Final Order 4

Order Details: Copy  of Judgment
Pdf Text: (1) CC. No.1951/SS/2018 [Judg.]
CNR No.MHMM19-005093-2018
Received on : 23 04 2018
Registered On : 27 04 2018
Decided on : 01 04 2025
Duration : Y M D
06 11 08
IN THE COURT OF
JUDICIAL MAGISTRATE, FIRST CLASS
[63RD COURT, ANDHERI, MUMBAI]
[PRESIDED OVER BY SHRI. R.D. DANGE]
C.C. No.1951/SS/2018
Exh.74
M/s. V. K Enterprise
A Registered Partnership Firm,
Having its office at
98, Ratna Jyot Industrial Estate,
Irla Lane, Vile Parle (W),
Mumbai-400 056.
Through Authorized officer
Ms. Anjana Vikas Parmar ...Complainant
Versus
M/s. Aristo (INDIA) Corporation,
Proprietor Jayanti N. Shah
Office Address :
623, Prestige Industrial Estate,
Marwe Road, Bawadi Lane,
Near Orlame Church, Malad (W),
Mumbai-400 064. ...Accused
________________________________________________________
Adv. for Complainant : Shri. S. N. Imam
Adv. for Accused : Shri. Jayesh Patel
________________________________________________________
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(2) CC. No.1951/SS/2018 [Judg.]
CNR No.MHMM19-005093-2018
J U D G M E N T
(Delivered on 01/04/2025)
Accused is facing trial for an offence punishable
under Section 138 of the Negotiable Instruments Act
(hereinafter referred to as the N.I. Act).
Complainant’s case :
2] Complainant is working as Senior Executive with
partnership firm and has been authorized by virtue of Authority
letter dated 06/04/2018. Complainant deals in supply of
wholesale chemicals and solvents and authorized distributor of
some famous brands in pharmaceuticals, solvents and laboratory
chemicals. Accused is proprietor of M/s. Aristo (INDIA)
Corporation and looking after day to day affairs as well as
managing activities. Accused negotiated and discussed
transaction of sale with complainant from the time of placement
of purchase order, fixation of price, delivery of goods and
payments. In ordinary course of business complainant sold,
supplied and delivered to accused product namely Hydrogen
peroxide (50%) under various bills and invoices and as on
10/06/2017 an amount of Rs.1,65,232/- was due and payable
by the accused.
3] In repayment of said outstanding amount accused
issued three cheques bearing Nos.010321, 010322 and 010323
drawn on Bank of Baroda, Kandivali (W) branch, Mumbai.
Complainant deposited said cheques for encashment with his
banker but they were dishonoured for the reason “Funds
Insufficient”. After dishonour of cheques, complainant issued
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statutory demand notice dated 25/09/2017 and called upon
accused to make payment. On 15/01/2018 accused gave reply
to said demand notice raising false contentions and alongwith
said reply he issued three fresh cheque No.10826 dated
15/01/2018 for Rs.82,680, cheque No.10827 dated 19/01/2018
for Rs.41,340 and cheque No.10828 dated 22/01/2018 for
Rs.41,212/- all drawn on Bank of Baroda, Kandivali (W) branch
Mumbai.
4] Complainant presented said cheques for
encashment with his banker i.e. Kotak Mahindra Bank, Vile Parle
(W) branch Mumbai. However, they were returned on
27/03/2018 with remark ‘Funds Insufficient’. Thereafter, on
03/04/2018 complainant issued demand notice to the accused
by R.P.A.D. which was received by accused on 04/04/2018. In
spite of receipt of notice, accused did not pay cheque amount to
complainant. Hence, this complaint.
Appearance of accused and his plea:
5] The particulars of offence was explained to accused
vide plea at Exhibit No.8. The accused did not plead guilty and
claimed to be tried.
6] As per provisions of section 143 of the Act, 1881
this case can be tried as a summary triable case. But this Court
has option to try it in summary manner or to try it in the
procedure laid down for summons trial case. As per section
262(1) of Criminal Procedure Code, 1973 read with section 143
of the Act, there is an option to the Magistrate to adopt the
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summary trial or not. The record of this court speaks that, this
case is tried as per the procedure of summons trial case. The
evidence of witness is recorded separately and in exhaustive
manner and not as laid down in section 263 of the Code of
Criminal Procedure, 1973.
