Vijay Power Generators Ltd vs Annai Engineering Works & Anr
2014 Latest Caselaw 2003 Del

*       IN THE HIGH COURT OF DELHI AT NEW DELHI

                                                   Date of Decision: 22.04.2014

+               CRL. A.1437 of 2013 & CRL. A.1447 of 2013

VIJAY POWER GENERATORS LTD               ..... Appellant
              Through: Mr. B.K. Pandey, Adv.

                                         versus

ANNAI ENGINEERING WORKS & ANR                 ..... Respondents
               Through:   Mr. R.K. Jain & Ms. Manisha Chauhan,
                          Advs.
CORAM:
HON'BLE MR. JUSTICE V.K. JAIN

                                         JUDGEMENT

V.K. JAIN, J. (Oral)

These appeals are directed against two separate orders dated 14.5.2013,

of the Metropolitan Magistrate whereby two complaints filed by the appellant

against the respondent under Section 138 of the Negotiable Instrument Act,

1881, were dismissed on merits.

The case of the complainant/appellant in nutshell is that it is a limited

Company engaged in the business of sale and purchase of diesel generator sets,

alternators, etc. and the respondent, who is carrying on business under the

name and style of Annai Engineering Works purchased some goods from it

against bills. The respondent issued four (4) cheques - three (3) cheques dated

6.3.2000, out of which two (2) were for Rs.2.00 lakh each and one (1) cheque

for Rs.2,71,326/-; and one (1) cheque dated 13.10.2000 for Rs.4.00 lakh

towards payment of the price of the material supplied to him. The aforesaid

cheques when presented for payment to the bank were dishonoured with the

remarks "Account already closed"/"Not arranged for". The

appellant/complainant served notice upon the respondent requiring him to pay

the amount of the aforesaid dishonoured cheques. The respondent having

failed to do so the aforesaid complaints were filed.

2. The appellant/complainant examined three (3) witnesses in support of its

case whereas the respondent examined himself as DW1.

3. A cheque being a negotiable instrument there is a statutory presumption

that the cheques were issued for consideration. The presumption no doubt is

rebuttable, but, the onus is upon the drawer of the cheque to prove that the

same were without consideration.

4. It is an admitted position that the aforesaid four (4) cheques were issued

by the respondent/accused to the complainant/appellant. It is also an admitted

position that the aforesaid cheques when presented to the bank were

dishonoured, for the reasons referred to hereinabove. The case of the

complainant/appellant is that the aforesaid cheques were issued towards

payment of the price of the goods sold and delivered to the respondent whereas

the case of the respondent, as reflected in his deposition, is that the aforesaid

cheques were issued as security for purchase of the generator sets.

5. Ex.CW2/N is the statement of account filed by the

complainant/appellant, which shows that on 1.4.1999, there was a debit balance

of Rs.10,66,325.66 in the account of Annai Engineering Works which is the

trade name of the respondent. The statement of accounts also shows that a sum

of Rs.17,55,679.66 was due from the respondent to the complainant/appellant

as on 31.3.2000. The statement of accounts coupled with the deposition of the

witnesses examined by the complainant would show that the

complainant/appellant has been supplying goods to the respondent and a sum

of Rs.6,71,326/- was still due to it as on 31.3.2000.

6. The only evidence led by the respondent to discharge the statutory onus

placed on him is his own deposition as DW1. In the examination-in-chief

deposition the respondent inter alia stated that there was no outstanding

liability of the complainant Company towards him and the cheques in question

were signed as blank, as security in reference to purchase of generators. He

also claimed that he had not received any generator from the complainant

Company for which cheques in question had been issued. During cross-

examination by the learned counsel for the complainant, DW1 Mr. J.

Stanishlaus, Proprietor of Annai Engineering Works stated that he had taken

just 1-2 generator sets from the complainant Company. He specifically denied

the suggestion that he had purchased seven (7) generator sets from the

complainant Company. Thus, the case as set out by DW1 in his deposition is

that he had purchased only 1-2 generator sets from the complainant Company.

