Final Order 1

Order Details: Copy  of Judgment
Pdf Text: 1 C. C. No. 648/SS/2019
Filed on : 18/02/2019
Registered on : 18/02/2019
Decided on : 21/07/2023
Duration : 04Y. 05M. 03D.
IN THE COURT OF METROPOLITAN MAGISTRATE
48TH COURT ANDHERI MUMBAI
(Presided over by K. G. Sawant)
Case No. 648/SS/2019
CNR: MHMM190028172019
Exh. No.
M/s. Shree Nakoda Gold, having address
at 3 Agyari Lane, Khau Gully, Zaveri Bazar,
Mumbai – 400 003, Duly represented by :
Mr. Akshay Puranmal Jain authorized representative
of Complainant firm. …Complainant
Versus
1. Yash Jewelers
2. Mr. Jayesh Mohanlal Jain.
(Proprietor of Yash Jewelers)
All having registered office address at :
Shop No. G3, Nehru Nagar,
Near Jain Mandir, Kurla (East),
Mumbai – 400024. ...Accused
Offence punishable U/s. 138 of
Negotiable Instruments Act
Advocate Anand Prakash Mishra for the complainant
Advocate R. R. Kushwah for accused.
JUDGMENT	JUDGMENT
(Delivered on 21/07/2023)
Accused is mired in the trial, for having committed an
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offence punishable U/s. 138 of the Negotiable Instruments Act, 1881.
(Hereinafter it is referred as 'N. I. Act' in short.)
Bonsai facts of the complaint are as under :
2] Complainant is a proprietorship firm. Complainant has filed this
complaint through its proprietor and duly authorized person namely
Mr. Akshay Jain. Complainant is engaged in the business of
manufacturing of gold and silver ornaments. Accused No. 1 is also a
proprietorship firm engaged in the business of gold and accused no. 2 is
a proprietor of accused no. 1 firm. As per order of accused,
complainant had given one “Magalsutra” of 22 Carat gold and in order
to pay amount of said Mangalsutra, accused issued cheque bearing no.
38462 dated 05/11/2018 for an amount of Rs. 53,58,528/ drawn from
his account maintained with Canara Bank.
3] On 05/11/2018, complainant received call from police station,
Kurla, Nehru Nagar stating that, accused has attempted to commit
suicide leaving behind one suicide note, in which name of complainant
was mentioned as one of the abettor. However, later on accused
admitted his liability and asked the complainant to deposit said cheque.
Accordingly, complainant presented said cheque for clearance on
3/01/2019 but vide memo dated 04/01/2019, said cheque returned
unpaid for the reason “Insufficient Fund”.
4] After dishonoure of cheques, complainant issued statutory
demand notice to accused on 17/01/2019, calling upon accused to pay
the cheque amount, within stipulated time, which was served upon
accused on 18/01/2019. Inspite of service of notice, accused did not
pay cheque amount. Hence, complainant filed this complaint against
the accused on 18/02/2019.
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5] After issuance of process, accused appeared and thereafter
substance of accusation was read over to the accused to which accused
pleaded not guilty and opt for trial.
6] In order to prove guilt of accused, complainant examined himself
by filing his affidavit in lieu of examinationinchief at Exh. 11, vide
section 145 of the Negotiable Instrument Act. Besides oral evidence,
complainant has relied upon following documentary evidence that
includes:
Description of documents Exh. No.
Copy of Statement given to police ArticleA
Copy of two invoices Exh. 20 and 21
Disputed cheque Exh. 22
Cheque returned memo ArticleB
Returned memo in handwriting Exh. 23
Office copy of notice Exh. 24
Reply from the accused Exh. 25
7] After completion of complainant's evidence, statement of accused
vide Section 313 of Cr.P.C. was recorded at Exh. 33, wherein accused
has denied his liability to pay the cheque amount to the complainant.
Accused in his defence neither examined himself nor any witness.
