Bombay High Court
Pune. vs M/S. Tooltek Special Machines on 14 October, 2013
Bench: A.H. Joshi
sbw 1/12 appln.159.12
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPLICATION NO.159 OF 2012
M/s. V. A. Enterprises )
Having its office at Plot )
No.3rd floor, Flat No.15/A )
Ronak Residency, Survey No.224 )
Near Choinchwad Station )
Pune. )
Through its proprietor )
Mr. Ashok Pundalik Suryavanshi )
Age 41 years, Occ:Business )
Address as above. ) ...Applicant
vs.
1. M/s. Tooltek Special Machines)
Having its office at Plot )
No.7/2, Siddhivinayak )
Industrial Estate, Kudalwadi )
Pune. )
2. Mr. Bashir Hamidknhan Inamdar)
Proprietor of M/s. Tooltek )
Special Machines, Plot No.7/2)
Siddhivinayak Industrial )
Estate, Kudalwadi, Pune. )
3. The State of Maharashtra ) ...Respondents
Mr. Vaibhav A. Sugdare for the Applicant.
Ms. A. A. Mane, APP, for the Respondent - State.
CORAM : A. H. JOSHI, J.
DATE : 14th October, 2013
J U D G M E N T
1] By the present application, the applicant seeks leave
to file appeal, taking exception to the impugned judgment and
order dated 30.11.2011 passed by the Ld. 4 th Judicial
Magistrate, First Class, Pimpri, Pune, whereby the learned
sbw 2/12 appln.159.12
Magistrate has dismissed the complaint filed by the applicant
under Section 138 of the Negotiable Instruments Act.
2] Applicant's case is summarized as follows:-
(a) Applicant had supplied certain goods on oral
orders to the respondent, on credit limit of 60
days. The respondent used to acknowledge the
delivery of material by signing delivery challans.
(b) The dues towards supplies and invoices had
accumulated to the tune of Rs.3,10,540/-. Out of
the said
ig amount, the respondent made a part
payment of Rs.59,000/- and assured the applicant
to pay the balance in due course of time.
(c) Two cheques bearing cheques No.295879 and
295880 for an amount of Rs.1,00,000/- drawn on
Karad Urban Co-operative Bank Ltd., Bhosari
Branch, Pune were issued by the Respondent towards
the payment of dues. Both aforesaid cheques were
dishonoured and returned with remark "funds
insufficient".
(d) Applicant issued notice as regards dishonour,
which was served, however the accused did not pay.
Therefore the applicant filed Criminal Complaint
No.6169 of 2007 in the Court of Judicial
Magistrate First Class, Pimpri, Pune.
3] Applicant filed affidavit of examination in chief and
thereby tendered the proof of facts as regards transactions,
the dishonour of cheques and notice etc. The applicant's
defence as suggested in the cross examination was that the
sbw 3/12 appln.159.12
cheques were issued by way of security. Said suggestion was
denied by the applicant.
4] Respondent No.2 examined himself. He was cross
examined by the advocate for the applicant. In the cross
examination, respondent No.2 accepted the business
transaction and supply of material till the year 2004. He
also accepted the transaction and the signature on the
cheques.
5]
The learned Magistrate considered the complaint and
the evidence of the parties, and acquitted respondent No.1
and 2, holding that the complainant had failed to prove that
cheques were issued towards legally enforceable debt, it
being a debt barred by law of limitation.
6] According to the applicant, the learned Magistrate
had failed to:-
(a) Correctly apply the principle and
interpretation of provision under Section 118(a)
and Section 139 of the Negotiable Instruments
Act, as regards the presumption of consideration
consideration in favour of the holder of a
cheque;
(b) Appreciate the provision of Section 18 of
the Limitation Act and erred in arriving at a
conclusion that though the debt was barred by
the Limitation Act, the same was payable when
the debtor issues a cheque;
sbw 4/12 appln.159.12
(c) Appreciate that the respondent No.2 had
failed to destroy the presumption of
consideration as established under Section
118(a) and as to the aspect of the consideration
and the fact that the cheques which were issued
were not towards any debt due to the applicant;
(d) Appreciate that the fact of issuance of
cheques dated 1.6.2007 which have been
dishonoured, is a promise made in writing, and
signed by person contemplated under sub-section
3 of Section 25 of the Indian Contract Act, 1872
and
ig therefore the same
acknowledgment, there by, it revives debt, and
amounts to
activates fresh spell of limitation.
