Distt. Court Rohini Delhi (07.02.2022) in Manmohan Bansal Vs. Saroj Sharma [CC NI Act No. 119/2021 ] held that;-
It is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption has been established...but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary.
As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own.
Accused needn't examine himself to prove his defence. He can do so with help of material already on record i.e. by cross examining the complainant and/or his witnesses.
Though, rebuttal does not have to be conclusively established, nevertheless, the evidence must be such that the court either believes the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the prudent man.
If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.
The aforesaid provision (section 3 of the Punjab Registration of Money Lenders Act, 1938 ) does not debar a money lender from instituting a complaint under Section 138 of the Negotiable Instruments Act, 1881, which is a remedy enforceable before a criminal court, and totally independent of a civil suit.
Whether, or not, the appellant reflected the availability of the said amount in her income tax returns, is also not a matter of concern for this Court. That would again be an aspect to be considered by the income tax authorities.
The payer of the money in cash in violation of Section 269 SS of the Income Tax Act would, therefore, be entitled to enforce an agreement of advancement of money in cash beyond Rs.20,000"
The NI Act does not per se carve out an exception in respect of a 'security cheque' to say that a complaint in respect of such a cheque would not be maintainable…
Thus, merely because cheques in question are security cheques, would not save accused from clutches of law, latter having admitted taking loan against the cheques.
Excerpts of the order;
# 1. Complainant's Version:
The complainant has stated that on account of good friendly relations, he advanced a loan of Rs 80,000/ to the accused in the month of February 2020 as the latter was in dire need of money for her parlour namely "makeover" with a promise by the latter to repay the same within 6 months. It is further alleged by him that after much insistence in the month of August 2020, the accused sought some time "due to financial crisis" and "lockdown" but thereafter issued the two cheques each for Rs 40,000/ in complainant's favour, which were not honoured by the accused due to insufficiency of funds in her bank account, leading to the complainant issuing a legal demand notice in the month of October 2020 and eventually the present complaint. Complainant tendered his evidence affidavit, relied upon following documents:
1. Original cheque bearing no 113542 dt 06.10.2020 for sum of Rs. 40,000/ drawn at IDBI Bank, Ashok Vihar Phase II, New Delhi annexed at page no 3738 of digital file Ex. CW 1/1;
2. Original Bank returning memo (for instrument no 113542 ) dt. 16.10.2021 with remarks "funds insufficient" annexed at page no 39 of digital file Ex. CW 1/2;
3. Original cheque bearing no 113543 dt 06.10.2020 for sum of Rs. 40,000/ drawn at IDBI Bank, Ashok Vihar Phase II, New Delhi annexed at page no 4040A of digital file Ex. CW 1/3.
4. Original Bank returning memo (for instrument no 113543) dt. 16.10.2021 with remarks "funds insufficient" annexed at page no 41 of digital file Ex. CW ¼
5. Copy of Legal demand notice dt. 29.10.2020 annexed at page no 4245 of digital file Ex. CW ⅕
6. Original Postal receipt bearing consignment no ED727428494IN annexed at page no 45A of digital file Ex. CW ⅙
7. Printed copy of internet generated tracking report annexed at page no 46 of digital file Ex. CW 1/7
8. Copy of reply to legal notice dt 11.11.2020 annexed at page no 4751 of digital file Ex. CW 1/8
Ld. counsel for the complainant has placed reliance upon Bir Singh v Rajesh Kumar 2019 (4) SCC 197; M/s. Kumar Exports v. M/s. Sharma Carpets, [2009 A.I.R. (SC) 1518]
# 2. The Defence:
The accused entered appearance and pleaded not guilty. In her plea of defence recorded on 17.02.2021, the accused admitted being the drawer of the cheque. She admitted having signed the same but denied filling any other particular. The accused conceded to having taken loan from the complainant but stated the same was borrowed by her in two instalments of rs 40,000 each firstly on 15.06.2019 and then on 18.06.2019 with interest at 5% per month to be paid in 12 monthly instalments of Rs 6000/ each and that she has already repaid the entire principal amount of Rs 80,000 and has also repaid a substantial portion of interest and only few instalments are outstanding. She further testified that the complainant forcibly took away 6000/ in cash on two occasions during lockdown. She admitted having replied to the legal demand notice. In her favour she has produced Ex Marked "A" & Mark "B" Money Lending Cards.