8] Complainant has filed his written notes of argument at Exh. 35
while Ld. Advocate for accused filed his written notes of argument at
Exh. 36.
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9] Heard Ld. Advocate for both parties at length. Perused written
notes of argument. In view of accusation and argument of both parties,
following points arise for my determination and I have recorded my
findings thereon as follows:
Sr.
No.
Points Findings
1. Does complainant prove that disputed
cheque was issued by the accused, in favour
of complainant for discharging legal
enforceable liability?
…. In the
affirmative
2. Does complainant prove that cheque was
returned unpaid for reason “Funds
Insufficient”?
…. In the
affirmative
3. Does complainant further prove that he had
issued statutory demand notice to the
accused within limitation demanding cheque
amount ?
…. In the
affirmative
4. Does complainant further prove that inspite
of service of notice accused has failed to pay
cheque amount to complainant within
statutory limit?
…. In the
affirmative
5. Whether complaint is filed within period of
limitation? .. In the
affirmative
6. What order ?
.. Accused is
convicted.
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REASONS
Admitted/undisputed fact
10] Before going further it is necessary to mention
admitted/undisputed facts of this case.
Admittedly disputed cheque is drawn from the
account of accused and it bears his signature.
AS TO POINT NO. 1
11] The accused is roped in the offence punishable u/s. 138 of
the N.I. Act. Upon perusal of relevant provision it is manifest that to
constitute offence punishable U/s. 138 of N.I. Act following ingredients
are to be fulfilled which are mandatory in nature.
 A person must have drawn a cheque on an account maintained by
him in a bank for the payment of certain amount of money to
another person from out of that account for the discharge in whole
or in part, of any debt or other liability.
 That the cheque has been presented to the bank within a period of
Three months from the date, on which it is drawn or within period
of its validity, whichever is earlier.
 That the cheque is returned by the bank unpaid, either because the
amount of money standing to the credit of the account, is
insufficient to honour the cheque or that exceeds and amount
arranged to be paid from that account by an agreement made with
the bank.
 The payee or the holder in due course of the cheque makes a
demand for the payment of said amount of money by giving a
notice in writing, to the drawer of the cheque, within 30 days of
the receipt of the information by him from the bank regarding
dishonor of the cheque as unpaid.
 The drawer of the said cheque fails to make payment of said
amount of money to the payee or holder in due course of the
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cheque within 15 days from the receipt of the said notice.
 The payee or holder in due course lodged written complaint in the
court within 30 days thereafter.
 The drawer of the said cheque failed to rebut the presumption u/s.
118 and 139 of the N.I. Act.
12] Before going further, it is necessary to mention here that, as per
Section 139 of N.I. Act, there is a presumption in favour of holder of
cheque. So also as per Section 118 of the Said Act, there is a
presumption that said cheque was issued for certain consideration. For
ready reference Section 118 and 139 of the said act are quoted below:
Sec. 118Presumptions as to negotiable instruments. Until the
contrary is proved, the following presumptions shall be made:
a) of consideration. that every negotiable instrument was
made or drawn for consideration, and that every such
instrument, when it has been accepted, indorsed, negotiated or
transferred, was accepted, indorsed, negotiated or transferred
for consideration;
b) as to date. that every negotiable instrument bearing a date
was made or drawn on such date;
c) as to time of acceptance. that every accepted bill of
exchange was accepted within a responsible time after its date
and before its maturity;
d) as to time of transfer . that every transfer of a negotiable
instrument was made before its maturity;
e) as to order of indorsements. that the indorsements
appearing upon a negotiable instrument were made in the
order in which they appear thereon;
f) as to stamp. that a lost promissory note, bill of exchange or
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cheque was duly stamped;
g) that holder is a holder in due course. that the holder of a
negotiable instrument is a holder in due course:
Provided that, where the instrument has been obtained from its
lawful owner, or from any person in lawful custody thereof, by
means of an offence or fraud, or has been obtained from the
maker or acceptor thereof by means of an offence or fraud, or
for unlawful consideration, the burden of proving that the
holder is a holder in due course lies upon him.