7] Learned advocate for the applicant has placed reliance
on the reported judgment of this Court in Dinesh B. Chokshi
V/s. Rahul Vasudeo Bhatt 2013 (2) Mh. L.J. Page 130. Relying
on this judgment, it is urged that:
A cheque issued for payment of a time barred debt
would constitute a promise to pay a time barred
debt and hence therefore issuance of such cheque
would comprehend existing and legally enforceable
civil liability.
8] Now this Court has to see on facts as to whether the
act of issuance of a cheque which complainant claims that it
was issued towards a debt barred by law of limitation, did
the act of issue of cheque, ipso facto, constitute a promise
to pay "a debt which was barred by limitation.
sbw 5/12 appln.159.12
9] On facts of the case on hand, it is seen that the
complainant did not begin and proceeded with a positive
factual plea, that based on facts within common knowledge and
understanding of both parties, the cheques subject matter
were issued towards payment of money which was a debt barred
by limitation.
10] Text of notice issued by applicant as regards the
mode and reasons of issue of cheque read thus:-
"4. My client submits that you avoided to pay the
outstanding bill amount to my client and hence my
client requested you personally and on telephone
discussions to pay outstanding at the earliest.
Thereafter you issued under described cheques
after tremendous follow up by my client to repay
the outstanding bill:
Cheque No. Date Amount Name of Bank
295880 01/06/07 1,00,000/- The Karad Urban
Co-op. Bank Ltd.
Bhosari Branch Pune.
295879 01/06/07 1,00,000/- The Karad Urban
Co-op. Bank Ltd.
Bhosari Branch Pune.
(Herein after referred as "The said Cheque" for
the sake of brevity).
My client submits that you assured and promised my
client that the said 2 cheques will be honoured on
presentation and assured to pay balance amount
shortly."
(quoted from page 21 paragraph No.4 of paper book).
sbw 6/12 appln.159.12
11] The version contained in paragraph No.5 of complaint
is verbatim the same as stated in the notice as is quoted in
the foregoing paragraph. It is also evident from the
paragraph number 5 of the examination in chief on affidavit
at page No.24 of the paper book, that the same plea is
replicated.
12] It is seen from records that it was argued/urged
before trial Court that:-
(a) Cheques were issued towards dues found at
the foot of open and
ig current account
towards goods supplied.
(b) Reliance was placed during oral arguments
before trial Court on Section 18 of
Limitation Act, thereby meaning that plea
that a promise to pay debt barred by
limitation was never either fact of
matter or plea of the complainant.
13] On facts of the case on hand, it is seen from the
evidence on record and impugned judgment that:-
(a) Liability was not based on actual and
admitted fact of delivery goods.
(b) Delivery of goods too was not proved.
(c) Case was sought to be proved solely on
statement on oath.
14] It is also seen that it was not the complainant's
case that :-
(a) Admittedly parties were acting on a
foundation that there existed a debt
sbw 7/12 appln.159.12
barred by law of limitation.
(b) The cheques were issued by the accused
knowing fully well based solely on moral
consideration to pay debt which is
otherwise barred by law of limitation.
15] It emerges that the story that the cheques were
issued for payment of a debt which was barred by limitation
is crafted post facto, the judgment of acquittal. This is an
art work created only after reading the judgment in case of
Dinesh (supra) or based on independent genius, but denovo. It
is thus vivid that the story that the cheques were issued
towards time barred debt is a find of legal talent.
16] This Court has also to keep in mind that statute
allows law the drawee to set up a plea that the cheque
subject matter is issued for payment of a debt which is
barred by law of limitation, but does not excuse him from
obligation/burden of proving a promise as pleaded or relied.
17] Similarly a plea to deny and defeat the drawee's plea
that there did not exist any such promise by and on the part
of accused, too is not barred enacted law or law of
precedent.
18] There does not exist any room to debate that it is a
settled legal position, that a promise to pay debt which is
antecedent and a time barred debt, constitutes a good and
sbw 8/12 appln.159.12
lawful consideration for a promise to pay it. This legal
position is based on moral consideration and such promise is
not illegal nor is not opposed to policy of state.
Recognition of a promise to pay a time barred debt by law is
based on strong morals and good order of life, which is based
on high ethical values as foundation of life.
19] It is very well recognized that bar of limitation
perishes the remedy but not the right. This principle is
based on ethical principles that a debt does not extinguish
and facts of a
ig case may stop operation of the clock of
limitation fixed by law, and even for this stoppage of clock,
the law provides that reckoning certain durations while
counting limitation certain spells can be excluded.
