit regarding the above said pledged gold ornaments despite aware of legal remedies. However, all the suggestions put to him were denied.

24. It is argued by the Ld. counsel for complainant that from evidence on record, the complainant has proved that cheques in question were signed by the accused which were dishonoured vide bank memos and despite the legal notice accused did not make the payment. It is argued that the accused failed to cross examine the complainant, hence, nothing material has come out and the complainant has been able to prove his case. It is further argued that accused has failed to discharge the burden upon him to rebutt the presumption in favour of the complainant under the Act.


25. Now the question is whether the complainant proved his case, that whether the amount was legally enforceable debt. Offence under Section 138 of the Act is a technical offence and the complainant is only supposed to prove that the cheques issued by the accused were dishonoured, his statement that cheques were issued against liability or debt is sufficient proof of the debt or liability and the onus shifts to the accused to show the circumstances under which the cheques were issued and this could be proved by the accused only by way of cogent evidence.

26. Ld. Counsel for accused argued that the present case is false and frivolous and had concealed material facts from the court. Ld. Counsel for accused argued that accused had availed a sum of Rs,.1,30,000/- instead of Rs.30,000/- from the complainant upon the pledging of gold ornaments of his wife weighing around 20 tolas. Ld. Counsel for accused further argued that despite receiving of the substantial amount of the said loan, the complainant has not returned the gold ornaments of accused. It is further argued that the complainant is misusing the cheques in question with intention to harass the accused and by grabbing the gold ornaments of his wife.


27. 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/evidence on preponderance of probabilities to prove that cheques in question were not supported by consideration and that there was no debt or liability to be discharged by him. However, there is no need 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. At the same time it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the complainant.

28. From the material on record, it is established that the complainant and accused were known to each other and were having friendly relations among themselves. The issuance of the cheques in question is not disputed by the accused. It is further established on record that the cheques in question issued by the accused got dishonored vide bank memo. The signatures on the cheques in question are not disputed by the accused at all. It is also established on record that the cheques in question pertains to the account of the accused. The legal notice sent by the complainant was received by the accused and same was duly replied by him.


29. The testimony of DW2 reveals that she and her husband had availed a sum of Rs.1,30,000/- from the accused in December 2005, however, the accused stated in his examination in chief that he availed the said loan amount by way of four installments from the period during December 2005 to March 2006. The alleged averments are inconsistent and contrary to each other. Further the alleged loan was obtained from the complainant against the pledging of the gold ornaments of wife of accused with the complainant. Interestingly, the wife of the accused was not aware of the date of borrowing money, the date of pledging of the said gold ornaments. Moreover, the accused has failed to produce on record any bill / receipt showing that the above said gold ornaments were belonging to them. Further the accused has not furnished on record any document/ proof regarding the payment of Rs.1.0 lakh on 18.05.2006 to the complainant. It is particular to mention here that DW2 who has never raised any demand to the complainant regarding the return of the said gold ornaments. The accused has admitted that he has not filed any civil suit regarding the recovery of the above said gold ornaments. It is explained by the accused and his wife that the above said gold ornaments was her stridhan, however, the accused and his wife has failed to produce any document which shows that the alleged gold ornaments were of 20 tolas or they have ever purchased the alleged gold ornaments nor has brought any photographs which shows that the above said gold ornaments were given to her in her marriage.


30. The plea of defence raised by the accused that the complainant had stolen a sum of Rs.30,000/- from his drawer or that the complainant is demanding a sum of Rs.1,60,000/- for the amicable settlement are neither relevant nor related regarding the rebuttal of the presumptions in favour of the complainant regarding the cheques in question. The alleged averments does not bear any relevancy in proving the innocence of the accused towards the dishonoring of the cheques in question. The testimony of the DW1 regarding the alleged amicable settlement in the police station Mukherjee Nagar is not believable because no written compromise/agreement as alleged by the accused was furnished on record during the trial of the present case. Further the DW1 has admitted that no amicable talks took place between the complainant and accused in his presence. Moreso, DW1 has admitted that neither he has signed any agreement regarding the compromise between complainant and accused nor knows by whom the alleged agreement/compromise was signed.


