Delhi High Court
Vikal Business Corporation vs Bishan Das & Anr on 12 March, 2013
Author: G.P. Mittal
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 12th March, 2013
+ CRL.L.P. 319/2012
VIKAL BUSINESS CORPORATION ..... Petitioner
Through: Ms. Geeta Mehrotra, Adv.
versus
BISHAN DAS & ANR ..... Respondent
Through: Mr. Parminder Singh Goindi, Adv.
along with Respondent in person.
+ CRL.L.P. 320/2012
VIKAL BUSINESS CORPORATION ..... Petitioner
Through: Ms. Geeta Mehrotra, Adv.
versus
BISHAN DAS & ANR ..... Respondent
Through: Mr. Parminder Singh Goindi, Adv.
along with Respondent in person.
+ CRL.L.P. 321/2012
VIKAL BUSINESS CORPORATION ..... Petitioner
Through: Ms. Geeta Mehrotra, Adv.
versus
BISHAN DAS & ANR ..... Respondent
Through: Mr. Parminder Singh Goindi, Adv.
along with Respondent in person.
Crl M.C. Nos.319/2012, 320/2012, 321/2012 & 322/2012. Page 1 of 11
+ CRL.L.P. 322/2012
VIKAL BUSINESS CORPORATION ..... Petitioner
Through: Ms. Geeta Mehrotra, Adv.
versus
BISHAN DAS & ANR ..... Respondent
Through: Mr. Parminder Singh Goindi, Adv.
along with Respondent in person.
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
JUDGMENT
G. P. MITTAL, J. (ORAL)
1. These four Leave Petitions arise out of the four separate judgments of
even date 20.03.2012 passed by the learned Metropolitan Magistrate
(„MM‟) in four complaint cases under Section 138 of Negotiable
Instructions Act, 1881(the Act) whereby Respondent No.1 was acquitted
for having issued four cheques No.508824 dated 19.04.2008 for `5,013/-,
Cheque No.508822 dated 17.04.2008 for `11,083/-, Cheque No.508821
dated 19.04.2008 for `18,276/- and Cheque No.508825 dated 16.04.2008
for `14,763/- all drawn on Canara Bank, Bhogal, New Delhi, which were
dishonoured on presentation on account of insufficient funds and the
Respondents allegedly failed to make the payment within the statutory
period even inspite of notice under Section 138 of the Act.
2. As per the averments made in the Complaints the abovesaid four cheques
were issued by Respondents No.1 and 2 in favour of the Petitioner Vikal
Business Corporation towards the amount due from them. The cheques
were presented to Allahabad Bank, Nehru Place Branch of the Petitioner.
The same were returned unpaid with the written memo dated 21.04.2008
by Canara Bank, Bhogal with the reason "Funds Insufficient".
3. The Respondents pleaded not guilty to the notice issued under Section
251 of the Code of Criminal Procedure, 1973 („the Code‟). The Petitioner
examined Vaibhav Kalra, its Authorized Representative to prove various
documents. On appreciation of evidence, the learned „MM‟ found that
the Petitioner had failed to prove that the cheques were issued in
discharge of any part or whole of the liability of the drawer. Thus, the
Respondents were acquitted of the offence punishable under Section 138
of the Negotiable Instruments Act, 1881 (the Act). In paras 12 to 21 of
the impugned judgment which are same in all the four complaint cases
(except the amount of the cheque), the learned MM had given the detailed
reasons for acquitting the Respondents for the offence punishable under
Section 138 of the Act. The same are extracted hereunder:
"12. It is the case of the complainant that the accused issued the
impugned cheque to the complainant to discharge his liability
towards the sum due. The cheque got dishonored on presentation.
The complainant got a legal demand notice served upon the
accused but the accused failed to make payment of cheque amount
despite service of legal demand notice and hence, this complaint.
13. The complainant through his complaint, affidavit, the
dishonored cheque, returned memo and legal demand notice has
created a factual basis to raise dual presumptions under Section
139 of the Act i.e. issuance of cheque for legally enforceable
liability in whole or in part or any other liability and of the
existence of legally enforceable debt/liability as such.