Oral evidence of the complainant :
7] The complainant has examined herself at (Exh.9) as
C.W.1 and Bank witness Shri. Viral Maniyar-Branch Operation
Manager of Kotak Mahindra Bank at (Exh.51) as C.W.2. She has
closed her evidence vide pursis (Exh.63).
8] Documentary evidence of the complainant :
Documents Exhibit
Authority letter dated 06/04/2018 15
Invoices 16 to 20
Disputed cheques 21 to 23
Bank return memos 59 to 61
Demand notice 35
Postal receipt 24
Acknowledgment card 36
Reply given by accused dated
15/01/2018
26
Postal receipt 27
Acknowledgment card 28
Copy of I.D. of C.W.2 54
Authority Letter issued in favour of C.W.2 55
Bank Statement of complainant 56
Certificate u/s.65B of Indian Evidence
Act
57
Certificate u/s.2A of Banker’s Books
Evidence Act
58
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Examination of accused :
9] After the evidence of the complainant, statements of
accused under Section 313 of the Code of Criminal Procedure
has been recorded vide (Exh.41 and 72).
Argument of both side :
10] Heard Learned advocate for both sides at length.
Both advocate have placed their reliance on the following
citations :
11] Advocate for complainant referred following
rulings:
(i) APS Forex Services Pvt. Ltd., V/s. Shakti International
Fashion Linkers and ors [2020 ALL SCR (Cri.) 433];
(ii) Lalitha V/s. B.S. Somshekhar [Criminal Appeal NO.393 of
2016];
(iii) M/s. Kalamani Tex and anothers V/s. P. Balasubramanian
[20212 ALL SCR (Cri) 411];
(iv) VPK Urban Co-operative Cridit Society Limitd V/s. Mr/s.
Nandini Shankar Vaingade and another [2013 ALL MR (Cri.)
1204];
(v) Bir Singh V/s. Mukesh Kumar [2019 ALL SCR (Cri) 510];
(vi) K. N. Beena V.s, Maniyappan [2001 DGLS (Soft) 1312];
(vii) Rekha Mahindra Shah V/s. Gautam Umed Parmar and
another [2013 Cri. L.J. 2415];
(viii) P. Rasiya V/s. Abdul Nazer and another [2023 ALL MR
(Cri.) 399 (S.C.)];
(ix) Hiten P. Dalal V/s. Bratindranath Banerjee [2001 Cri. L.J.
4647].
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12] Advocate for accused placed reliance on the
following decisions :
(i) Shri. Vinay Parulekar V/s. Shri. Pramod Meshram [2008 ALL
MR (Cri) 461];
(ii) Supply House V/s. Ullas Proprietor Bright Agencies and
another [2006 Cri. L.J. 4330];
(iii) Arvind K. Pandya V/s. State of Maharashtra and another
[2008 ALL MR (Cri.) 471];
(iv) Regupathi V/s. Govindan and another [2006 Cri. L.J. 4332];
(v) Shrikrishna Shankar Shedge V/s. Satish C. Bhatewara and
another [2010 (1) Bom. C.R. (Cri.) 87];
(vi) Dr. Pradeep Mohanbay V/s. Mr. Minguel Carlos Dias [2000
Vol. 102(1) Bom L. R. 908];
(vii) V. Veeramani V/s. K. K. Palanisamy [2014 ALL MR (Cri)
Journal 3];
(viii) Smt. Vandana w/o. Akhilesh Pandey V/s. Smt. Abhilasha
w/o. Anil Pande [Criminal Appeal No.360 of 2017];
(ix) Shri. Madhusudan Shrikrishna V/s. M/s. Emkay Exports and
others [Criminal Application No.441 of 2007];
(x) Bennett Coleman & Co. Ltd., V/s. Mr. Mohan Coelho
[2328/SS/2016];
(xi) K. R. Indra V/s. Dr. G. Adinarayana [2003 (4) Mh. L.J.].