31. The plea and the defence taken up by the accused that the cheques in question had been given by him to the complainant for the returning of the alleged gold ornaments is of no consequence. The accused has admitted the signatures on the cheques in question. On the one hand, the accused is admitting that his liability towards the accused was of Rs.1,30,000/- out of which he has already repaid the amount of Rs.1.0 lakh. It is pertinent to mention here that the accused has not produced any iota of evidence regarding the alleged repayment to the complainant. Considering the plea of defence of the accused, it can be inferred that he is admitting the liability of Rs.30,000/- and same was never repaid to the complainant at any point of time. Once he has admitted his signatures on the cheques in question he cannot escaped from his liability on the ground that same has been issued only for the returning of the alleged gold ornaments. When a cheque is signed and handed over it means that the person signing it, has given implied authority to the holder of the cheque for its encashment towards the liability. This shows that cheques had been issued to discharge the alleged liability. It is pertinent to mention here that the cheques in question were dishonored due to funds insufficient instead of any other reason if the accused was of apprehension that the complainant might misuse the cheques he might have intimated his banker for stop payments to avoid the misuse of the cheques but it was not the case in present facts and circumstances.


32. Therefore, mere pleading not guilty would not amount to rebutting the presumption raised under Section 139 of N.I Act. In the present case accused has not produced any cogent proof in support of his innocence which makes it improbable that the cheques in question were not issued towards the discharge of legal liability as alleged by the complainant but at the same time strengthens the foundation fabrics of the present complaint case. In the present case, the accused failed to raise a cogent suspicious circumstances in the version of the complainant which belies the foundation of the present complaint case. Further, nothing has been proved by the accused to show that the cheques in question were misused by the complainant and that he did not have the legally enforceable liability towards the complainant.

 Conclusion

33. Having considered the testimonies the issuance of cheque was not in dispute which were dishonored by bank returning memo. Accused is served with legal notice through registered post within the stipulated period and despite that no payment has been made by him.

34. Reading of the evidence on record in its entirety, would show that the evidence is not supportive with the innocence of the accused and as such same is li- able to be dismissed out rightly. Secondly, accused has not produced any cogent proof in support of his defence on record. This court is of the opinion that the defence set up is neither definitive nor consistent with innocence of the accused. It is liability of the accused to bring positive evidence, in the wake of denying the liability by bringing evidence showing that accused has no liability towards complainant in the present complaint. It was sole burden and duty of the accused to prove no liability by raising probable defence when he was defending presumption, which was supporting the dis- honoured cheque. The accused has failed to discharge the onus.


35. For rebutting the presumptions under the 'Act', a just need is to raise a probable defence. However, in the present case accused not only failed to show pre- ponderance of probability in his favour but also not succeeded in discharging his ini- tial burden for rebutting the presumption under the NI Act by not leading any cogent evidence in his support. Thus, this court unhesitatingly holds that the accused has not been able to rebut the presumptions under section 139 and 118 NI Act standing in favour of complainant.

36. Having considered the entire evidence, complainant successfully proved all the essential requirements of Section 138 of the Act. Accordingly, accused is guilty for committing the offence punishable u/s 138 of the Act, he is hereby convict- ed for the offence under section 138 of the Act. Let he be heard on point of sentence separately.

Announced in open court on                      SATVIR SINGH LAMBA
26th Day of May, 2014                           MM-01(NI ACT)WEST/DELHI


Axis Bank Ltd. (Formerly Known As ... vs . on 17 February, 2014

IN THE COURT OF SH. RAVINDER SINGHII, METROPOLITAN
                                        MAGISTRATE (NI) ACT - 11
                                       DWARKA COURTS, NEW DELHI.