Section 139. Presumption in favour of holder. It shall be
presumed, unless the contrary is proved, that the holder of a
cheque received the cheque, of the nature referred to in Section
138, for the discharge, in whole or in part, of any debt or other
liability.
13] Being cumulative, it is only when all above mentioned
ingredients are satisfied then the person who had drawn the cheque can
be deemed to have been committed an offence u/s .138 of the Act. For
the purpose of section 138, debt or other liability means a legally
enforceable debt or other liability. To understand the spirt of provisions
contemplated vide section 138 to 141 of Negotiable Instrument Act,
Section 139 of the said act plays significant role. In view of express
provision of section 139 of N.I. Act a presumption shall be drawn that
the holder of cheque, received the cheque, of the nature referred to in
Section 138 for the discharge of any debt or other liability unless
contrary is proved. Thus, it gives power to court to presume unless
contrary is proved that the holder of cheque received the cheque for
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discharge in whole or in part of any debt or other liability. The word
“shall presume” as per Section 4 of Indian Evidence Act means
whenever it is directed by this act, that the court shall presume a fact, it
shall regard such fact as a proved unless and until it is disproved. Thus,
the burden of proof as to cheque has not been issued as a legal debt or
liability is always on accused and it is for him to rebut said
presumption. A useful guidance on the said point can be taken from the
verdict delivered by Hon'ble Supreme Court in the case of Goa Plast
Pvt. Ltd. V/s .Chico D'souza (2004 SCC (cri) 499) wherein the court
has considered the object behind section 138 and 139 of the N.I. Act
and held that the entire burden is on accused to show that cheque was
not issued for any debt or liability as mentioned in the complaint.
Hon'ble Court has further held that presumption u/s. 139 is a rebuttable
and it can be rebutted on the basis of evidence brought by the
complainant or by leading his own evidence. The standard of proof for
rebutting the presumption is preponderance of probabilities which is a
standard applicable to the accused whenever accused is required to
prove a fact.
14] In order to prove his case, complainant examined himself, by
filing his affidavit of examinationinchief at Exh. 11, wherein he has
reiterated his case from the complaint. His evidence shows that, he had
given one Mangalsutra of gold having weight 1633 gram worth Rs.
53,58,528/ to the accused. In support of his evidence, he has produced
on record GST invoice at Exh. 20 and 21 for an amount of Rs.
39,35,681/ and Rs. 14,22,847/.
15] Inspite of opportunity given, Ld. Advocate for accused did not
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conduct crossexamination of complainant and hence oral as well as
documentary evidence adduced by the complainant has gone
unchallenged. In his statement u/s. 313 of Cr.P.C., accused has denied
his liability to pay cheque amount. However, he did not explain as to
why said cheque was issued by him. Accused has replied to demand
notice through his advocate Kantilal Gaikwad. In reply notice, accused
has admitted his liability to pay an amount of Rs. 33,00,000/.
However, he did not adduce evidence in support of his contention in
notice. Thus, oral and documentary evidence produced on record by the
complainant is sufficient to prove that, complainant had sold out gold
ornaments to the accused and in order to pay amount of those
ornaments, disputed cheque was issued by the accused in favour of
complainant. In result point no. 1 is answered in the affirmative.
AS TO POINT NO. 2 TO 5
16] In order to prove that cheque was dishonoured, complainant has
filed on record two cheques returned memos, out of which memo at
articleA is computer generated print out without having seal and
signature of concerned bank. However, another memo filed at Exh . 23
is in handwriting in the printed format of the bank. It bears stamp of
the bank and signature of concerned officer. Thus, as per presumption
u/s. 146 of N.I. Act, it is to be presumed that, said cheque was
dishonoured on 05/01/2019 for the reason “Funds Insufficient”.