14. To the case of the complainant, it is the defence of the
accused, First that, the impugned cheque was issued to the
complainant as advance payment for purchase of paper which was
never supplied to him and Second, that the impugned cheque was
not issued to discharge any liability of the accused firm and
therefore, offence u/s 138 of the Act is not made out against him.
15. To establish his innocence and rebut the presumptions against
him, accused duly cross examined the complainant. CW1 in his
cross examination denied the suggestion that the impugned cheque
was issued as advance payment towards supply of papers to
accused which were not supplied. CW1 admitted that the
complainant did not raise any invoice/bills against the accused
firm i.e. Apex Printers, on whose account the impugned cheque is
drawn.
It is the argument of the defence counsel that there are stark
contradictions in the case of the complainant as averred in the
complaint and as testified in the cross examination of CW1.
16. At this stage, the case of the complainant regarding the
liability of accused as averred in the complaint is required to be
reproduced. Para 2 of the complaint is reproduced below:
"that the accused issued a cheque no. 508824 dated
19.04.2008 for Rs.5,013/drawn on Canara Bank, Bhogal,
New Delhi, in favour of the complainant, Vikal Business
Corporation towards the amount due from them."
It is the case of the complainant as per complaint that the
impugned cheque was issued by accused for discharge of legal
liability of his own firm i.e. M/s Apex Printers and Stationers.
Contrary to this averment, CW1 in his cross examination testified
that complainant did not raise any bills/invoices against the
accused firm i.e. Apex Printers. A relevant portion of the cross
examination is pertinent to be reproduced for better appreciation
of the argument of the defence counsel. The relevant portion is as
follows:
"The complainant was in business dealings with M/s Apex
Arts, 28 Bhogal Road, New Delhi and not with Apex
Printers and Stationers. Complainant did not raise
bills/invoices against Apex Printers. Voluntarily accused
always issued cheques in the name of Apex Printers and
Stationers but his firm Apex Arts used to be in business
dealings with us."
17. Perusal of the aforesaid excerpt of the testimony of CW1
manifestly reveals that complainant admittedly did not have any
business dealings with the accused firm i.e. M/s Apex Printers and
the impugned cheque was issued by the accused to discharge the
liability of one of his another firm M/s Apex Arts. This testimony of
CW1 is thoroughly incongruent with the claim of the complainant
in complaint and affidavit tendered in evidence.
18. At this stage, the following observations of the Hon'ble
Supreme Court in the case titled Rangappa Vs. Sri Mohan (2010)
11 SCC 441 are befitting:
"28. in the absence of compelling justification, reverse onus
clause usually impose an evidentiary burden and not a
persuasive burden. Keeping this in view, it is a settled
position that when an accused has to rebut the presumption
under Section 139, the standard of proof in doing so is that
of 'preponderance of probabilities'. Therefore, if the accused
is able to raise a probable defence which creates doubt
about the existence of legally enforceable debt or liability,
the prosecution can fail. 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."
19. In view of the explicit admission of CW1 that the impugned
cheque was not issued by accused for discharge of the liability of
his proprietorship firm M/s Apex Printers (the accused firm) but
for discharge of liability of another firm i.e. M/s Apex Arts; in
absolute contradiction to the assertions in the complaint and
affidavit, the dual presumptions under Section 139 of the Act stand
rebutted. Moreso, the same consequence also follows because of
the failure of complainant to seek relief under Section 138 of the
Act against the accused for discharge not of his own liability for
M/s Apex Printers but for M/s Apex Arts i.e. Issuance of cheque for
discharge of 'other liability' permitted under the Act.
20. It is the argument of the defence counsel that the present
complaint is vague and bereft of necessary clarity and details of
the transactions between the parties on the basis of which the
amount of impugned cheque was liquidated. To appreciate the
argument of defence counsel, it is befitting to quote Hon'ble High
Court of Delhi in case titled Pine Product Industries & Anr. Vs.
M/s R.P. Gupta & Sons 2007 I AD (Delhi) 433:
"6. The Ld. Counsel for petitioner submitted...that no details
whatsoever have been indicated as to what the liabilities
were, what were the 'amounts' for which the said cheque
was issued for part payment, on which dates the amounts
were taken by the petitioner. Nor were the exact amount
taken by petitioner mentioned.