20] It is seen that the judgment in case of Dinesh B.
Chokshi (supra) does not lay down that a defence or defences
such as the debt being barred by law and that no such promise
exist cannot be taken.
21] The case of Dinesh B. Chokshi (supra) is a precedent
on the law that a debt for which a suit is barred by
limitation is a good consideration and a cheque issued for
payment of such debt is a cheque towards liability which is
legally enforceable.
22] Therefore after considering the judgment in case of
sbw 9/12 appln.159.12
Dinesh Chokshi (supra) this Court has to proceed on
assumption that law as it stands has to be read only as:-
(a) It is open to a complainant to prove that
the accused had promised to pay a time barred
debt.
(b) The cheque so issued when proved can be used
as a piece of evidence to show that it was act
of performance of said promise to pay the debt
for which suit is barred due to limitation.
(c) Fact of issue of a cheque which drawee
claims to be issued for payment of a debt barred
by law of limitation does not have a backing
due to any statute law by a presumption of
"shall presume" or "conclusive proof" as to
existence of a fact that, ipso facto, due to
issuance of a cheque where the debt is
ostensibly barred by law of limitation, is
created.
(d) Thus the fact of issuance of cheque is the
last act in the series of events such as after
which becomes a promise when accepted, as its
performance, towards payment of a debt barred by
limitation.
(e) Whenever a cheque is proved to be issued by
a drawer knowing fully well that the cheque is
issued for discharge of civil liability which is
barred by law of limitation, such cheque would
not only constitute a promise to pay a sum
assured therein but would also constitute proof
of fact as an act performance of a promise to
pay a time barred debt.
sbw 10/12 appln.159.12
23] Every complainant owes an obligation and a burden in
law to prove before the Court that the accused know that the
debt subject matter was barred by law and the accused has
made a promise to pay said time barred debt.
24] Proof of facts by leading evidence is the bounden
duty of a litigant. He can claim exception from duty to
begin or duty to prove. Duty to prove can be escaped if any
rigid presumption of the category of "shall resume" governs
the matter of
ig existence of fact and creates a bounden
obligation on a Court to proceed on supposition of existence
of a fact.
25] Learned advocate for the applicant is not able to
show that whenever payee of a cheque claims that issuance of
a cheque was done by drawer for payment of or towards payment
of time barred debt, it would mean that according to the
drawee there exists a promise to pay a time barred debt and
issuance of cheque is performance of said promise.
26] The law as enacted and as laid down by precedents
does not lay down that act of a debtor in issuance of a
cheque which the holder/payee claims that it was issued/drawn
for payment of a time barred debt, carries a presumption to
that effect, and a defence to th contrary is barred.
sbw 11/12 appln.159.12
27] A promise to pay a time barred debt whether oral or
written, is a question of fact, unless admitted by accused
such "promise" needs to be proved being a fact in issue
involved in the case like any other jurisdictional fact or an
ingredient.
28] It is seen that in any form law as enacted or due to
precedent, has not created any bar as regards the plea
wherein an accused can deny or take any defence in any form
against such a cheque purportedly or ostensibly for a debt
for which suit it barred.
29] All that can be regarded as settled law is that
whenever a cheque is issued "for payment of time barred
debt", said debt answers the description of the term
existence of "legally enforceable liability" hence
presumption as to consideration being legal exists, but no
presumption exists or is created that the fact of issuance of
cheque would ipso fact prove existence of promise, as a
presumption of class "shall presume".
30] This Court has to be mindful to the basic fact as to
what a cheque is. Issuance of a cheque is an "order" by
drawer to his banker to "pay". It may be backed by a
promise to pay a debt barred by law of limitation, but
itself it is not a promise to pay a debt barred by
limitation, at least a fact bound to be presumed in the class
sbw 12/12 appln.159.12
of presumption of "shall presume" as provided in the Evidence
Act.
31] In present case cheque subject matter may at the most
be the evidence of part performance of promise, and not a
promise in itself. Issuance of cheque can be shown by the
drawee to be an act constituting evidence of performance the
oral or written promise to pay a debt barred by law of
limitation.
32]
The result is that the story of cheques being issued
to pay a debt barred by limitation is all based on figment
than fact of the matter.
33] The application has no merit and deserves dismissal
and is dismissed.
wadhwa ( A. H. JOSHI, J.)
