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TMI Blog2022 (11) TMI 1373X X X X Extracts X X X X X X X X Extracts X X X X ..... nding (MOU) dated 19th November 2009 executed between the appellant and respondent No. 1 wherein the appellant agreed to buy property bearing Survey No. 32/1 of village Colvale for a consideration of Rs. 7,50,000/- from the respondent. Since the respondent failed to perform his part, he issued a cheque for an amount of Rs. 15,00,000/- towards breach of contract and damages. On presentation of the said cheque with the bankers, it was returned with an endorsement "Opening balance insufficient". A demand notice dated 19th February 2021 was issued which was replied to by the respondent vide letter dated 7th March 2019 refuting the allegations in the notice. Complaint was filed under Section 138 of the Negotiable Instrument Act before the learned Magistrate at Mapusa. Process was issued against the respondent who appear and contest the matter. The appellant examined himself. Respondent No. 1 examined himself and one witness. The learned Magistrate vide impugned judgment and order dated 16th December 2016 dismissed the complaint and acquitted the respondent. 5. The learned Counsel for the appellant submitted that the impugned judgment is perverse and against the settled proposition of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 138 of the Negotiable Instrument Act, there are clear averments that the appellant and respondent were known to each other and that the respondent is in the business of selling properties in the State of Goa. The appellant was interested in purchasing some property whereas the respondent was holding Power of Attorney for Ms. Iris D'Souza and Mr. Walter Diniz Mendonca with respect to immovable property having a residential house bearing House No. 15/3, together with larger property known as "Tolencho Sorvo" or "St. Roque Waddo" admeasuring 675 sq. mtrs. bearing Survey No. 32/1 of village Colvale, Bardez, Goa. The respondent offered the said property to the appellant for an amount of Rs. 7,50,000/-. The respondent also represented that the said property is having clear and marketable title and there is no dispute of any nature. Since the appellant liked the said property and on the basis of the representations made by the respondent, he agreed to purchase it for Rs. 7,50,000/-. Accordingly, a MOU dated 19th November 2009 was executed between the appellant and respondent who represented the owners of the said properties as their lawful attorney. The said MOU dated 19th Novemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in negative. 13. At this stage, it is required to observe that Chapter XVII of Code of Criminal Procedure 1973 ('CrPC' for short) deals with the judgment. Section 354 of CrPC mandate that the judgment contained point or points for determination, decisions thereon and the reasons for such decision. The whole purpose of framing of points is to understand the case put forth, the law applicable to the fact and the decision against it. 14. In the matters arising out of Section 138 of the Negotiable Instrument Act, framing of point while delivering judgment assumes much importance as first of all the Magistrate has to consider ingredients of Sections138 r/w. 139 of the Negotiable Instrument Act. Similarly, the Magistrate has to keep it in mind provision of Section 140 of the Negotiable Instrument Act which says that it shall not be a defence in a prosecution for an offence under Section 138 that the drawer had no reason to believe when he issued the cheque that the cheque may be dishonoured on presentment for the reasons stated in that section. 15. Thus, framing of points is a stage only when the judgment is dictated and not prior to it. At that stage, entire material is ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the schedule below for Rs. 7,50,000/- (Rupees Seven Lakh Fifty Thousand only)" 18. The MOU then proceeds further and record as under in paragraphs No. 1 to 9.: 1. That Party No. 1 has agreed to sell the said property to Party No. 2 for fair market value price of Rs. 7,50,000/- (Seven Lakhs Fifty thousand only). 2. That the party No. 2 has advanced to Party NO. 1 Rs. 5,00,000/(Rupees Five Lakhs) towards this agreement for sale. Out of which is Rs. 2,50,000/- (Rupees Two lakhs fifty thousand only) issued through ING VYSYA., PANJIM BRANCH, CHEQUE NO. 349732, dated 9/05/08 and Rs. 2,50,000/- (Rupees Two Lakhs fifty thousand only) by way of cash which is duly acknowledged by Party No. 1 of sum of having received the said sum of Rupees 5,00,000(Rupees Five Lakhs only). 3. That the balance sum of Rs. 2,50,000/- (Rupees Two lakhs fifty thousand Only) will be paid at the time of execution of sale deed. 4. That the Party No. 1 has represented to Party No 2 that they have no lien, and encumbrances or loans of what so ever nature on the said property. 5. That the party No. 1 have represented to party No. 2 that they have not signed any agreement for sale/Agreements, mortgage dee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 1 as per the MOU was Rs. 5,00,000/-. Therefore, it was for the appellant to establish as to how additional amount of Rs. 10,00,000/- is calculated towards the so called damages/compensation and whether the respondent no. 1 acknowledged that he is liable to pay such amount which include the initial payment of Rs. 5,00,000/- together with additional amount of Rs. 10,00,000/- towards damages and compensation. 21. MOU produced at Exh-8 is totally silent about the eventuality of non-performance of the said agreement and what would be method of refund of the advance paid and whether the appellant would be entitled to claim damages/compensation. Returning back to the complaint filed under Section 138 of the Negotiable Instrument Act, there are no averments or calculations disclosed therein as to how the figure of Rs. 15,00,000/- was arrived at when amount paid by the appellant was only Rs. 5,00,000/-. Averment in paragraph Nos. 12 and 13 of the complaint show that the appellant directed the respondent to return the said amount along with damages/loss caused to him for non-performance of the said agreement. Accordingly, the respondent in due compliance of the said MOU issued a cheque f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y enforceable liability or debt. Thus respondent No. 1 made his defence clear at the time of sending reply i.e. before filing the complaint under Section 138 of Negotiable Instrument Act. In such circumstances, it was incumbent upon the appellant to come up with the appropriate averments in the complaint by showing as to how the amount of Rs. 15,00,000/- is arrived at when the MOU only refers to payment of Rs. 5,00,000/- as advance. The only document which appellant subsequently relied upon is the so called receipt, the contents of which reads thus: "Given to Mr. Tanveer Khatib, a sum of Rs. 15,00,000/- by cheque No. 513842, drawn on Bank of Baroda, Mapusa Branch, towards security deposit against the Agreement for sale of the property (House plot) bearing Survey No. 32, Sub-Division 1 of Colvale Village admeasuring about 700m2, situated at Colvale, Bardez, Goa. In the event that on the stipulated dated being 16-5-09 I am unable to deliver the above said house plot by completing the Deed of Sale, in that case you may deposit the given cheque for recovery of advance paid amount alongwith calculated damages. Sd/- 24. On perusal of contents therein, though figure of Rs. 15,00,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecuted between the parties specifically when such terms and conditions, if any, were modified by the MOU dated 19th November 2009. 