Case No. : 241/12
Unique Case ID No: 5R0771292009

Axis Bank Ltd. (Formerly known as UTI Bank Ltd.)
4/6B, Asaf Ali Road, New Delhi.
(Through its Authorized Representative)     ...................COMPLAINANT

                                         Vs.
Praveen Gupta
S/o Late Sh. M.S. Gupta
R/o DG2/44A, Ground Floor,
Near HDFC Bank Ltd.,
Vikas Puri, Delhi110018.
Also At
3626/255A, Bhola Ram Market
Morigate, Delhi110006                  ........................................ACCUSED

Date of Institution:                                                      21.05.2009
Plea of the accused:                                              Pleaded Not Guilty
Date of Reserving Judgment:                                               17/12/2013
Date of Judgment:                                                         17/02/2014
Sentence/final Order:                                                      Convicted

                                     JUDGMENT
1 By way of present judgment I shall decide the present complaint case under Section 138 of Negotiable Instrument Act 1881 (as amended up to date, herein after said as NI Act) filed by the complainant Axis Bank Ltd. through its Authorized Representative against the accused Praveen Gupta S/o Late Sh. M.S.Gupta.


FACTS OF THE PRESENT COMPLAINT CASE 2 The factual matrix as per the allegations in the complaint which are necessary for disposal of the present case are that, the accused is customer of the complainant bank and maintains a personal account bearing No. 245010601468450 with the complainant bank and CC No. 241/12 Axis Bank Vs Parveen Gupta Page1/12 accordingly, the accused has taken a personal loan of Rs. 13,98,000/ from the complainant bank. It is alleged that for the repayment of the said loan through equated monthly installment the accused handed over two post dated cheque's to the complainant bearing No. 844919 and 844920 dated 20.12.2008 and 20.01.2009 respectively both amounting to Rs. 39,334/ each, both drawn on Canara Bank Tagore Garden, New Delhi, Branch. It is further alleged that the complainant presented the aforesaid cheque's given by the accused for encashment and on presentation of the same both the cheque's were dishonored vide cheque returning memo dated 21.03.2009 with remarks "Account Closed". It is further alleged that the complainant thereafter has given a legal notice of demand dated 09.04.2009 to the accused through registered AD on 13.04.2009 and through U.P.C. on 09.04.2009 and the same was served upon the accused thereby calling upon the accused to make the payment of the cheque's amount. It is alleged that the accused has failed to pay any sum in response to the legal demand notice as a result of which the complainant has filed the present complaint for prosecution of the accused U/s 138 of the NI Act.


3 After complaint was filed, the AR for the complainant Sh. Mohit Arora has lead his pre summoning evidence by way of an affidavit and after hearing the Ld. Counsel for the complainant and considering the entire material and documents on record, summons were issued against the accused by the Court vide order dated 05.06.2009 for the offence U/s 138 of NI Act. On appearance of the accused a separate notice U/s 251 Criminal Procedure Code (herein after said "the Code") dated 06.10.2010 was given to the accused to which he pleaded not guilty and claimed trial. Thereafter, the case was listed for complainant's evidence.

 COMPLAINANT'S EVIDENCE


4. Sh. Govind Singh, AR for the complainant got himself examined as CW1 and filed an affidavit in evidence Ex. CW1/A. He got exhibited the certificate of incorporation of the complainant company as Ex. CC No. 241/12 Axis Bank Vs Parveen Gupta Page2/12 CW1/1, authority letter in his favour as Ex. CW1/2A, statement of account of the accused as Ex. CW1/2, the original cheque's in question as Ex. CW1/3 and Ex. CW1/4, the Cheque returning memo as Ex. CW1/5, legal notice of demand dated 09.04.2009 as Ex. CW1/6. Postal receipts and U. P. C. certificate as Ex. CW1/7, Ex. CW1/8 and Ex. CW1/9 respectively, returned AD Card as Ex. CW1/10 and Ex. CW1/11, Statement of Account of the accused as Ex. CW1/13 (wrongly written as Ex CW 1/12 in chief examination dated 22/3/2013) and power of attorney in his favour as Ex CW1/2B (produced during cross examination). CW1 Govind Singh was cross examined by the Ld. Counsel for the accused. Thereafter, the complainant evidence was closed at request of the AR for the complainant.