...
12. In the present case, I find that ... apart from this, there is
no mention in the complaint as to when the amounts were or
amount was paid, what was the rate of interest, what was the
extent of the goods which were supplied and adjusted
against the complainant. ... All these details are
conspicuously absent. The petitioner has been convicted and
sentenced on the vague and bald allegation that cheque of
Rs. 3,15,000/had been issued by the petitioner in discharge
of liabilities of repayment of amounts taken by him. This is
the only statement contained in the complaint and no further
details are forthcoming even in the evidence led by
complainant.
13. In these circumstances, I hold that the courts below have
grossly erred in law in concluding that the petitioner was
unable to rebut the presumption raised under Section 139.
Since, the conviction and sentence have been raised merely
on the petitioner's alleged inability to rebut the presumption
and there is nothing available on record to establish the
complainant's case, I am of the view that the petitioner is
entitled to acquittal."
The present set of facts are similarly placed as that of the facts of
the aforesaid judgment to the extent that the present complaint also
does not clarify the transactions and liability on the basis of which
the accused issued the impugned cheque to the complainant.
21. In the opinion of the court, the aforesaid discussion goes on to
establish that accused has rebutted the dual presumptions of law
raised against him by the court. At this stage, the burden of proof
again shifts to the complainant. Hon'ble Supreme Court in case
titled M.S. Narayana Menon (Supra) held that once the accused is
found to discharge his initial burden, it shifts to the complainant.
The complainant has failed to establish on record that the
impugned cheque was issued by accused to discharge any legally
enforceable liability of M/s Apex Printers and Stationers on whose
account the impugned cheque is drawn. The complainant has also
failed to produce any bill/invoice raised either against M/s Apex
Printers or M/s Apex Arts which could establish the liquidated
liability of the accused. Thus, the case of the complainant suffers
from the basic infirmities which form the very basis of an offence
under Section 138 of the Act. Consequently, ingredient no. 1 and 2
stand decided against the complainant and in favour of accused.
4. It is urged by the learned counsel for the Petitioner that under Section 118
of the Act, there is a presumption that the cheques in question were issued
by the Respondents for consideration. Even if the authorised
representative of the Petitioner admitted in his cross-examination that
there was no business dealing with M/s.Apex Printers and Stationers,
Respondent No.1 was the proprietor of M/s.Apex Printers and Stationers
as well as of M/s. Apex Art and thus the Respondents could not shy away
from their liability to honour the cheques in question. The learned
counsel for the Petitioner argues that the learned MM erred in acquitting
the Respondents for the offence punishable under Section 138 of the Act.
5. As per the explanation appended to Section 138 of the Act debt or other
liability has to be construed as legally enforceable debt or other liability.
It is true that if a person „X‟ is the proprietor of two firms „A‟ and „B‟ or
even if one of the firms is a partnership firm, then the cheque issued by
„X‟ has to be treated as in discharge of legally enforceable debt or other
liability of firm „A‟ and „B‟ provided such a case is set up in the notice
and in the complaint. In such cases the liability is being taken by the
Proprietor or the Partner in such capacity. Even a third person can issue a
cheque it he agrees to discharge the liability of the person who is in debt.
But, then, such a case has to be set up. A perusal of the complaint, a copy
of which has been presented by the learned counsel for the Respondents
during the course of arguments, reveals that the Petitioner simply stated
that a cheque for a particular amount drawn on Canara Bank, Bhogal,
New Delhi in favour of the complainant, that is, the Petitioner towards the
amount due from them (Respondents) was dishonoured on presentation.
Paras 2 and 3 of the complaint in respect of cheque No.508821 dated
19.04.2008 for `18,276/- are extracted hereunder:
"2. That the accused had issued a cheque no.508821 dated
19.4.2008 for `18,276/-(Eighteen thousand two hundred
seventy six rupees only) drawn on Canara Bank, Bhogal, New
Delhi in favour of the complainant, Vikel Business Corporation
towards the amount due from them.