# 3. The legal Provisions:
3.1.Section 138, section 118r/section 139 N.I. Act 3.1.1. Pertinent here it is to refer to section 138 N.I. which mandates that all of the following legal requirements needs to be fulfilled to constitute an offence of cheque bounce:
(i) 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;
(v) The payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(vi) The drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice.
3.1.2. Section 118 of the N.I Act provides : "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, negotiated or transferred was accepted, indorsed, negotiated or transferred for consideration;"
3.1.3. Section 139 of the N.I Act further provides as follows:
"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 referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability"
3.2. When read together, aforementioned provisions raise a presumption of law that if a person issues a cheque in favour of another, it implies that the drawer owes a debt or a liability towards the holder of the cheque. Since, both Sections 138 and 139 uses the phrase `shall presume', "it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption has been established...but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary" (Hiten P. Dalal vs Bratindranath Banerjee (2001) 6 SCC 16.
Hon'ble Apex court in its judgement titled as Rangappa vs S. Mohan, (2010) 11 SCC 441 while discussing applicability of section 139 section 118 of N.I. Act also observed as follows:
"Para 27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused/defendant cannot be expected to discharge an unduly high standard or proof"
"Para 28 ...As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own"
3.3. It is also pertinent to refer to definition of "Proved", "Disproved" and "Not proved" as incorporated in section 3 of Indian Evidence Act 1872
"Proved". -- A fact is said to be proved when, after considering the matters before it, the Court; either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.
"Disproved". -- A fact is said to be disproved when, after considering the matters before it, the Court either believes that it does not exist, or considers its nonexistence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it does not exist.
"Not proved". -- A fact is said not to be proved when it is neither proved nor disproved.
3.3. From the above discussion, following becomes clear:
(a) Initially, it is upon the complainant to prove foundational facts.
(b) Once foundational facts are proved, it is mandatory upon the court to raise presumption under section 118r/w section 139 of NI Act i.e. cheque has been issued/drawn for a consideration by the accused to discharge a debt or a liability in favour of the holder of cheque. In other words, it shall be presumed that the accused/drawer of the cheques owes any legal liability or debt to the holder of the cheque/complainant.
(c) Accused can rebut the presumption.
(d) The burden of proof upon accused is not to prove his defence beyond all reasonable doubts but raise a probable defence
(e) Accused needn't examine himself to prove his defence. He can do so with help of material already on record i.e. by cross examining the complainant and/or his witnesses.
(f) Though, rebuttal does not have to be conclusively established, nevertheless, the evidence must be such that the court either believes the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the prudent man.
4. Appreciation of Evidence and Application of Legal principles On perusal on record, I find parties are at variance only with regards to one aspect: Existence of legally enforceable debt/liability.
To be more specific parties are at variance on following counts:
4.1. Before we venture to find out who has been able to prove his case successfully, it is beneficial to mention that, the accused has already admitted issuance of cheque after filling the amount in figures on the cheques in question, factum of receiving legal notice and factum of taking loan from complainant. Thus, a factual basis has been established by the complainant, by virtue of Section 118(a) and Section 139 of the NI Act, a presumption arises in his favour and against accused that accused Saroj has drawn the cheques in favour of Man Mohan Bansal because former owes a legal liability or debt to the latter.
4.2. Thus, as per law, now the burden has shifted upon the accused, who had the option to discharge the same either by punching holes in the complainant's case during cross examination and/or by adducing evidence in her favour. While adjudging whether in a case the presumption of consideration has been rebutted, it becomes important to underscore that a mere denial of liability or vague defence of blank cheque as security, cannot be taken at the mere ipse dixit of the accused. The accused has to come forth with a convincing defence that appeals to the judicial conscience. Needless to state that if on a bare denial the presumption is stated to be rebutted, that would defeat the legislative intention of having a presumption in the first place.
4.3. Let us now examine whether the accused has been able to "prove" her defence. Pertinent here is to mention that the accused also entered into witness box u/section 315 Cr.P.C.