STATEMENT OF THE ACCUSED UNDER SECTION 313 OF THE CODE 5 The statement of accused was recorded U/s 313 of the Code in which all the incriminating evidence were put to the accused Praveen Gupta in which he admitted that he has taken loan of Rs. 13, 98,000/ from the complainant in the year September, 2007. It was further submitted by the accused that he has not delivered the cheque's in question to the complainant for discharging any liability. It was further stated by the accused that the cheques in question were handed over by the accused to the complainant in a blank manner after putting his signatures thereon as a security at the time of taking of the loan from the complainant. Accused further stated that he owes no liability towards the complainant and all the payment have been made by him to the complainant. Accused also stated that he has not received the legal demand notice from the complainant and further also denied the signatures on the return AD Card. The accused further stated that the present complaint case has been falsely instituted against him and his security cheque's are misused by the complainant just to implicate him in the present case. Altogether accused denied all his liability.


CC No. 241/12 Axis Bank Vs Parveen Gupta Page3/12 DEFENCE EVIDENCE 6 Thereafter, the case was fixed for defence evidence. Accused has examined himself as DW1. DW1 was cross examined by the Ld. Counsel for the complainant. Thereafter, defence evidence was closed at request of the accused and the case was listed for final arguments.
7 Final arguments were addressed on behalf of both the parties. I have heard Ld. Counsels for both the parties and have given my anxious and thoughtful consideration to submissions made. Further I have also carefully perused the entire case file and the evidence on record.


Before proceeding further it is imperative for me to go through the relevant provisions of law "138. 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, of 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:
 Provided that nothing contained in this section shall apply unless
 (a) the 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;
 (b) 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
 (c) the drawer of such cheque fails to make the 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.

 Explanation:For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability.


CC No. 241/12 Axis Bank Vs Parveen Gupta Page4/12 APPRECIATION OF EVIDENCE IN THE LIGHT OF INGREDIENTS OF SECTION 138 NI ACT

8. The presentation, dishonor of the cheque's in question Ex.
 CW1/3 and Ex. CW1/4 and the cheque returning memo Ex. CW1/5 has not been challenged by the accused. Therefore, considering the entire evidence on record it stands duly proved that the Cheque's in question Ex. CW1/3 and Ex. CW1/4 were dishonored vide cheque returning memo Ex. CW1/5 with the reason "Account Closed".


9. In the instant case specifically three fold defence has been taken by the accused Firstly, that he has not been served with any legal demand notice by the complainant Secondly, that apart from the signatures no other particulars in the cheque's in question Ex. CW1/3 and Ex. CW1/4 has been filled by him. Thirdly that he has made payments against the cheque's in question Ex. CW1/3 and Ex. CW1/4 and further he has not given the cheque's in question to the Complainant in discharge of his liability and the same were given by him as security to the complainant at the time of taking of the loan.
10 Coming to the first line of defence taken by the accused, in the case in hand AR for the complainant (CW1) Sh.Govind Singh, has specifically stated in his affidavit of examination in chief that he has got issued the legal notice of demand dated 09.04.2009 which is Ex. CW1/6 and it was sent to the accused vide registered Post on 13.04.2009 and vide UPC on 09.04.2009, receipts of which are Ex. CW1/7, Ex. CW1/8 and Ex. CW1/9 respectively. The return AD Card Ex. CW1/10 and Ex. CW1/11 is also placed on record by the complainant.


11. The accused has denied the receipt of legal demand notice both at the time of his statement U/s 313 of the Code and also in his evidence as DW1. Further the accused also stated that the return AD card Ex.CW1/10 and Ex. CW1/11 does not bear his signatures. I have perused the legal notice of demand. It bears the correct address of the accused and the postal receipts issued by the postal authorities in CC No. 241/12 Axis Bank Vs Parveen Gupta Page5/12 ordinary course are also on record. Interestingly during cross examination of the accused as DW1 it has been stated by the accused that the address mentioned on the legal demand notice is his correct address. Accused has further stated that he is residing at the address mentioned in the complaint since the year 2007


12. Further Section 27 of General Clauses Act also raises a presumption in favour of the complainant that properly addressed documents sent by the registered post is deemed to have been delivered if not returned back.