3. That the complainant presented the said cheque with
Allabahad Bank, Nehru Place Branch for encashment. The
said cheque was returned dishonoured by the Allahabad Bank
with return memo given by Canara Bank, Bhogal, New Delhi to
the complainant on 21.4.2008 with the reason "Funds
Insufficient".
6. The Petitioner was completely silent that the cheque was towards the
liability of M/s. Apex Art and that Bishan Das was the proprietor or
partner of the said M/s. Apex Art. Bishan Das was prosecuted in the
above mentioned four complaint cases as proprietor of M/s.Apex Printers
and Stationers. Thus, it cannot be said that the cheques were issued by
the Respondents towards legally enforceable debt or other liability.
7. It is urged by the learned counsel for the Petitioner that the Respondent
No.1 has not entered the witness box to deny his liability. It is the
cardinal principle of criminal jurisprudence that to prove his defence, an
accused need not produce any defence evidence. He can very much
prove his defence by taking aid of the evidence produced by the
prosecution including the material elicited in cross-examination of the
witnesses. That has exactly been done in the instant case as the Petitioner
has admitted that the cheque was issued not towards liability of M/s.Apex
Printers and Stationers, that is, Respondent No.2 but towards liability of
M/s. Apex Art. These facts having not been pleaded by the Petitioner
even in the complaint and as it is admitted that there was no liability of
M/s.Apex Printers and Stationers and Respondent No.1 was also
prosecuted as the proprietor of M/s.Apex Printers and Stationers, the
conclusion reached by the learned MM that the Respondents have
rebutted the presumption that the cheque was issued towards any legally
debt or other liability cannot be faulted.
8. The principles which govern and regulate the hearing of Appeal by the
High Court, against an order of acquittal passed by the Trial Court are
well settled by a catena of judgments of the Apex Court.
9. While considering a Petition for Leave to Appeal by the prosecution or
the complainant against an order of acquittal, the Court must be
convinced that there is grave miscarriage of justice on account of
erroneous view of the law or that the finding reached by the Trial Court is
perverse. Mere errors in the Trial Court‟s reasoning are insufficient to
interfere in an order of acquittal. There has to be substantial and
compelling reasons to interfere with an order of acquittal. As to what
constitute such reasons, has been spelt out in Chandrappa & Others v.
State of Karnataka (2007) 4 SCC 415 as follows:
"In light of the above, the High Court and other appellate
courts should follow the well settled principles crystallized by
number of judgments if it is going to overrule or otherwise
disturb the trial court's acquittal :
1. The appellate court may only overrule or otherwise disturb
the trial court's acquittal if it has "very substantial and
compelling reasons" for doing so. A number of instances arise
in which the appellate court would have "very substantial and
compelling reasons" to discard the trial court's decision. "Very
substantial and compelling reasons" exist when :
(i) The trial court's conclusion with regard to the facts is
palpably wrong;
(ii) The trial court's decision was based on an erroneous view
of law;
(iii) The trial court's judgment is likely to result in "grave
miscarriage of justice";
(iv) The entire approach of the trial court in dealing with the
evidence was patently illegal;
(v) The trial court's judgment was manifestly unjust and
unreasonable;
(vi) The trial court has ignored the evidence or misread the
material evidence or has ignored material documents like dying
declarations/report of the Ballistic expert, etc.
(vii) This list is intended to be illustrative, not exhaustive.
2. The Appellate Court must always give proper weight and
consideration to the findings of the trial court.
3. If two reasonable views can be reached - one that leads to
acquittal, the other to conviction - the High Courts/appellate
courts must rule in favour of the accused. Had the well settled
principles been followed by the High Court, the accused would
have been set free long ago. Though the appellate court's power
is wide and extensive, it must be used with great care and
caution."
10. In the instant case, the learned MM has given good reasons to come to
the conclusion that the Respondent had rebutted the presumption under
Section 118 of the Act and that the Petitioner had failed to establish that
the cheques were issued by the Respondent towards legally recoverable
debt or other liability.
11. The Petitions seeking Leave to Appeal, therefore, are without any merit;
the same are accordingly dismissed.
G.P. MITTAL, J.
MARCH 12, 2013
vk/pst
