S.Krishan Sharma vs M/S. Hada Developers Pvt. Ltd
2011 Latest Caselaw 3480 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
                       Judgment reserved on: July 11, 2011
                       Judgment delivered on: July 22, 2011

+      CRL.M.C. NO. 1560/2010 & CRL.M.A.17347/2010

       S. KRISHAN SHARMA                       ....PETITIONER
                Through: Mr.Rajesh Manchanda, Advocate with Mr.
                         Rajat Manchanda, Advocate.

                       Versus

       M/S. HADA DEVELOPERS PVT. LTD.               ....RESPONDENT
               Through: Nemo.

        CORAM:
        HON'BLE MR. JUSTICE AJIT BHARIHOKE

1.     Whether Reporters of local papers
       may be allowed to see the judgment?

2.     To be referred to the Reporter or not ?
3.     Whether the judgment should be
       reported in Digest ?


AJIT BHARIHOKE, J.

1. S. Krishan Sharma, the petitioner herein vide this petition

under Section 482 CrPC is seeking quashing of proceedings of

Complaint Case No. 4353/2008 in complaint titled as M/s. Hada

Developers Pvt. Ltd. Vs. S. Krishan Sharma, pending in the court of

Metropolitan Magistrate, Dwarka, New Delhi.

2. Briefly stated, facts relevant for disposal of this petition are

that respondent M/s. Hada Developers Pvt. Ltd. filed a complaint

under Section 138 read with Section 142 of N.I.Act and Section 420

IPC against the petitioner claiming that in June, 2004, the petitioner

along with M/s. 3rd Dimension of Architecture Pvt. Ltd. and Mr. Nitin

Sharma approached the respondent/complainant in June, 2004 for a

short term loan of ` 6 lakhs, which was sanctioned and disbursed as

per the terms and conditions detailed in loan agreement dated 17 th

June, 2004, which was signed by the petitioner, Nitin Sharma and

the respondent/complainant. The amount of loan was to be repaid

along with 20% interest per annum in 18 monthly instalments of `

43,333/- from June, 2004 to November, 2005. It is claimed in the

complaint that in order to discharge the aforesaid legally

enforceable debt, the petitioner/accused issued a cheque bearing

No. 962976 dated 15th December, 2005 for ` 7,80,000/- drawn on

Punjab National Bank, Sheikh Sarai, New Delhi. The cheque, when

presented to the drawee bank through the complainant's bank, was

returned back dishonoured with the remarks "Funds Insufficient".

Respondent served the petitioner with requisite demand notice

under Section 138, N.I.Act, calling upon him to pay the cheque

amount. The petitioner, however, failed to comply with the demand

notice. This led to filing of the complaint under Section 138, N.I.Act

& Section 420 IPC.

3. Learned Metropolitan Magistrate, after the preliminary enquiry,

summoned the petitioner to undergo trial for the offence punishable

under Section 138 N.I.Act. The petitioner was served with the notice

under Section 251 CrPC to which, he pleaded not guilty.

4. In order to bring home the guilt of the petitioner, respondent

has examined CW1 S.K.Bahri, Authorized Representative of

respondent/complainant company.

5. Learned Sh. Rajesh Manchanda, Advocate appearing for the

petitioner submits that the complaint qua him is liable to be

quashed for the reason that he only stood guarantee for repayment

of loan advanced to M/s. 3rd Dimension of Architecture Pvt. Ltd. and

admittedly, the cheque in question was issued as a security for the

aforesaid loan. Expanding on the argument, learned counsel for the

petitioner has drawn my attention to the copy of the statement of

CW1 S.K.Bahri, Authorized Representative of the complainant

company, particularly, his cross examination wherein he has, inter

alia, stated thus:

"Since the accused is a guaranteer of the loan provided to M/s. Third Dimension Architecture Pvt. Ltd. and was also a director in the same, accused is legally liable to pay the cheque amount..... ...........

...........

It is correct to suggest that the cheque was given as a security by the accused for timely repayment of borrowed loan by the company".

Learned counsel submits that from the aforesaid, it is apparent that

the cheque in question was given as a security for the loan for which

the petitioner stood guarantee, as such, it cannot be said that it was

against the existing debt. Accordingly, Section 138, N.I.Act is not

attracted. In support of his contention, petitioner has relied upon

the judgment of Supreme Court in M.S.Narayana Menon @ Mani

Vs. State of Kerala and Anr., AIR 2006 SC 3366.

6. I have considered the submissions made on behalf of the

petitioner and perused the record. From the application, being

Crl.M.A. 6180/2010, filed along with the petition of the petitioner, it

is apparent that when the application was moved on 06 th May, 2010,

the trial of the complaint case was at the stage of recording of

statement of the accused. Thus, it is obvious that the trial is almost

at its conclusion. The petitioner is seeking quashing of the

complaint mainly on the ground that the cheque in question was

given by him to the respondent as security and in this regard, he is

relying upon the cross-examination of CW1 S.K.Bahri, A.R. of the

complainant, who admitted the suggestion that the cheque in

question was given as a security for timely repayment of loan by the

company. The above noted excerpt of statement of CW1 S.K.Bahri

cannot be read in isolation. It has to be read in the context of other

evidence, including the affidavit of the witness tendered in

evidence, copy of which is not placed on record. Entire evidence led

by the petitioner has to be analyzed to come to a conclusion about

the guilt of the accused. Otherwise also, Section 139, N.I.Act raises

a presumption in favour of holder of the cheque, which provides that

unless the contrary is proved, it shall be presumed that the holder of

the cheque received the cheque of the nature referred to in Section

138 for discharge, in whole or in part, of any debt or other liability.

This presumption, however, is rebuttable but the onus to rebut the

presumption is on the accused. Admittedly, evidence of the

accused is yet to be recorded. Therefore, at this stage, it would be

premature to analyse the evidence and quash the proceedings of

the complaint only on the basis of one line admission of a

suggestion by CW1 S.K.Bahri. The judgment relied upon by the

petitioner is not applicable to this case, because it is yet a question

of fact to be determined, whether the cheque in question was given

as security and not against the existing debt.

7. In view of the discussion above, taking into account that the

trial of the complaint is almost at the fag-end, I am not inclined to

invoke inherent power under Section 482 CrPC to quash the

proceedings of the complaint.

8. Petition is accordingly dismissed.

(AJIT BHARIHOKE) JUDGE

JULY 22, 2011 akb