4.3.1. (a) Coming to the date of advancement of loan, the accused did not mention the same during framing of notice u/s251Cr.P.C. During her chief examination, the accused testified that the loan was taken by her in the year 2019 and she also mentioned specific dates. No negative suggestion put by the complainant side in cross examination. On the other hand, a suggestion was put to the complainant which he denied and volunteered to add that loan was advanced on 20.02.2020. He also testified to the effect that he had money lending transactions with the accused for the last 3 years. During her examination u/s 313 Cr.P.C., the accused mentioned the dates when she borrowed money. Additionally, in paragraph 2 of her reply dt 11.11.2020, the accused has stated no personal loan has been disbursed to her in February 2020. The complainant has relied upon said reply in his evidence affidavit but has not suggested to accused that wrong facts have been stated by latter in her reply. Reading all the facts and circumstances together, it seems rather more probable that the loan in question was indeed advanced on the dates mentioned by the accused.
4.3.2. (b) Date of handing over the cheques: Accused did not mention anything about the same at the stage of framing notice. However, in her examination u/s 313 Cr.P.C. maintained a stand that cheques were not handed over in August 2020 and testified during her evidence statement that cheques were handed over by her on the date of borrowing money for the first time as security cheques. The Complainant was also cross examined on these lines specifically and testified that cheques were handed over to him before 7th August 2020 by the accused outside her beauty parlour. Complainant admitted filling the date on the cheques in question. Having said that, the accused has also not placed on record anything, except repeating herself on three different occasions, to prove the same. Thus, the alleged facts i.e cheques were handed by the accused in August 2020 is "Not Proved". Having said that, not even a suggestion has been put to the accused that cheques were handed over on august 2020. Further no negative suggestion was put to her that cheques were not security cheques. Whereas a suggestion of security cheques when put to the complainant, he has not answered the same. This deliberate omission on part of Ld. Counsel for complainant indicates and suggests that cheques were security cheques and were not handed over in August 2020.
4.3.3. (c) Now we come to the bone of contention: Repayment by the accused before cheques were presented.
Claim of entire repayment was made by accused for the first time in her plea of defence u/section 251 Cr.P.C. and further elaborated by her during her examination u/s 313 Cr.P.C and then in her chief examination, wherein she testified that loan was taken by her with interest and she has already repaid cheques amount and also a portion of interest in monthly instalments. In her Digitally chief examination, the accused also stated that certain instalments are still due against her. To prove the same accused has placed on record:
4.3.3.1. Two documents purportedly money lending cards marked as "A" & "B". An objection as to its admissibility has been raised on the ground of non providing the advance copy of the same to the opposite side. Objection is not sustainable in view of judgement of Hon''ble Delhi High Court in case titled as Subash Chander vs Shri Bhagwan Yadav 2009 SCC OnLine Del 3818. Coming to the question of proving that document. Said documents were put to the complainant who has denied making that document.
In my opinion, the accused have failed miserably to prove the document and therefore, the same cannot be read in evidence. Firstly because, despite being asked specifically, the accused stated that said document was executed by the complainant in his own handwriting in her presence and bears his signature/initials but didn't point out where exactly the complainant has allegedly signed. She testified that the same were signed in the presence of her husband, but did not examine her husband. Further, despite the opportunity, the accused did not call any handwriting expert to compare and prove the handwriting. Moving on, she also testified that the complainant is engaged in money lending business and stated in her statement under 313 CrP.C that complainant was engaged in said business near her work place. A suggestion was put to the complainant (that he is a money lender and have lended money to people besides the accused), which indicates knowledge of the accused about the complainant's alleged business but she didn't examine any such borrower to whom the complainant may have issued a similar card. If the complainant, as per accused, is engaged in business of money lending and issued document mark "A" & "B" to accused, there is a reasonable ground to presume that he must have issued similar document/s to other borrowers as well. Not only that, the accused did not examine any witness in whose presence said document may have been executed. Accused is also silent as to by whom entries of said documents were made. Interestingly, there is no mention of such a document by the accused in her reply to the legal notice nor was the same referred to by her while framing the notice.
4.3.3.2. One audioclipping was produced and referred to by the accused during her evidence allegedly containing conversation of the complainant wherein he allegedly states "apka to interest pe interest chad gaya hai aur apne koi payment nhi kari hai". Admittedly, said message was not sent to the accused at her mobile number. Said electronic evidence was not exhibited by the accused in her defence. Otherwise also, said audioclipping would not have been not admissible as per provisions of Indian Evidence Act.
