Final Order 4

Order Details: Copy of Judgment
Pdf Text: Summary Cases/5800053/2021
Judgment Exh.45
MHMM180077342021
Filed on : 25.11.2021.
Decided on : 26.11.2024.
Duration : 03-Y 00-M 01-D.
IN THE COURT OF JUDICIAL MAGISTRATE (FIRST CLASS),
58TH COURT, BANDRA, MUMBAI.
(Presided over by M. P. Saraf)
Summary Cases/5800053/2021
(CNR NO.MHMM180077342021)
Exh.45
MR. SURAJ KOTIAN
Age : 41 years, R/o. Flat No.42, 4th Floor,
Vakola Masjid Road, Kadam Wadi,
Santacruz(E), Opp. To Kwality Restaurant and
Bar, Mumbai 400 050.
…. Complainant.
Versus
SMT. NISHWINDERKAUR HARDEEPSINGH
CHADDA
Age : 44 years, R/o. Flat No.601, B-Wing,
Shree Savali, Mogarpada Owela, G.B. Road,
Thane (W)-400 615.
…. Accused.
Offence U/sec.138 of the Negotiable Instruments Act, 1881.
Mr. Ramesh Kumar Singh Advocate for the complainant.
Mr. S.M.Shirsat Advocate for the accused.
JUDGMENT
(Delivered on 26.11.2024)
This is the complaint filed under section 138 of The
Negotiable Instrument Act for the reason of dishonor of cheques worth
Rs.22,90,000/- alleged to be issued against repayment of friendly loan
alongwith interest issued to the accused by the complainant.
-- 1 of 13 --
2 Summary Cases/5800053/2021
Judgment Exh.45
2. Complainant’s case in nut shell is as follows:
That the accused is his family friend. During year 2019-
2020 the accused was facing financial crises. Therefore, on his request
complainant gave him Rs.22,90,000/- against a friendly loan time to
time partly by cheque and cash. The amount of Rs.16,40,000/- was
taken by the accused to meet the financial crises of herself and her son
and one Mr. Glen Nazarath. The amount was to be repaid subject to
interest @ 30% per annum at the time of taking said amount, accused
has issued subject two cheques worth Rs.11,14,000/- and
Rs.11,76,000/- totalling to Rs.22,90,000/- on 15.09.2021. Out of said
amount Rs.16,40,000/- was the principal amount and Rs.6,50,000/-
was towards interest. Complainant deposited both cheques with his
banker HDFC Bank Ltd. Kalina branch on 01.10.2021. Both cheques
were dishonoured and returned unpaid with remarks, ‘Funds
Instrument’. Thereon complainant sent statutory notice dated
16.10.2021 to the accused by Registered Post. Accused gave false reply
to the notice on 06.11.2021 and refused to make payment. Hence, filed
this complaint.
3. My Ld. Predecessor taken cognizance of the complaint and
issued process against the accused under section 138 of Negotiable
Instruments Act. On appearance of the accused, particulars of offence
were stated to him in vernacular to which the accused pleaded not
guilty vide Plea dated 31.05.2022 at Exh.11 and claimed to be tried.
Though, the case is registered as summary case, the case was tried as
summons trial.
-- 2 of 13 --
3 Summary Cases/5800053/2021
Judgment Exh.45
4. The statement of accused under section 313 of Code of
Criminal Procedure was recorded at Exh.41 on 03.04.2024. The
accused has taken defence of total denial of any offence. She has taken
defence of money lending transaction, obtaining loan of only
Rs.3,43,000/- and making repayment of Rs.6,90,550/-, issing blank
signed cheques towards security of the loan and filing false case.
5. Heard advocate Mr. Ramesh Kumar Singh for the
complainant and advocate Mr. S.M.Shirsat for the accused. Perused
notes of arguments and citations filed by both parties.
6. On hearing both sides following points arise for my
determination to which I have recorded my findings with reasons
thereto as follows-
Sr.No. POINTS FINDINGS
1. Whether it is proved that the accused
has issued subject cheque bearing
No.000068 of Rs.11,14,000/- and
cheque No.000069 of Rs.11,76,000/-
both dated 01.10.2021 drawn on HDFC
Bank, Thane branch, in favour of the
complainant in discharge of the legally
enforceable debt or liability?
: No.
2. Whether it is proved that cheque was
dishonored for the reason “Funds
Insufficient” in the account of accused? : Yes.