I have gone through the above judgments relied upon by both
sides. I have discussed ratio of relevant case laws and it's
applicability at the relevant place.
13] In view of all these discussions following points
arise for my determination and I have given my findings on
them with the reason stated below :
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Sr.No POINTS FINDINGS
1 Does the complainant prove the
authority of Anjana Parmar to file the
complaint and to adduce evidence ?
No
2 Does the complainant prove that,
accused issued disputed cheques in
favour of her firm for discharging
legally enforceable liability or debt?
Yes
3 Does the complainant prove that her
firm presented the cheques within
prescribed period for encashment and
they were dishonored for the reason
“Funds Insufficient”?
Yes
4 Does the complainant prove that her
firm issued statutory notice to the
accused within prescribed period and
the accused, in spite of receipt of it,
failed to pay the amount of disputed
cheques to her firm within stipulated
period?
No
5 What order ? Accused is
acquitted.
R E A S O N S
AS TO POINT NO. 1 :
14] Complainant has led her evidence vide affidavit of
examination-in-chief (Exh.9). She has reiterated all the
contentions of complaint in her affidavit of examination in chief.
She has given evidence that she is working as Senior Executive
in the complainant firm and has been authorized by
complainant to file the complaint and represent it in this
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proceeding by authority letter dated 06/04/2018. She is
conversant with the facts of present case from her personal
knowledge. In cross-examination, C.W.1 says that she is working
as Senior Executive with complainant. She was not associated
with the complainant between period 2014 to 2016. She says
that she was present for the meeting when the authority letter
(Exh.15) was signed. She says that she and one of the partner of
complainant by name Kiran Chitalaya were present for the
meeting. She says that she never met accused personally and did
not make communication with accused about disputed cheques.
She says that she is authorized to represent matter related to the
disputed cheques mentioned in authority letter (Exh.15).
15] Perused authority letter (Exh.15). It reflect from
same that C.W.1 was authorized to represent complainant firm
in criminal complaint to be filed against accused in respect of
dishonour of cheque bearing Nos.010321, 010322 and 010323.
Present case is filed in respect of dishonour of cheque
Nos.10826, 10827 and 10828. C.W.1 has also clearly mentioned
in her cross-examination that she was authorized to represent
the matter related to the cheques mentioned in authority letter
(Exh.15). There is difference in number of cheque mentioned in
the complaint and in the authority letter. Therefore, I find that
C.W.1 has no authorization to file and adduce evidence on
behalf of complainant in respect of cheques in dispute. So, I hold
that complainant has failed to prove authority of Anjana Parmar
to file the complaint and adduce evidence. As such, I answer
point No.1 as “No”.
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AS TO POINT NO. 2 :
16] Section 138 of N.I. Act provides that the drawer of
the cheque is deemed to have committed the offence, if the
following ingredients among other ingredients are fulfilled :
(i) Accused drawn a cheque on an account maintained by him
with a banker for the payment of any amount of money to
another person.
(ii) The cheque is drawn for the discharge of the ‘whole or part’
of any debt or other liability. ‘Debt or other liability’ means
legally enforceable debt or other liability.
17] C.W.1 affirmed that complainant deals in the supply
of chemical and solvents and it is authorized distributor of some
famous brand in it. She says that accused is proprietor of
proprietorship firm by name M/s. Aristo (INDIA) Corporation.
Accused used to place purchase order of goods with the
complainant. She testifies that in the ordinary course of business
complainant sold, supplied and delivered Hydrogen Peroxide
under various bills and invoices. There was total outstanding of
Rs.1,65,232/- from accused towards the invoice Nos.82, 85,
134, 161 and 272. She has given evidence that accused towards
payment of bill of said invoices, issued three cheques bearing
No.010321, 010322 and 010323 of Rs.82,680/-, Rs.41,340/-
and Rs.41,212/- respectively of his bank account in favour of
complainant. She has given further evidence that said cheques
were dishonoured when presented for encashment. Her firm
issued demand notice dated 25/09/2017 calling upon accused
to make the payment of said cheques. She says that accused
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received notice and replied the same on 15/01/2018 by raising
false contentions. She affirms that alongwith the said reply
accused issued three fresh cheques bearing No.10826, 10827
and 10828 of Rs.82,680/-, Rs.41,340/- and Rs.41,212/-
respectively of his bank account in favour of complainant.