The law of admissibility of electronic evidence is governed by section 65A and section 65B of Indian Evidence Act . Read together, said provisions require certain preconditions to be fulfilled before an electronic record is treated as "document" and is "admissible as evidence" without production of original. Hon'ble Apex Court in case titled as Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal, 2020 SCC OnLine SC 571 has held that requirement of a certificate under 65B(4) Indian Evidence Act is mandatory to prove a secondary electronic record barring one situations where device is not in possession of the intended party by whom the electronic record is produced. Hon'ble court further held that "Under Subsection (4), a certificate is to be produced that identifies the electronic record containing the statement and describes the manner in which it is produced, or gives particulars of the device involved in the production of the electronic record to show that the electronic record was produced by a computer, by either a person occupying a responsible official position in relation to the operation of the relevant device; or a person who is in the management of "relevant activities" - whichever is appropriate. What is also of importance is that it shall be sufficient for such matter to be stated to the "best of the knowledge and belief of the person stating it". Here, "doing any of the following things..."must be read as doing all of the following things, it being well settled that the expression "any" can mean "all" given the context...the conditions mentioned in subsection (4) must also be interpreted as being cumulative."
The Court further explained that "All these safeguards are taken to ensure the source and authenticity, which are the two hallmarks pertaining to electronic record sought to be used as evidence. Electronic records being more susceptible to tampering, alteration, transposition, excision, etc. without such safeguards, the whole trial based on proof of electronic records can lead to travesty of justice."
Once, such electronic record is admitted, to prove such electronic record in form of voice recording, following also needs to be fulfilled:
a) The statement must be relevant according to the rules of the Indian Evidence Act;
b) The voice of the person, against whom such recording is being produced as evidence, must be duly identified by the person who is producing such recording as evidence;
c) The voice of the person should be clearly audible and not lost or distorted by other sounds or disturbances and;
d) Every possibility of tampering with either whole or any part of the such recorded statement must be ruled out; otherwise, it may render the said statement out of context Accused did not produce the original electronic record. Coming to the 65 B certificate furnished by the accused in the instant matter whereas allegedly the same was received by her husband at his mobile number. Therefore, said certificate should have been given by her husband. Furthermore, the same can be said to be sketchy at best. It doesn't answer when and from which mobile number the alleged call was received, how the same was stored in pendrive and what sources/devices were used in the process. Thus, the entire chain of custody is missing, casting a shadow of doubt over its authenticity. Further, despite opportunity is granted to accused vide order dt 05.10.2021 to file a fresh 65 B certificate, the accused has chosen not to do so. Furthermore, the said recording was never put to the complainant during cross examination nor the accused asked for any voice sampling to identify the voice of the speaker.
4.3.3.3. If the accused had already made the entire payment of the cheque amount, the same should have been mentioned by her in reply Ex CW1/8. Instead, in her reply to legal notice, paragraph no "3" of preliminary objections, the accused has stated that she has "disbursed 80 percent of payment" to the complainant. Further, the accused has not demanded return of cheques in question, rather seems worried about the fact that cheques have been presented without prior intimation to her. Further, the accused has testified in her evidence that she made repayments in monthly instalments in cash. However, to substantiate the same, neither she has placed on record any bank account statement reflecting withdrawals nor examined any witness. It is hard to believe and highly improbable that there is no witness to any transactions between accused and complainant, be it borrowing money, handing over cheques, or alleged payments in 10 monthly instalments. Further, the accused has neither placed on record any police complaint referred to by her in her reply (Ex CW1/8) to legal notice and in her cross examination nor examined the person namely Archana who allegedly harassed her in collusion with the complainant.
4.4 Now let's deal with contentions raised by the accused during trial.
4.4.1. Particulars on cheques i.e. Date has been admittedly filled by the complainant.
Ld counsel for complainant has argued that he is relying upon judgement of Hon'ble Supreme Court in the case of Bir Singh v. Mukesh Kumar 2019 (4) SCC 197. Law in this regard is no longer res integra. An observation to this effect has been made by hon'ble court in Bir Singh (Supra): "If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence". Reference here can also be made to the judgement of Hon'ble Delhi High Court delivered by Justice Murlidhar in a case titled as Ravi Chopra vs State And Anr. on 13 March, 2008, wherein Hon'ble court after referring to section 87, 20 and section 49 of NI Act, upheld order of Ld. Trial Court dismissing application for forensic examination of cheque. Thus, accused can not be exonerated merely because certain particulars were filled by some third person.