 Section 114 Illustration (f ) of Indian Evidence Act, 1872 also reads as follows: "114. Court may presume existence of certain facts  The Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case.

 Illustration The Court may presume  (f ) That the common course of business had been followed in particular cases; "

13. Both the presumptions provided in Section 114, Illustration (f ) of the Evidence Act, 1872 and Section 27 of the General Clauses Act, 1897 remains unrebutted through out the trial. Further accused has himself admitted that the address mentioned on the legal demand notice is his correct address and he is residing at the said address since the year 2007. Therefore, in the absence of any cogent evidence mere denial on the part of the accused would not be sufficient to shake the stand of the complainant. Therefore considering the evidence on record, I find that the accused has not brought any credible and cogent evidence to prove that he has not been served with the legal demand notice by the complainant. Therefore, I hold that the legal CC No. 241/12 Axis Bank Vs Parveen Gupta Page6/12 notice of demand Ex. CW1/6 was duly served upon the accused.


14. Now coming to the second line of defence taken by the accused that apart from the signatures no other particular in the cheque's in question Ex. CW1/3 and Ex. CW1/4 has been filled by him. It is not disputed by the accused that the Cheque's in Question Ex. CW1/3 and Ex. CW1/4 are drawn on the account maintained by him. Further signature on the cheque's in question Ex. CW1/3 and Ex. CW1/4 has also not been disputed by the accused. During the defence evidence accused as DW1 has specifically contended that except signatures other particulars in the cheque's in question Ex. CW1/3 and Ex. CW1/4 has not been filled by him. During the course of arguments Ld. Counsel for the accused also contended that the except signatures other particulars on the cheque's in question Ex. CW1/3 and Ex. CW1/4 has not been filled by the accused. It is trite to say that by putting the name and date there is no material alteration on the cheque U/s 87 of the NI Act. There is no rule of banking business that the name of the payee as well as the amount should be written by the drawer himself as no law provides that in case of cheque the entire body has to be written by the drawer only. Therefore, once the signature on the cheque in question is admitted the plea that particulars in the cheque's in question has not been filled by the drawer is of no consequence. (See T. Nagappa Vs. Y.R. Muralidhar, (2008) 5 SCC 633, Ravi Chopra Vs. State and Another, 2008(2) JCC (NI) 169, Delhi, Jaipal Singh Rana Vs. Swaraj Pal 149 (2008) DLT 682, P.S.A. Thamotharan


Pal 149 (2008) DLT 682, P.S.A. Thamotharan Vs. Dalmia Cements (P) Ltd., 2005 (1) JCC (NI) 96 Madras, Jammu & Kashmir Bank vs. Abhishek Mittal, 2012 CD DCR


189) Therefore the arguments and contentions of the accused in this regard also hold no ground.


15. Now coming to the third line of defence taken by the accused that he has made payments against the Cheque's in questions Ex. CW1/3 and Ex. CW1/4 and the cheque's in question were not given by him to the Complainant in discharge of his liability and the same CC No. 241/12 Axis Bank Vs Parveen Gupta Page7/12 were given as security to the complainant at the time of taking of the loan. No doubt the crux of penal liability under Section 138 of the NI Act is that the Cheque in question must be issued for the discharge of any legal debt or liability. Existing of legal debt or liability is sine qua non for constituting the offence.

16. Before I advert to the above said line of defence taken by the accused, it is imperative for me to notice the presumptions under Sections 118(a) and 139 of the NI Act which read as under:
 "118. Presumptions 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, indorsed, negoti ated or transferred, was accepted, indorsed, negotiated or transferred for consideration;"

 "139. Presumption in favour of holder.--It shall be pre sumed, unless the contrary is proved, that the holder of a cheque received the cheque, of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.