18] Advocate for complainant has canvassed submission
that oral evidence of complainant is corroborated by
documentary evidence. He has submitted that accused while
giving reply to first demand notice of complainant admitted that
he had placed purchase order and issued P.D.C. cheques. He has
also submitted that accused did not raise any objection after
receiving the goods. He has next submitted that defence taken in
cross-examination and notice reply are not consistent. He has
further submitted that accused has not examined himself nor
any witness to prove his defence. He has also submitted that
there are statutory presumption under Section 118 and 139 of
N.I. Act , arisen in favour of complainant. He has further
submitted that complainant has proved her case against accused.
He prays to convict the accused.
19] C.W.1 in her cross-examination says that she made
communication with accused prior to and after disputed
cheques. She further states that she never spoke to accused but
had communication with Hitesh Darji. She states that purchase
orders were in writing. She says that complainant has three
godowns and there are godown keepers deputed there. She says
that they are not employees of complainant. She states that
godown keepers had supplied the goods to the accused. She says
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that acknowledgment were not received after supply of goods.
She denies suggestion that goods were not supplied to the
accused hence, there was no acknowledgment received from
accused. She states that tax invoices (Exh.16 to 20) were
prepared by account department on the basis of purchase order.
She admits that tax invoices do not have acknowledgment of
accused. She has denied suggestion that tax invoices are forged
and fabricated. She says that cheques (Exh.21 to 23) were
received by complainant in January 2018 through it’s peon. She
admits that signature and other contents are in two different
handwriting. She denies suggestion that she did not see the
disputed cheques before they were deposited in the bank for
clearance. She denies suggestion that accused had given blank
cheques for security purpose. She denies suggestion that
complainant did not deliver goods to the accused hence, she was
not entitled to deposit the cheques in the bank. She denies
suggestion that contents of cheque were written by staff of
complainant. She shows ignorance as to who handed over
disputed cheques to the peon of complainant. She admits that
accused had replied to the first demand notice issued by the
complainant. She denies suggestion that vide said reply accused
made request to return cheques . She could not state whether
initial three cheques are still with the complainant or not. She
states that accused had sent only reply (Exh.26) to the
complainant and it was not accompanied with any document.
She says that as the tax invoices are filed with purchase order on
record, ledger account of accused is not produced on record. She
could not state what happened in respect of initially
dishonoured three cheques. She could not state whether said
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cheques were return back to the accused or not. She denies
suggestion that initially dishonoured three cheques and cheques
in dispute were issued by accused as security. She says that
complaint is filed against M/s. Aristo (INDIA) Corporation
through proprietor Jayanti Shah. She denies suggestion that
complaint is not filed against proprietor. She admits that accused
had transaction with complainant prior to disputed transaction.
She further admits that he had paid all amount of previous
transaction prior to disputed transaction.
20] Heard advocate for accused. He has canvassed
submission that C.W.1 is not partner of complainant firm. He
submits that proprietor is not made party to the complaint. He
further submits that previous cheques are with complainant. It is
further submitted by him that goods mentioned in the complaint
are not supplied to the accused. It is also submitted that there is
no proper verification to the complaint. It is also his submission
that complainant has not produced books of account and so
called delivery challan. He further submits that authority letter
(Exh.15) is not respect of cheques in question and it is defective.
It is also his submission that instead of authority letter, Power Of
Attorney was required to be given to C.W.1. He submits that so
called purchase order are not produced on record by
complainant and it has not produced sufficient proof to show
that the goods were supplied to the accused. It is also submitted
by him that while giving reply to first demand notice, accused
had asked complainant to return his cheques. He submits that
complainant has failed to prove her case against accused. Hence,
he prays to acquit the accused.