On the other hand, in his statement under Section 313 of Cr.P.C. the respondent

expressly stated that he had handed over cheques in question as blank signed

cheques for the purpose of security as he had to purchase seven (7) generator

sets and the complainant supplied seven (7) generator sets to him. It is, thus,

evident that the respondent/accused made a false statement on oath when he

claimed that only 1-2 generator sets were supplied to him. Having admitted the

delivery of seven (7) generator sets to him the onus was on the

accused/respondent to prove that he had paid for the said generator sets. It has

come in the cross-examination of DW1 that he had issued demand drafts of

Rs.7.75 lakh to the complainant/appellant as per Ex.DW1/6. However, a

perusal of the letter Ex.DW1/6 would show that it refers to a demand draft of

Rs.3.00 lakh sent on 7.11.1997, and not to one or more demand drafts of

Rs.7.75 lakh. As per the statement of accounts filed by the

appellant/complainant Company, it received only two (2) payments from the

respondent in the financial year 1999-2000, i.e., between 1.4.1999 to

31.3.2000. Out of them one payment was for Rs.17,000/- and the other was for

Rs.25,000/-. The cheques for Rs.6,71,326/- which were deposited with the

bank on 7.3.2000 were dishonoured and the amount of the aforesaid cheques

was debited in the account of the respondent on 23.3.2000. The

respondent/accused did not examine any bank official to prove any payment of

Rs.7.75 lakh to the complainant by way of demand draft. In case any such

payment was actually made, after the delivery of the generator sets was

received, nothing prevented the respondent/accused from summoning the bank

official(s) to prove the aforesaid payment. Moreover, no receipt evidencing

payment of Rs.7.75 lakh has been filed by the respondent/accused. On receipt

of notice from the complainant/appellant, admittedly no reply was sent by the

respondent/accused, claiming payment of Rs.7.75 lakh by way of demand draft

or alleging that the cheques in question were given as blank cheques, towards

security. No notice was sent by the respondent/accused to the

complainant/appellant Company at any point of time, asking for the return of

the cheques in question on the ground that the payment had already been made

by way of demand draft. In fact, in his examination-in-chief DW1 did not even

refer to any payment to the appellant/complainant by way of any demand draft

and the plea of such payment cropped up only during the cross-examination of

the respondent/accused. The respondent did not file his own statement of

account, to show that nothing was payable by him to the appellant.

7. For the reasons stated hereinabove, I am of the considered view that the

respondent/accused failed to discharge the statutory onus placed on him to

prove that the cheques in question were without consideration. On the other

hand, the evidence produced by the complainant/appellant clearly proves that a

sum of Rs.6,71,326/- was due to the appellant/complainant Company as on

31.3.2000.

8. It was contended by the learned counsel for the respondent/accused that

the complaint has not been filed by a duly authorised person on behalf of the

Company. I, however, find no merit in the contention. The complainant was

filed in the name of the Company and was signed by Shri G.K. Pachauri,

Assistant Manager (Legal). Ex.CW2/A is the Special Power of Attorney

executed by Shri K.K. Sharma, Chairman of the appellant-Company in favour

of Mr. Pachauri authorising him inter alia to file complaints on behalf of the

Company in any court in any civil, criminal or revenue matter and to sign all

the papers including complaints and affidavits on behalf of the Company. The

aforesaid power of attorney has been executed before a Notary Public on

31.5.1999 in view of the provisions contained in Section 85 of the Evidence

Act, 1872, there is a statutory presumption not only that the aforesaid power of

attorney was actually executed by Shri K.K. Sharma but also that Shri K.K.

Sharma was competent to execute such a power of attorney on behalf of the

appellant/complainant Company. Moreover, the Managing Director of the

Company has come in the witness box as CW3 and he has confirmed the power

of Attorney given in favour of Mr. Pachauri.

In Jugraj Singh and Anr. Vs. Jaswant Singh and Ors. AIR 1971 SC 761,

the Power of Attorney attested by a Public Notary was disputed on the ground

that it did not show on its face that the Notary had satisfied himself about the

identity of the executant. Supreme Court held that there was a presumption of

regularity of official acts and that the Notary must have satisfied himself in the

discharge of his duties that the person who was executing it was the proper

person. In Rajesh Wadhwa vs. Sushma Govil AIR 1989, Delhi 144, it was

contended before this Court that till it is proved that the person who signed the

said power of attorney was duly appointed attorney, the court cannot draw a

presumption under Section 57 and 85 of the Evidence Act. Repelling the

contention, it was held by this Court that the very purpose of drawing

presumption under Sections 57 and 85 of the Evidence Act would be nullified

if proof is to be had from the foreign country whether a particular person who

had attested the document as a Notary Public of that country is in fact a duly

appointed Notary or not. When a seal of the Notary is put on the document,

Section 57 of the Evidence Act comes into play and a presumption can be

raised regarding the genuineness of the seal of the said Notary, meaning

thereby that the said document is presumed to have been attested by a

competent Notary of that country. In Punjab National Bank vs. Khajan Singh

AIR 2004 Punjab and Haryana 282, the Power of Attorney in favour of a bank,

which had been duly attested, was rejected by the learned District Judge on the

ground that the presumption under Section 85 of Evidence Act was available to

a particular class of Power of Attorneys described in the section, which was

confined to its execution and authenticity alone. The High Court, however,

rejected the view taken by the learned District Judge holding that absence of

proof of resolution authorizing the executant to execute the Power of Attorney

could not be sustained and a presumption in favour of the attorney would arise

under Section 85 Act.

9. For the reasons stated hereinabove the impugned orders dated 14.5.2013

are hereby set aside. The respondent/accused is convicted under Section 138 of

the Negotiable Instrument Act and is sentenced to undergo imprisonment for

three (3) months each in both the complaints. He is also sentenced to pay fine

of Rs.13.00 lakh in CC No.VK-93/2000 and fine of Rs.7.00 lakh in CC

No.VK-82/2000. Out of the fine, if realised, 90 per cent shall be released to the

appellant/complainant as compensation. In default of payment of fine the

respondent/accused shall undergo imprisonment for six (6) months in CC

No.VK-93/2000 and for three (3) months in CC No.VK82/2000. The

respondent/accused is granted four (4) weeks from today to deposit the amount.

He is also directed to surrender within a week before the trial court. If he fails

to do so, the trial court shall take steps to procure his presence and to commit

him to prison to undergo the sentence awarded to him.

The appeals stand disposed of.

The LCR be sent back along with a copy of this order.

APRIL 22, 2014                                               V.K. JAIN, J.
b'nesh