27. Respondent No. 1 stepped in the witness box and filed his affidavit-in-evidence in support of his defence. He has been examined at length. Testimony of respondent no. 1 is not at all shaken in the cross-examination except the fact that he was unable to produce clear title to the property which he agreed to sell to the appellant. That apart, evidence of respondent No. 1 clearly goes to show that he received only Rs. 5,00,000/- towards advance for sale of such property. In cross-examination of respondent No. 1/Dw1, no suggestion was put to him that the cheque amount includes damages/compensation to the tune of Rs. 10,00,000/- over and above Rs. 5,00,000/- paid as advance. Even the receipt at Exh.-9 nowhere mentioned that the amount of Rs. 15,00,000/- is legally due to the appellant including damages. Neither the complainant nor any document justify quantifying such damages to the tune of Rs. 10,00,000/-. No prudent man would agree to pay damages/compensation to an amount of Rs. 10,00,000/- for receipt of advance of Rs. 5,00,000/-. At the most such pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of K.N. Beena (supra), the Supreme Court relied upon the case of Hitel Dalal vs. Bratindranath Banerjee (2001) 6 SCC 16 and observed that presumption could be rebutted or discharged by proving contrary. Mere denial or rebuttal in reply to the legal notice is not enough. Applying the same principle to the matter in hand, respondent No. 1 stepped into the witness box and led evidence which is sufficient enough to prove contrary and to rebut the presumption and this again support the case of respondent No. 1. 33. In the case of Tar Mohomad Haji Abdul Rehman, APS Forex Services Pvt. Ltd., Bir Singh and Bharthi Bhanudas Gaonkar (supra), proposition is same that the presumption under Section 139 of the Negotiable Instrument Act is a rebuttable presumption and the accused is entitled to rebut it by showing preponderance of probability either through the material placed by the complainant and his cross-examination and/or by leading evidence to prove contrary. Thus, it is in fact support a case of respondent No. 1 herein. 34. The decision cited by the learned Counsel Ms. Collasso as referred above are also on the same proposition of law which need not to be discussed again and again. Each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt"? Interestingly the learned Magistrate answered this point also in negative though the memo of return of cheque produced at Exh-6 by the appellant from Bank of Baroda, Panaji, shows reason of return of cheque as "opening balance insufficient". Thus, answering this point No. 3 in negative is against evidence on record and therefore needs to be considered as perverse. 41. Point No. 4 reads thus: "Whether the complaint proves that the demand notice was sent within the prescribed period? Surprisingly, this point is also answered in negative. The record shows that the appellant issued legal notice dated 19th February 2011 addressed to respondent No. 1 which is produced at Exhibit-7 (Colly). This notice was sent to two different addresses of the respondent. The acknowledgment card produced at Exhibit-7 (Colly) shows that such notice was received by respondent No. 1 on 21st February 2011. Section 138 of the Negotiable Instrument Act and more specifically clause (b) reads thus: "138 (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, [wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Bank of Baroda on 8th February 2011 3. Demand notice was issued on 19th February 2011 4. Demand notice was received by respondent No. 1 on 21st February 2011 5. The period of 15 days from the date of receipt of demand notice expired on 7th March 2011. 6. The period of one month for filing a complaint expired on 6th April 2011. 7. The complaint was filed before the learned Magistrate on 8th April 2011. 48. Section 142 of the Negotiable Instrument Act reads thus: 142. Cognizance of offences [(1)] Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),-- (a) no court shall take cognizance of any offence punishable under Section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138: [Provided that the cognizance of a complaint may be taken by the court after the prescribed period, if the complainant satisfies the court that he had sufficient cause for not making a complaint within such period.] (c) no court inferior to that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rch 2011. Thus, he was required to file the complaint in writing "within one month from 7th March 2011". Admittedly, the complaint was filed on 8th April 2011 i.e. beyond the period of one month from the date of cause of action. Perusal of record and proceedings show that the complaint was presented on 8th March 2011 and it was registered on the same day. Neither the Registry at the office of learned Magistrate nor the learned Magistrate noticed the above aspect and did not raise any objection at that time. Similarly, the appellant stepped into the witness box by filing an affidavit in verification at exhibit-4 and producing necessary documents. However, the complaint as well as the affidavit-in-verification show that cause of action to file complaint arised on 9th February 2011 as no payment was effected by 8th March 2011. 53. The dates mentioned above clearly show that respondent No. 1 received notice on 21st February 2011 and from that date he was supposed to make payment within 15 days. Thus considering 8 days of February and 7 days of the month of March 2011 which comes to total of 15 days, the said period of 15 days expired on 7th March 2011. Thus cause of action arose on ex ..... 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