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TMI Blog2023 (11) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... nts have been dismissed against conviction but with modification of the sentence. 2. To avoid confusion, parties shall be referred as per their status before Ld. Trial court. 3. Necessary details in the tabulated form are given below: - 4. (i) The facts, in brief, are being extracted from CRR-3456-2019, which is the offshoot of Criminal Complaint No.1105/2015 titled as "Dharam Singh Vs. M/s Pal Infrastructure Pvt. Ltd. and another". It was pleaded by the complainant that on the persuasion of the accused, he invested various amounts from time to time in the company of the accused on the assurance that he would receive Rs.3 lakh after a period of one year over investment amount of Rs.10 lakh and that after lapse of two years, he (Complainant) will be entitled to receive Rs.10 lakh besides Rs.3 lakh as assured return. As per the complainant, he invested total amount of Rs.1,40,00,000/- on different dates, out of which Rs.1,09,35,000/- was paid through different cheques as per the details given in para-No.2 of the complaint and rest of the amount was paid in cash. On completion of one year, complainant received some of the amount and after completion of the time period of the scheme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduction warrant of the accused Harpal Singh was issued, as said accused was in custody in some other case. Accused was produced before the Court on 23.12.2015 and was allowed bail. Notice of accusation was served upon the accused under Section 138 of the NI Act on 25.01.2016, to which he pleaded not guilty and claimed trial. 6. Complainant examined himself as CW1 and relied upon documents Ex.C1 to C to C14, supporting the complaint version. Complainant further examined Dwarkesh Muchhal, Assistant Manager, Indian Bank, Sushant Lok Branch, Ph-I, Gurgaon, as CW2, who proved documents Ex.CW2/1 to Ex.CW2/6. 7. After closure of evidence by the complainant, statement of the accused under Section 313 CrPC was recorded, confronting him with all the incriminating circumstances appearing against him. The accused did not dispute either his signature or the issuance of cheque, but stated that the cheque was given as a security, which has been misused by the complainant by filing this complaint. Accused pleaded further that he is in judicial custody since March 2015 and that his account was freezed by the Court vide order dated 10.03.2015 (CW2/3), regarding which intimation was also sent to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailable on record in right prospective. It was ignored that at the time of presentation of the cheque, the bank account of the petitioner was already freezed by the order of the Court, although the cheque was returned with remarks as 'funds insufficient'. Ld. counsel contends that in other cases, remarks have been given by the same bank either as 'attachment order/Court order'. It is urged that since the account of the petitioner was already freezed at the time of presentation of the cheque, so basic ingredients of Section 138 of the NI Act are not made out. (ii) Ld. counsel contended further that the principle of 'payment stopped' or 'payment blocked' or 'account closed' could not have been applied in this case, because the petitioner was not in control of his account and so, he was not in a position to maintain the account. Ld. counsel has relied upon a decision of this Court rendered in Rajesh Meena Vs. State of Haryana and others, 2020(3) RCR (Criminal) 888; and Vijay Chaudhary Vs. Gyan Chand Jain, 2008(4) RCR (Criminal) 159. (iii) Ld. counsel further contends that petitioner was in judicial custody since 11.04.2015, so there could be no question of serving of legal notice da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is urged that in fact, when all these cheques were presented, there was no sufficient funds in the account of the accused-petitioner as will be evident from the statement of Bank account Ex.CW2/4. (iii) By referring a decision of Himachal Pradesh High Court in Nexus Health & Beauty Care Private Limited & another Vs. National Electrical Office" 2012(18) RCR (Criminal) 793, it is contended that even if a cheque has been dishonoured due to payment stopped by attachment order/Court order, still there is presumption under Section 139 of the NI Act, which of course can be rebutted by the accused by producing the defence that he had sufficient funds in his account at the time of attachment order of the Court and that burden in this regard is upon the accused. It is urged that in this case, accused has not led any evidence that at the time when the account of the accused was freezed by any order, he had sufficient amount in his account or had any arrangement with his banker. (iv) Ld. counsel for respondent - complainant has further contended that second situation of 'payment stopped by drawer' has been dealt with by Hon'ble Supreme Court in M.M.T.C. Ltd. and another Vs. Medchl Chemicals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Singh to the accused demanding payment of the cheque amount within 15 days from the date of receipt of the notice. Ex.C12 to C14 are the copies of postal receipts to show that legal notice was sent through registered post. All these documents are proved by the testimony of CW1 Dharam Singh complainant. 15. During his cross-examination, it has been disclosed by CW1 Dharam Singh-complainant that he had also lodged FIR against the accused raising allegation of cheating. He also disclosed that 7 of the cheques were given to him in January 2015 and 3 in February 2015. He specifically deposed that all the cheques were issued and filled by accused himself in his own handwriting and that he (complainant) did not fill even a single particular in any of the cheques on his own or with the help of another person. CW1 Dharam Singh-complainant pleaded ignorance as to whether the account of the accused was seized by any Court order. 