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21] Section 139 of N.I.Act provides that, it shall be
presumed unless the contrary is proved, that the holder of the
cheque received the cheque of the nature referred to in section
138 of N.I. Act. for the discharge in whole or in part, of any debt
or liability. In view of the section, it is incumbent upon the court
to presume that the cheque issued was in discharge of the debt.
Negotiable Instruments Act lays down special rule of evidence
and certain special presumption and preclude certain plea being
raised in particular circumstances. There is presumption under
section 118 of N.I. Act that, the consideration has passed for
execution of Negotiable Instruments. Said presumption is
rebuttable one. Accused can rebut the presumption by putting
his defence up to the test of preponderance of probability.
22] It reflect from defence of accused that it is his
stance that he had issued the blank cheques as security to the
complainant. It becomes clear that it is not disputed position
that cheques (Exh.21 to 23) were of bank account of accused
and they were signed by him. In the context of this position,
presumption provided under Section 118 and 139 of Negotiable
Instruments Act have arisen in favour of complainant.
23] It is settled position of law that standard for rebuttal
of presumption under Section 139 is of preponderance of
probabilities and for such rebuttal inference can be drawn not
only from the material brought on record by the parties, but also
from the circumstances relied upon by them.
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24] In Vinay Parulekar (supra) the Hon’ble Panji Bench
of Bombay High Court has ruled that presumption provided in
under Section 139 of N.I. Act can be rebutted either by leading
evidence or bringing facts of record in cross-examination of
complainant which would make case of complainant im-
probable.
25] In Arvind Pandya (supra) the Hon’ble Bombay High
Court had held that statutory presumption under N.I. Act can be
rebutted by cross-examining the complainant.
26] In Supply House (supra) the Hon’ble Kerala High
Court has observed that in case of non supply of goods by the
complainant, accused does not incur any liability towards
complainant.
27] In Shrikrishna Shedge (supra) the Hon’ble Bombay
High Court has confirmed the order of Trial Court acquitting the
accused by holding that complainant did not prove the delivery
of goods effected since delivery challan duly signed by the
accused was not produced. It also observed that the cheque
remained to be cheque of security without consideration passed.
28] In Pradeep Mohanbay (supra) the Hon’ble Bombay
High Court has observed that cognizance of offence under
Section 138 of N.I. Act cannot be taken except on complaint of
payee or holder in due course. It also held that complainant can
appoint power of attorney for filing the complaint. It also held
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that neither Cr.P.C. nor N.I. Act contemplates that anyone can
depose for and on behalf of the complainant. It also held that in
such complaint power of attorney is entitled to appear as a
witness and depose in respect of facts which are within his
knowledge and on the basis of record on which reliance is
placed.
29] In Veeramani (supra) the Hon’ble Madras High
Court has held that when accused denies any connection with
complainant and the cheque reflect that the signature of accused
is in one and all other writings are in another, the burden to
prove alleged debt passes on complainant.
30] In Madhusudan Shrikrishnana (supra) the Hon’ble
Bombay High Court had confirmed the dismissal of the order of
complaint of Trial Court by observing that no reason was made
out for reconsideration of reasoning set out by Trial Court in
support of acquittal order.
31] In APS Forex Services (supra) the Hon’ble Supreme
Court held that, when accused admits the signature on the
cheque, there is presumption under Section-139 of the N.I. Act,
in favour of the complainant. Where it is a defence that cheque
was issued as security, would not extricate accused from
discharge of liability arising out of cheque. Accused may adduce
evidence to rebut the presumption, but mere denial regarding
existence of debt shall not serve any purpose. Accused is
required to lead evidence to prove that disputed cheque was
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given as security. In absence of evidence it is not believable to
rebut the presumption. Once, the signature on the cheque is
admitted, there is always presumptions in favour of complainant
that, there exist legally enforceable debt or liability and
thereafter, it is for the accused to rebut such presumption by
leading evidence.
32] In Lalitha (supra) the Hon’ble Supreme Court held
that, if the signature on the cheque is admitted to be that of
accused, the presumption envisaged under Section 118 of N. I.