3. Whether it is proved that despite service
of demand notice, the accused failed to
pay the cheque amount within statutory
period of 15 days after receiving notice
and thereby committed an offence
punishable under section 138 of the
Negotiable Instruments Act?
: No.
-- 3 of 13 --
4 Summary Cases/5800053/2021
Judgment Exh.45
4. What order? : Accused is held not
guilty and acquitted.
REASONS
7. To substantiate the contentions averred in the complaint,
complainant has examined himself at Exh.15. Besides oral evidence
complainant has relied upon disputed two cheques at Exh.17 and 18,
cheque return memo dated 01.10.2021 at Exh.19 and 20, office copy of
demand notice dated 16.10.2021 at Exh.21, Notice reply of accused
dated 06.11.2021 at Exh.26, other five original cheques alleged to
issued by the accused to the complainant on various dates at Exh.31 to
35, photo copy of account statement at Exh.37 and closed evidence.
Accused has not examined herself. However, has produced the photo
copy of her bank passbook, photo copies of the screen shots of payment
made through Gpay App, her bank account statement for the period
28.01.2020 to 28.06.2021.
AS TO POINT NO.1:-
8. It is the case of the complainant himself that he paid the
principal amount of Rs.16,40,000/- to the accused as a loan subject to
interest to be paid @ 30% p.a. The amount of Rs.6,50,000/- was
towards the outstanding interest to be paid by the accused. For
repayment of said total amount of Rs.22,90,000/- the accused has
issued subject two cheques produced at Exh.17 and 18. As against it,
the accused has came with a defence of obtaining loan of only
Rs.3,43,000/- and repayment made to the complainant around
Rs.6,90,550/-. According to her subject cheques were issued blank
signed towards security and the same are misused.
-- 4 of 13 --
5 Summary Cases/5800053/2021
Judgment Exh.45
9. In the light of above submissions first question arose for
determination whether complainant had proved his financial capacity
to lend such a huge amount? Secondly, whether complainant has
proved lending such huge amount to the accused? Thirdly, whether
complainant has a legal authority to lend money on interest? Lastly,
whether such transaction would fall within the ambit of definition of
legally enforceable liability or legal debt within the meaning of section
138 of the Negotiable Instrument Act? The points as to dishonour of
the cheque for the reason, ‘Funds Insufficient’, issuing statutory notice
by the complainant are not in dispute for consideration.
10. Complainant’s oral evidence unfolds that he was serving as
an Assistant Manager in Indigo Airlines for last 16 years. He was
earning net salary of Rs.65,000/- per month. Out of friendly relations
with the accused, he gave the friendly loan. He had given some amount
by cheque and some amount was paid in cash during year 2019-2020
to the accused. Out of alleged amount of loan of Rs.22,90,000/-,
Rs.16,40,000/- is the principal amount and Rs.6,50,000/- is towards
outstanding interest. However, he was not able to tell the dates of
parting money to the accused. His evidence further depicts that he has
not shown the alleged loan transaction in his Income Tax Returns. In
cross examination, he stated that subject cheques which are referred in
his evidence affidavit are not the Post Dated Cheques and the same
were obtained by him in the month of March 2021. He clarified further
that he obtained total 5 cheques from the accused. He admitted that he
do not possess money lending licence to lend money on interest.
11. Advocate for accused vehemently submitted that accused
has never taken or received alleged loan amount of Rs.22,90,000/-. No
-- 5 of 13 --
6 Summary Cases/5800053/2021
Judgment Exh.45
document was ever executed for lending such huge amount. He has
also questioned the financial capacity of complainant. Needless to state
that except the statement of complainant as to earning monthly salary
of Rs.65,000/- there is nothing on record to believe his statement.
Question crops up for determination that whether his statement
without proof would suffice to prove the financial capacity of the
complainant. Complainant has not produced his Income Tax Returns on
record. The photo copy of account statement produced by the
complainant at Exh.37 shows very less amount in his account during
said period which is not more than Rs.1,20,500/-. Therefore, his oral
evidence as to lending Rs.16,40,000/- to the accused time to time
appears doubtful.
12. Nothing is spelled as to the financial capacity of the
complainant in the written notes of arguments except the reiterated
statements of lending money and issuing subject cheques.
Complainant’s oral evidence is insufficient to establish the financing
capacity of the complainant to lend such a huge amount to the accused.
The complainant has measurably failed to establish his financing
capacity by leading appropriate evidence. His bare words as to making
payment in cash or by Gpay will not take place of proof.