Complainant has produced on record office copy of demand notice
dated 17/01/2019 and photocopy of postal receipt. However, original
postal receipt are not produced on record. He also produced on record
track consignment report to show that, notice was delivered to the
accused. In this case, accused has filed reply to demand notice on
14/02/2019 which shows that, notice was duly served upon accused.
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Admittedly, accused has not paid cheque amount to the complainant.
Therefore, if it is presumed that, notice was served on the same day on
which it was dispatched, then also complaint filed on 18/02/2019 is
well within limitation. In result, point no. 2 to 5 are answered in the
affirmative.
AS TO POINT NO.6
17] Taking into consideration answer of points Nos. 1 to 5, it
becomes clear that, the complainant has duly proved his claim with
cogent evidence against the accused. The offence P/u/s. 138 of the
Negotiable Instruments Act is established against the accused. After
considering the conduct of the accused and nature of offence, I do not
find any special reasons or justifications to extend the benefit of
probation to them vide Section 3 to 5 of the Probation of Offenders Act,
1958. Therefore, the accused is called upon to state on the point of
sentence.
(K. G. Sawant)
Date : 21/07/2023 Metropolitan Magistrate,
48th Court, Andheri, Mumbai.
Hearing on the point of sentence:
18] I explained to accused that, he is held guilty for the offence
of the dishonor of cheque and that the N.I. Act has provided
punishment to the offence of imprisonment upto two years and fine
upto twice of the cheque amount. Thereafter, I asked the accused to
clarify his stand on the nature and quantum of the sentence, if any.
19] Upon asking on the point of sentence, accused submitted that
said cheque was issued for security purpose. He further stated that he
is liable to pay an amount of Rs. 33,00,000/ to the complainant. Ld.
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Advocate for accused prayed for minimum punishment. On the other
hand, Ld. Advocate for complainant prayed for maximum punishment
and compensation to the complainant.
20] Heard both parties and their Ld. Advocates at length on the point
of sentence. Present Matter is pending since 2019. Considering nature
of offence, period since which case is pending, considering purpose of
legislature behind enactment of Section 138 of N.I. Act and guidelines
laid down by Hon'ble Supreme Court in relation to compensation
Suitable and appropriate compensation alongwith penal action against
the accused would suffice the purpose and also meets the ends of
justice. In result, I proceed to pass following order :
ORDER
i. The accused Mr. Jayesh Mohanlal Jain Proprietor of Yash
Jewelers is hereby convicted for the offence punishable under section
138 of the Negotiable Instrument Act, 1881 vide section 255(2) of the
Code of Criminal Procedure, 1973.
ii. Accused is hereby sentenced to suffer simple imprisonment for
the period of Six months and he shall pay compensation of Rs.
60,00,000/ (Rs. Sixty Lacs) to the complainant, vide Section 357(3) of
the Code of Criminal Procedure, Accused shall pay above amount of
compensation within two months from today, in default of payment of
compensation, accused shall suffer simple imprisonment for the period
of One month.
iii. The amount of compensation realized from the accused, shall be
paid to the complainant, subject to expiry of the appeal period or the
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orders of Honourable Appellate Court (if any).
iv. Accused to surrender his bail bonds.
v. No question of setoff under section 428 of the Code of Criminal
Procedure, 1973, as the accused has not spent any period in the custody
during the trial.
vi. The copy of this Judgment be provided free of cost to the
accused, immediately after it is prepared, in view of section 363(1) of
the Code of Criminal Procedure, 1973.
vii. Accused is informed about having his right to prefer appeal
against this judgment within a statutory period before Hon'ble Sessions
Court.
viii. Dictated and pronounced in open court.
Mumbai (K. G. Sawant)
Dt. 21/07/2023 Metropolitan Magistrate
48th Court, Andheri, Mumbai.
Dictated On : 21/07/2023
Typed On : 21/07/2023
Signed On : 21/07/2023
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