16. CW2 Dwarkesh Muchhal, Assistant Manager, Indian Bank, Sushant Lok Branch, Ph-I, Gurgaon proved a notice dated 10.02.2015 issued by Police Station, DLF, Phase I, Gurgaon, whereby the Banker of the accused i.e., Indian Bank was asked to handover the account state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very negotiable instrument bearing a date was made or drawn on such date;" 19. In Goa Plast (P) Ltd. Vs. Chico Ursula D'souza & Anr 2003 (3) SCC 232, Hon'ble Supreme Court has held that the provisions of Section 138 to 142 of the N.I. Act, is for the purpose of giving credibility to negotiable instruments in business transactions. In view of section 139 of the NI Act, it has to be presumed that a cheque is always issued in discharge of any debt or other liability. The presumption could be rebutted by adducing evidence and the burden of proof is on the person who wants to rebut the presumption. 20. In Rangappa vs. Sri Mohan, 2010 (11) SCC 441, a three judges' bench of the Hon'ble Supreme Court held that Section 139 of the NI Act includes the presumption regarding the existence of a legally enforceable debt or liability and that the holder of a cheque is also presumed to have received the same in discharge of such debt or liability. It was clarified in the aforesaid decision that the presumption of the existence of a legally enforceable debt or liability is, of course, rebuttable and it is open to the accused to raise a defence, wherein the existence of a legally enforceable debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to the circumstances upon which they rely. That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden. * It is not necessary for the accused to come in the witness box to support his defence. 23. It is in the light of the aforesaid legal position that it is required to be seen that whether accused has been able to probabilise his defence. Here itself, it may be noted that the accused is not required to prove his defence on the standard of proof 'beyond reasonable doubt' and rather, he is simply required to probabilise his defence. The presumption under Section 139 of the Act can be rebutted even by evidence led by the complainant; and it is not required for the defence to lead evidence to rebut presumption, as has been held in Pawan Kumar Vs. Sunil Kumar 2020 (1) CCC 391 by this court and also by the Hon'ble Supreme Court in Shiv Kumar Vs. Ram Avtar Aggarwal, 2020(2) RCR (Crl.) 147. 24. Three submissions made by the petitioner are: (i) his accounts were already seized, when the cheques were presented for encashment; (ii) non-receipt of the legal notice; and (iii) misuse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t account cheque should be drawn. This would be clear by reading the Section along with provisos (a), (b) & (c)." 27. In the above case before Hon'ble Supreme Court, proceedings were challenged on the ground of maintainability of complaint, as the cheque was dishonoured because account stood closed. Hon'ble Supreme Court held that the provisions of Section 138 NI Act cannot be interpreted narrowly because if argument of the drawer is accepted, it would defeat the legislative intent. 29. The situation, when the cheque in question was dishonoured due to 'stop the payment' by drawer, would be punishable under Section 138 NI Act was considered by the Hon'ble Supreme Court, in M.M.T.C Ltd. and Anr Vs. Medchl Chemicals and Pharma (P) Ltd. and Anr, 2001 (1) SCC 234, wherein it was held as under: - "It has been held that even though the cheque is dishonoured by reason of 'stop payment' instruction an offence under Section 138 could still be made out. It is held that the presumption under Section 139 is attracted in such a case also. The authority shows that even when the cheuqe is dishonoured by reason of stop payment instructions by virtue of Section 139 the Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ituation continue. Therefore, the said expression "account maintained by him" cannot be construed narrowly to mean that if the account belongs to the accused, the necessary ingredient would be complete. This expression "account maintained by him" must necessarily include that the said account is not only alive and operative, but the account holder is capable of executing command to govern the financial transactions which include the clearance of cheques etc. The authority and control of the account holder upon the account must exist on the effective date i.e., when the cheque becomes valid for presentation in the bank. It is settled law that mere issuance of a cheque is not an offence, but it becomes punishable when the said cheque is dishonoured. Mere fact that the record of the drawer bank shows a particular name as account holder would not be sufficient to establish that account is being maintained by the account holder, unless the said account holder holds the authority and control over the said account. In other words, if an account holder is deprived off his authority, control and dominion over the bank account, it cannot be said that the account is being maintained by the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se his right either to deposit into or with draw from the said account. Even if it were to be assumed for the sake of argument, that the cheque was in fact issued in discharge of the petitioner's liability owed to the respondent, and that at the time of issuance of the cheque, he did not have sufficient balance in the account, or an arrangement with his banker, in case the bank account had not been attached under the orders of a Court, nothing prevented the petitioner from either depositing money in his account or entering into an agreement with his bank to arrange for sufficient funds in the account, to be able to honour the cheque in question by the date when the said cheque could have been presented for payment at the earliest. This is so because there was sufficient time gap i.e. of nearly one year and eight months between the date of alleged issue of cheque and the date of its presentation. As held by the Hon'ble Supreme Court in Modi Cements (supra), the issuance of the cheque without having sufficient balance in the account of the drawer does not by itself tantamount to the commission of an offence under section 138 of the Act. However, in the facts of this case, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y been noticed that as per the bank account statement Ex.CW2/6 for the period 01.01.2013 to 27.03.2016, petitioner did not have the amount in his account so as to honour the cheque in question at any point of time, either before seizure of the account by the Court/police or thereafter. Further the cheques were handed over in January/February 2016 only and the account was seized in March 2015. Neither at the time of handing over the cheques nor at the time of seizure nor at the time when the payments became due under the cheque, the petitioner had the sufficient amount in his account. It is not the defence of the petitioner that he wanted to make arrangement with his bank so as to honour the cheques. 