13. As stated above except the unbelievable oral evidence of
the complainant, there is nothing on record to prove that complainant
actually gave such a huge amount to the accused may be time to time.
A person may be in friendly relations but it is something abnormal that
a prudent man give such a huge amount without getting executed any
document such as Promissory Note, loan documents or at least a
Receipt of acknoweldgement as to giving money. Further, complainant
-- 6 of 13 --
7 Summary Cases/5800053/2021
Judgment Exh.45
himself has pleaded lending money on interest @ 30% p.a. Said
transaction is not shown in his Income Tax Returns. Considering over
all suspicious facts revealed in the evidence of the complainant, it is
very hard to digest the contention of lending said huge amount to the
accused. In absence of any cogent evidence as to actually parting
money, it can not be said that complainant has proved lending such a
huge amount to the accused as stated in his complaint and affidavit.
14. The admission given by the complainant in his cross
examination clearly speaks about money lending transaction without
licence or authority. Advocate for complainant submitted that even if
the transaction is assumed, the same being illegal money lending
transaction, there can not exists legal debt or other liability within the
meaning of section 138 of the Negotiable Instrument Act.
15. In support of his submissions he has relied upon the
Judgment in the case of
Anil Baburao Kataria Vs.Purushottam
Prabhakar Kawane reported in 2010 CRI L. J. 1217 delivered by
Hon’ble Bombay High Court. I have gone through the sum and
substance of the ratio held in the case cited supra. It states that,
“
Carrying on money lending business without licence debarrs a person
from doing money lending and recovering the amount from the court.
In view of explanation to section 138 of the Negotiable Instrument Act,
debt or other liability means a legally enforceable debt or other
liability. A loan advanced by a money lender who is doing business of
money lending without licence is not a debt or other liability coming
within the purview of explanation to section 138 of the Act.”
-- 7 of 13 --
8 Summary Cases/5800053/2021
Judgment Exh.45
16. In view of averments made in the complaint as to lending
money on interest @ 30 % p.a. and Rs.6,50,000/- being towards
interest, there is reason to believe the defence of the accused that
complainant has indulged in illegal money lending business. One thing
is quite clear that the transaction on the basis of which the amount is
claimed, itself is illegal in the eyes of law. Therefore, the ratio laid
down in the case cited supra clearly applies to the case in hand. The
transaction would certainly beyond the purview of section 138 of the
Act. Said liability can not be said to be a legally enforceable liability or
debt to attract section 138 of the Act.
17. Advocate for complainant submitted that if there was no
any transaction in between complainant and accused, why would she
has issued various cheques in favour of the complainant. The
complainant is holder in due course of the subject cheques having
presumption of law under section 139 of the Act. Accused has not
examined herself or adduced evidence in rebuttal of such presumption
of law. Therefore, complainant has proved the aspect of existence of
legal liability on the date of cheques.
18. Needless to state that the presumption under section 139
and 118(a) of the Act are rebuttal presumption. Said presumption can
be rebutted by the accused by obtaining admissions in cross
examination of the complainant or producing oral or documentary
evidence or by examining himself or by creating doubt on the
trustworthiness of the case of the complainant. It is also settled law
that for the said rebuttal of presumption accused need not want to
examine himself or witnesses as held in
M/s. Kumar Exports Case.
-- 8 of 13 --
9 Summary Cases/5800053/2021
Judgment Exh.45
19. In the case of
M/s. Kumar Exports Vs. M/s. Sharma
Carpets (Criminal Appeal No.2045 of 2008), Hon'ble Supreme Court
has held that,
“
The use of phrase “until the contrary is proved” in section 118 of the
Act and use of the words “unless the contrary is proved” in section 139
of the Act read with definitions of “may presume” and “shall presume”
as given in Section 4 of the Evidence Act, makes it at once clear that
presumption to be raised under both the provisions are rebuttable.
When a presumption is rebuttable, it only points out that the party on
whom lies the duty of going forward with evidence, on the fact
presumed and when that party has produced evidence fairly and
reasonably tending to show that the real fact is not as presumed, the
purpose of the presumption is over. The accused in a trial under section
138 of the Act has two options. He can either show that consideration
and debt did not exist or that under the particular circumstances of the
case the non-existence of consideration and debt is so probable that a
prudent man ought to suppose that no consideration and debt existed.
To rebut the statutory presumptions an accused is not expected to
prove his defence beyond reasonable doubt as is expected of the
complainant in a criminal trial.”