4.4.2. Ld counsel for the accused has argued that the complainant is engaged in the business of money lending without a licence.
Firstly, the accused has not placed on record any material to substantiate said argument, except for suggestion during cross examination which was denied by the complainant. It is well settled that for an activity to be called money lending under the said Act, there should be a systematic business of money lending which should be repetitive and continuous and the loans are granted to a large number of persons.
Even if it is presumed, for argument's sake, that the complainant is a money lender, the same can't save the accused's sinking ship in light of settled legal position. Reference can be made to Virender Singh vs Deepak Bhatia on 8 April, 2011 delivered by Justice G.P. Mittal . In said case, 23 separate complaints were dismissed by Ld. Trial Court on the ground that complainant/petitioner was engaged in business of money lending without licence and the complaint was barred under Section 3 of the Punjab Registration of Moneylenders Act, 1938. After referring to definition of "loan" in section Section 2(8) of the Act of 1938 which specifically excludes an advance made on the basis of a negotiable instrument, Hon'ble court held that the bar of Section 3 of the Act of 1938 is not attracted to a loan given on the basis of a negotiable instrument, like a cheque. Further, in Kajal v. Marwah [Crl. Appeal No. 870/2013, dated 27.03.2014, Delhi High Court], the Hon'ble Court categorically held that "The aforesaid provision (section 3 of the Punjab Registration of Money Lenders Act, 1938 ) does not debar a money lender from instituting a complaint under Section 138 of the Negotiable Instruments Act, 1881, which is a remedy enforceable before a criminal court, and totally independent of a civil suit.
4.4.3. Ld counsel for accused has argued that complainant has not disclosed factum of lending money in ITR, therefore same cannot be termed to be legally enforceable liability in view of the bar of Section 269SS of the Income Tax Act.
Interestingly, Hon'ble Delhi High Court in a case titled as Sheela Sharma v. Mahendra Pal, 2016 SCC OnLine Del 4696, set aside the order of Ld. Trial court, which acquitted accused interalia on grounds that complainant was not ITR payee and loan was advanced by way of cash in contravention of section 269SS of the Income Tax Act. Hon'ble Court held that the mere advancement of the loan in cash, may entail consequences for the party acting in breach of Section 269 SS of the Income Tax Act. That is not the concern of this Court. "Whether, or not, the appellant reflected the availability of the said amount in her incometax returns, is also not a matter of concern for this Court. That would again be an aspect to be considered by the incometax authorities. The advancement of loan, in cash, to the tune of Rs.10 Lakhs is not prohibited in law. The transaction of advancement of loan of Rs.10 Lakhs, in cash, does is not illegal. Such a transaction is enforceable at law. Breach of Section 269 SS of the Income Tax Act provides the penalty to which the person would be subjected to under Section 271D of the Income Tax Act. Section 271D does not provide that such a transaction would be null & void. The payer of the money in cash in violation of Section 269 SS of the Income Tax Act would, therefore, be entitled to enforce an agreement of advancement of money in cash beyond Rs.20,000"
In another case titled as Guddo Devi @ Guddi vs Bhupender Kumar delivered by Justice Vibhu Bhakru on 11 February, 2020, conviction was challenged by accused interalia on the basis that debt owed by the petitioner was rendered unenforceable by virtue of the provisions of the Income Tax Act, 1961. Said contention was dismissed with observation that section 269SS of the Income Tax Act, 1961 prohibits making of any payment in cash above a sum of ₹20,000/. Thus, any person violating the same would attract imposition of penalties under the said Act. However, the same does not render the said debt unenforceable or precludes the lender from recovering the same. Moreover, plain reading of section 269SS along with section 271 D makes clear that the same applies to persons who either take or accept cash of Rs 20,000/ or more and not who gives cash. Thus, the argument of ld counsel is without any merit.
4.4.4. Burden of proving the Documents Marked as "A" & "B" is upon the complainant.
Ld counsel for the accused has vehemently argued that it is not upon the accused to prove the said document, rather burden lies upon the party (i.e. complainant) who has denied making the document.
It is apt to mention relevant provisions relating to burden of proof under Indian evidence Act.
Sec. 101. Burden of proof Whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist.