Act, can be legally inferred that, the cheque was made or drawn
for consideration on the date which the cheque bears. In such a
case, it is for the accused to show that he had not taken said
amount and also to explain the circumstances under which the
cheques were issued.
33] In M/s. Kalamani (supra) the Hon’ble Supreme
Court held that once signature on cheque is admitted, obligation
shifts upon accused to discharge the presumption imposed upon
him.
34] In V.P.K. Urban (supra) the Hon’ble Panji bench of
Bombay High Court has held that when accused alleges that the
cheque was for amount more than due by him and the execution
of cheque is not denied. Bare suggestion that the blank cheques
were obtained from accused as security and the complainant
was not entitled to deposit the same without intimation to the
accused are not at all sufficient to rebut the presumption under
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Section 118 and 139 of N.I. Act. It has further held that even if
the cheque is issued as security, complaint lies under Section
138 of N. I. Act.
35] In Bir Singh (supra) the Hon’ble Apex Court held
that presumption under Section-139 of the N.I. Act is that
holder of the cheque received the cheque towards the discharge
of any debt or liability. Onus is on the accused to rebut the
presumption by proving that cheque was not issued towards
discharge of any debt or liability. It has also held that cheques
might be a post dated cheques. It does not absolve drawer of the
cheque of penal consequences under Section 138 of N.I. Act. It
is also immaterial that cheque may have been filled in by any
person other than drawer, if the cheque is duly signed by the
drawer. It also held that even a blank cheque leaf voluntarily
signed and handed over by the accused towards some payment,
would attract presumption under Section 138 of N.I. Act in the
absence of any cogent evidence to show that cheque was not
issued in discharge of debt.
36] In K. N. Beena (supra) the Hon’ble Apex Court held
that under Section-118 of the N.I. Act, unless the contrary is
proved, it is to be presumed that, the negotiable instruments
(including cheque) had been made or drawn for consideration.
Under Section-139 of the N.I. Act, Court has to presume, unless
the contrary is proved, that the holder of the cheque received
the cheque for discharge, in whole or in part, of debt or liability.
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37] In P. Rasiya (
supra) the Hon’ble Supreme Court has
laid down that presumption under Section 138 of N.I. Act is
statutory presumption and thereafter, once it is presumed that
cheque is issued in whole or part of any debt of liability which is
in favour of the complainant / holder the cheque, in that case, it
is for the accused to disprove the contrary.
38] In Hiten P. Dalal (supra) the Hon’ble Apex Court
held that it is obligatory on the Court to raise this presumption
in every case where the factual basis for raising of the
presumption had been established. It introduced an exception
to the general rule as to the burden of proof in criminal cases
and shifts onus on the accused. Such presumption is
presumption of law, as distinguished from presumption of fact
which describes provisions by which the Court “may presume”
certain state of affairs. Presumptions are rules of evidence and
do not conflict with presumption of innocence, because by the
later all that is meant is that, the prosecution is obliged to prove
the case against accused beyond reasonable doubt. The
obligation on the prosecution may be discharged with the help
of presumption of law or fact, unless the accused adduces
evidence showing the reasonable possibility of the non existence
of the presumed fact.
39] It is admitted position that accused had transaction
with complainant prior to disputed transaction. Though C.W.1
has admitted that accused sent reply to the complainant without
accompanying any document, considering the suggestion given
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to C.W.1 in cross-examination it is crystal clear that accused had
issued in all six cheques. As per defence stand, they were issued
as a security. He has not explained the circumstances under
which cheques in dispute were issued to the complainant. Had
he issued cheques in question prior to replying demand notice,
he would have specifically mentioned number of said cheques
and would have claimed it back from complainant. It is evident
that he had replied to initial demand notice of complainant
regarding cheque No.010321, 010322 and 010323. Accused in
his reply in Para-2 has admitted that he had placed various
purchase order to the complainant. It is his reply that he had
handed over cheque Nos.010321, 010322 and 010323 as a
security while placing purchase order on the request of
complainant. It is also his reply that complainant failed to supply
entire goods as per quality and quantity in purchase order. Said
reply is of 15/01/2018. Had there been any misuse of previous
and present cheques by the complainant, accused would have
taken legal action against complainant for the same. However,
he has not done so. Though it is defence stand that contents of
cheques were not written by him, considering the dictum laid
down in Bir Singh (supra), said stand remains no force. Second
submission made by defence counsel is that non arraying Jain
Shah as separate accused is fatal to complainant’s case. It is
settled position that proprietary concern has no separate legal
existence. In title clause, the complaint Jayanti Shah is shown as
proprietor of M/s. Aristo (INDIA) Corporation. In complaint
filed against proprietary concern, it can be shown as accused
represented by proprietor. Therefore, submission of defence
counsel holds no water in that regard.