37. At this stage, it will also be relevant to refer to certain observations made by Hon'ble Supreme Court in D. Vinod Shivrappa Vs. Nanda Beelliappa, 2006 (3) RCR (Criminal) 145, while interpreting proviso to Section 138 of the NI Act. The observation read as under: - "13. Section 138 of the Act was enacted to punish those unscrupulous persons who purported to discharge their liability by issuing cheques without really intending to do so, which was demonstrated by the fact that ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract clearly shows that Hon'ble Supreme Court consciously used the words "which was demonstrated by the fact that there was no sufficient balance in the account to discharge their liability". This observation of the Hon'ble Supreme Court is sufficient to show that whatever be the reason for dishonour of the cheque, it has to be correlated with the insufficiency of funds in the account or to the lack of the arrangement made by the drawer with his bank under an agreement. Accused cannot be allowed to plead that had his account been not seized, he could have deposited the amount or that he could have made necessary arrangement with the banker. What is necessary to take note is that at the time when the account was seized or when the cheque was presented, there was no sufficient fund in the account of the accused. 39. Here, it will also be useful to refer to the observations made by Hon'ble Supreme Court in Pankaj Mehra And Anr. vs State Of Maharashtra 2000 Crl.L.J 1781 (SC). Their lordship held as under: "The last factor for constituting the offence under Section 138 of the NI Act is formulated in clause c of the proviso to the Section which reads thus : "the drawer of such cheque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in such case also because Section 140 of the NI Act excludes the defence that accused had no reason to believe that cheque would be dishonoured for reasons stated in Section 138 of the Act. 42. Section 140 of the Act reads as under: - 40. Defence which may not be allowed in any prosecution under section 138. -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. 43. Thus, plain language of Section 140 of NI Act would clearly reveal that a drawer of the cheque cannot be allowed to take the plea as a defence in prosecution for an offence under Section 138 of the Act that he did not have any reason to believe when he issued the cheque that it may be dishonoured on presentation. It has already been noticed that in present case, neither at the time when the cheques were handed over to the complainant nor at the time when the account of the accused was seized by the Court nor at the time of presentation, there was sufficient funds in the account of the petitioner and therefore, under the garb of the order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom legal consequences of Section 138 of the Act." 46. Hon'ble Supreme Court further held as under: "In the instant case, the averment made in the complaint in this regard is: Though the complainant issued lawyer's notice intimating the dishonour of cheque and demanded payment on 4.8.2001, the same was returned on 10.8.2001 saying that the accused was out of station. True, there was no averment to the effect that the notice was sent at the correct address of the drawer of the cheque by registered post acknowledgement due. But the returned envelope was annexed to the complaint and it thus, formed a part of the complaint which showed that the notice was sent by registered post acknowledgement due to the correct address and was returned with an endorsement that the addressee was abroad. We are of the view that on facts in hand the requirements of Section 138 of the Act had been sufficiently complied with and the decision of the High Court does not call for interference." 47. In present case, as per trial court record, the accused was produced in the Court of ld. JMIC, Gurgaon for the first time on 23.12.2015 pursuant to the production warrants issued for him. There is nothing on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also not acceptable. There can be no doubt regarding the fact that the security cheque is an integral part of the commercial process entered into between the Petitioner and Respondent/Complainant. The security cheque is not only a deterrent for the drawer against dishonoring his financial commitment but can also be legally and validly utilized towards the discharging of the liability of the Drawer. It cannot by any stretch be argued that a security cheque is not handed over or issued in pursuance of any undischarged liability. To hold so would defeat the whole purpose of a security cheque. In the considered opinion of the Court, a security cheque is an acknowledgment of liability on the part of the drawer that the cheque holder may use the security cheque as an alternate mode of discharging his/its liability. Thus, the argument of the learned counsel for the petitioner that on dishonouring of a security cheque no offence punishable under section 138 of the Negotiable Instruments Act is made out." 51. No other point was raised. 52. Consequent to entire discussion as above, this court finds no merit in any of these revisions. Same are dismissed. Pending application(s), if any, a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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