102. On whom burden of proof lies.--
The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side Section 103 enacts: " The burden of proof as to any particular fact lies on that person who wishes the Court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person".
And, section 106 lays down:
"106. When any fact is especially within the knowledge of any person, the burden of proving that fact is upon him".
Hon'ble Supreme court has in cases titled as Anil Rishi vs Gurbaksh Singh 2006 (5) SCC 558 has referring to section 101 observed that "In terms of the said provision, the burden of proving the fact rests on the party who substantially asserts the affirmative issues and not the party who denies it." And "In deciding which party asserts the affirmative, regard must of course be had to the substance of the issue and not merely to its grammatical form, which latter the pleader can frequently vary at will, moreover a negative allegation must not be confounded with the mere traverse of an affirmative one. The true meaning of the rule is that where a given allegation, whether affirmative or negative, forms an essential part of a party's case, the proof of such allegation rests on him" (Narayan Govind Gavate Etc vs State Of Maharashtra 1977 AIR 183) In the instant case, the whole defence of the accused is based upon the existence of a document marked as "A" and "B". She has deposed that the same has been signed by the complainant in her presence. It is on the basis of said document, that the accused is claiming that she has made payment in monthly instalments. Thus, clearly the initial burden to prove the alleged factum of issuance of documents marked "A" & "B" by the complainant lies upon the accused.
4.4.5. cheques issues as security cheques As a last resort, Ld counsel for the accused has argued that the cheques in question have been issued a security cheques and that in itself does not create any legal liability. Ld counsel has placed reliance upon Sudhir Kumar Bhalla vs Jagdish Chand, 2008 (2) JCC (NI)241; Anjelus Topno Vs Shree Kant Sharma 2016 (3) DCR 677; Anand Chaturvedi Vs I.S. Mourya 2016 (3) DCR 233.
Unfortunately, none of the judgements relied upon by Ld counsel for the accused are applicable to the facts of the present case. Sudhir Kumar (supra) is not applicable to facts of present case, as in said case, observations were made by Hon'ble Supreme Court in light of the contested fact that cheque has been materially altered by complainant/respondent by adding a Zero, supported by evidence of Document Expert. Anjelus(supra) is also inapplicable to facts of present matter, as accused in said case succeeded in proving repayment by way of cheque as he examined Bank witness in his favour.
Further no support can be drawn from Anand Chaturdevi (supra) as accused was successful in proving certain documents, also admitted by complainant, as per which complainant had agreed to return the cheque of the accused.
It requires mentioning that the observations of courts have to be read in the context in which they were made. They can not be taken out of context and understood as laying down a general proposition that a cheque issued as security would not come within the purview of Section 138 of the NI Act in all cases. Such reading of the judgement would go contrary to the express language used in Section 138 of the NI Act, which uses the expression, 'where any cheque". Thus, this argument is also devoid of merit, as security cheque does not ipso facto absolve the accused from legal liability.
The question of maintainability of complainant u/section 138 in case of security cheque was examined by Justice Vipin Sanghi in judgement titled as Suresh Chandra Goyal v. Amit Singhal [Crl.L.P. No. 607.2014, Delhi High Court]. It was observed: "Para 28 There is no magic in the word "security cheque", such that, the moment the accused claims that the dishonoured cheque (in respect whereof a complaint under Section 138 of the Act is preferred) was given as a "security cheque", the Magistrate would acquit the accused. The expression "security cheque" is not a statutorily defined expression in the NI Act. The NI Act does not per se carve out an exception in respect of a 'security cheque' to say that a complaint in respect of such a cheque would not be maintainable..." After analysing the meaning of the word "security" as defined in various sources further observed "Para 61 Thus, in my view, it makes no difference whether, or not, there is an express understanding between the parties that the security may be enforced in the event of failure of the debtor to pay the debt or discharge other liability on the due date. Even if there is no such express agreement, the mere fact that the debtor has given a security in the form of a post dated cheque or a current cheque with the agreement that it is a security for fulfillment of an obligation to be discharged on a future date itself, is sufficient to read into the arrangement, an agreement that in case of failure of the debtor to make payment on the due date, the security cheque may be presented for payment, i.e. for recovery of the due debt. If that were not so, there would be no purpose of obtaining a security cheque from the debtor. A security cheque is issued by the debtor so that the same may be presented for payment. Otherwise, it would not be a security cheque".