20. The accused has sought some crucial admissions in the
cross examination of the complainant indicating that the transaction of
loan or interest is illegal. The accused has came with a case of
obtaining loan of Rs.3,43,000/- from the complainant and its
repayment to the extent of Rs.6,60,550/-. Complainant has denied the
suggestion given to him in the cross examination. Accused has made
foundation of her defence in her notice reply Exh.26. Further, there is
-- 9 of 13 --
10 Summary Cases/5800053/2021
Judgment Exh.45
no re-joinder to the notice reply given by the accused. Accused has also
produced photo copies of her Bank Pass Book and screen shots of Gpay
App alongwith application Exh.41. The same shows various payments
made to the complainant by the accused. Therefore, also the defence of
the accused appears probable and trustworthy.
21. In the case in hand, the complainant has failed to prove his
financial capacity to lend such huge amount, further aspect of actually
making payment of such huge amount to the accused. So also, the
transaction even if it is accepted, the same is an illegal money lending
transaction without licence as required under section 5 of Bombay
Money Lenders Act. The complainant himself has produced other five
different cheques besides disputed two cheques of the account of
accused at Exh.31 to 35. In cross examination, he stated obtaining total
5 cheques from the accused. In this context the defence of the accused
that her blank signed cheques were obtained towards security of loan
appears probable and trustworthy. Thereby accused has created
substantial doubt on the trustworthiness of the complainant’s case
through the cross examination of the complainant. Resultantly, the
presumption of law under section 139 is successfully rebutted by the
accused compelling the complainant to give more trustworthy evidence
in which he has failed.
22. For attracting the criminal liability on the basis of
negotiable instrument, proving existence of legally enforceable debt or
other liability is sine qua non. Unless existence of legally enforceable
liability is duly proved, the negotiable instrument is of no legal value.
In short, only the presumption of law under section 139 of the Act will
not dispense with the proof of existence of legal debt. Therefore, the
-- 10 of 13 --
11 Summary Cases/5800053/2021
Judgment Exh.45
cheques in question can not be said to be issued in discharge of legally
enforceable debt or other liability as required under section 138 of the
Negotiable Instrument Act. Hence, I answer point No.1 in the negative.
AS TO POINT NO.2 :
23. The complainant has produced cheque return memos at
Exh.19 and 20. The complainant has produced cheque return memos
which shows that cheques are dishonoured for the reason of
‘Insufficient Funds’. The question of dishonour of cheques is not in
dispute. However, there is reason to believe the defence of the accused
that the same were given towards security of loan and not towards
payment. Hence, I answer the point No.2 in the affirmative.
AS TO POINT Nos.3 AND 4 :
24. For proving the guilt of the accused under section 138 of
the Act, the complainant has to prove existence of legally enforceable
debt or other liability towards the accused. The complainant has failed
to prove existence of legally enforceable debt or other liability as
provided in explanation to section 138 of the Act, to pay the cheques
amount towards alleged friendly loan transaction with the accused. In
fact, complainant has failed to prove any such transaction with the
accused. The defence raised by the accused appears probable and
trustworthy. For proving the guilt under section 138, the complainant
has to prove all the 5 essential ingredients. Complainant has failed to
prove the complaint beyond all reasonable doubts. Hence, I answer
point No.3 in the negative and pass following order.
-- 11 of 13 --
12 Summary Cases/5800053/2021
Judgment Exh.45
ORDER
1. The accused is acquitted of the offence punishable under
section 138 of the Negotiable Instruments Act, 1881 vide
section 255(1) of The Criminal Procedure Code.
2. Bail bond of accused stands cancelled.
3. The accused to comply sec.437(A) of Cr.P.C. and furnish
surety for further period of six months from today.
(Judgment dictated and pronounced in open Court).
( M. P. Saraf )
Judicial Magistrate(First Class),
Date : 26.11.2024 58th Court, Bandra, Mumbai.
J.O.Code: MH01362
-- 12 of 13 --
13 Summary Cases/5800053/2021
Judgment Exh.45
CERTIFICATE
I affirm that the contents of this P.D.F. file Judgment are same, word to word as per
the original Judgment.
Name of Stenographer : Mrs.Aditi Ravikiran Dalvi
Court : Judicial Magistrate(First Class), 58th Court,
Bandra, Mumbai.
Dictated in open court on : 26.11.2024.
Transcribed and Typed on : 26.11.2024.
Judgment printed and Signed on : 26.11.2024.
Judgment Uploaded on : 26.11.2024.
-- 13 of 13 --