Thus, merely because cheques in question are security cheques, would not save accused from clutches of law, latter having admitted taking loan against the cheques.
4.4.6. Ld counsel for the accused has also argued mere admitting execution of cheques by the accused will not render her liable under section 138 NI Act and further argued that complainant has failed to his case beyond all reasonable doubts and therefore, benefit of doubt be given to accused.
Ld counsel has placed reliance upon judgement of Hon'ble Madras High Court in P.S.K. Finance and Chit Funds Ltd. vs B. Uma Ali & Ors. 2019 (3) DCR 171; Hon'ble Kerala High Court in T.G. Polymer & Co. v K.S. Shaji And Ors. 2017 (2) DCR 740; R. Sekaran v N. KrishnaMoorthy 2017 (2) DCR 197; Hon'ble Bombay High Court in Ms. Anu Tripathi V Mr. Anil Kumar GUpta & Ors. 2017(2) DCR 216 The above mentioned case laws are of no help to the accused, as none of the cases relied upon by the Ld counsel for accused are applicable to the facts of the present case.
In P.S.K. (supra), the order of acquittal was upheld on the ground that complainant/appellate being Chit Fund Company, ought to have maintained record but has failed to place on record any evidence oral and documentary (in form of Pronote and Guarantee letter)show role of accused persons/Respondent 1 to 3 in alleged transaction of loan to one person namely Govindasamy.
In T.G. Polymer (supra), the order of acquittal was upheld as complainant failed to prove in what capacity accused allegedly purchased goods from complainant/appellate firm and further because it failed to prove conscious execution of the cheque. Accused, who was prosecuted in capacity of Managing director of a company, in said case did not adduce any positive evidence but stated in his statement u/313 CrP.C. that cheque was given to one T.G. Lal, procured by the complainant's wife from the wife of T.G. Lal after the latter's demise and further denied any transaction with the complainant's firm at relevant time.
In R. Sekaran (Supra), the order of acquittal was upheld on ground that complainant failed to prove his financial capacity to advance a loan of Rs 3,00,000/ to the accused, who denied taking loan from complainant.
In Anu Tripathi (supra)order of acquittal was upheld interalia on grounds that complainant had admitted that she is in possession of various signed cheques of the accused kept with her for making payments to other people.
5. CONCLUSION Here, it deserves reiteration that the accused failed miserably to prove alleged factum of repayment. No handwriting expert was examined by her to prove the alleged handwriting or signatures/initials of the complainant on the document marked "A" & "B". Further, no other person was called by the accused to prove said document who may have seen the complainant executing either of the documents or similar documents. Since, the accused has failed to prove that the aforesaid documents bear signature of the complainant/appellant, no reliance can be placed upon said document. No witness was examined by her who may have seen the accused's husband making payment in instalments. Accused didn't even examine her husband. She also did not place on record any bank statements. Further, in her reply dt 11.11.2020 to legal notice (Ex. CW1/8), the accused did not insist on taking back the cheques in question, rather stated therein that she has returned 80 percent of the amount and expressed anguish over cheques being presented without her knowledge. Further, the accused didn't issue any "stop payment" instructions to the bank. Despite opportunity, she didn't place on record any police complaint as referred to by her during her evidence. Even if everything is taken out of the purview, I fail to understand how a reasonably prudent person who has paid a sum of money more than she borrowed would wait in silence, and not protest over her cheques not being returned.
It is trite that an accused has to prove his defence by preponderance of probabilities, but a defence would be considered probable only if it appeals to the Court as probable and reasonable keeping in mind the natural course of conduct of a prudent human being of reasonable intelligence. The inaction of the accused in the facts and circumstances of the present case is unnatural.
The sheer lack of even an iota of material on the record, leads to the irresistible conclusion that the defence of the accused is sham and nothing but an implausible story.
All factors cumulatively seen, go on to show that the accused has miserably failed to probablise lack of legal liability with respect to the cheques in question. The presumption of legal liability, therefore, has gone unrebutted. The complainant has successfully proved the basic ingredients of offence u/s 138 of the N.I.Act. Resultantly, the accused Saroj is convicted of offence u/s 138 of the N.I.Act.
Let a copy of this judgment be provided forthwith to the convict, free of cost. A copy of the same be also uploaded as per rules.
-----------------------------------------------