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CNR No.MHMM19-005093-2018
40] Oral evidence of C.W. 1 coupled with documentary
evidence i.e. cheques and reply notice etc. , that accused issued
cheques in question towards outstanding bill amount is not
shaken in her cross-examination. I find that accused has
unsuccessful to rebut the statutory presumptions upto test of
preponderance of probability. As such I hold that, complainant
has proved point No.2. So I answer it as “Yes”.
AS TO POINT NO.3:
41] C.W. 1 has given evidence that she deposited
cheques (Exh.21 to 23) for encashment with her banker for
realization i.e. Kotak Mahindra Bank, Vile Parle branch, Mumbai
on 26/03/2018 and the same were returned with remark “Funds
Insufficient” on 27/03/2018.
42] Viral (C.W.2 ) is a Branch Operation manager from
Kotak Mahindra Bank, Mumbai. He has given evidence that he
has been given authority (Exh.55) by his bank to produce
document on record and to depose in the matter. He has
produced his I.D. Card (Exh.54) on record to show that he is
serving in Kotak Manindra Bank. It is his evidence that
complainant has bank account in his bank. He has produced on
record bank statement of complainant for the period
16/11/2013 to 28/11/2021 which is at (Exh.56). He has
produced certificate under Section 65B of the Evidence Act
(Exh.57) and certificate under Section 2A of Banker’s Book
Evidence Act (Exh.58) in support of said statement. He has
further produced on record bank memos of disputed cheques.
He states that the cheques were dishonoured for the reason
‘Funds Insufficient’. The bank memos are at (Exh.59 to 61).
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CNR No.MHMM19-005093-2018
43] C.W.1 in her cross-examination says that cheque
(Exh.21 to 23) were deposited in the bank only once and they
were dishonoured for the reason ‘Funds Insufficient’. She further
states that cheque return memos were issued by bank. She also
states that the cheques were collected by peon of complainant,
from bank. She denies suggestion that accused had given
instruction to the bank to stop the payment. She says that for
one cheque they had received intimation about stop payment
but at that time all three cheques were already sent to the bank.
44] C.W.2 in his cross-examination states that he is
serving in Kotak Mahindra Bank, branch- Irla from last two
months and he joined said bank prior one year. He states that
current maintained by complainant with his bank is closed, but
he do not know the date of same. He says that case number of
present case is not mentioned in authority letter (Exh.55)
executed in his favour. He says that he took print out of letter
from his department and put signature and stamp of bank on it.
He states that cheque return memos were delivered through
courier by clearing team.
45] It is opt to refer here Section 146 of N.I. Act which
provides that the Court shall in respect of every proceeding
under this Chapter, on production of bank’s slip or memo having
thereon the official mark denoting that the cheque has been
dishonoured, presume the fact of dishonour of such cheque,
unless and until such fact is disproved.
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CNR No.MHMM19-005093-2018
46] In Vandana (supra) the Hon'ble High Court has held
in Para No.14 that mere statement made in the statutory notice
and complaint filed before the Court ,would not constitute proof
of dishonor of cheque, unless further evidence to corroborate
the same was placed on behalf of the complainant. It has also
held that it is for the complainant to prove the fact of dishonour
of cheque by cogent evidence. It has further held that one of the
mode of proving dishonour of cheque is provided in Section 146
of N.I. Act. In said case, cheque return memo was not bearing
official mark of the bank. Therefore, the Hon'ble High Court
held that basic fact of dishonour of cheque was not proved by
the complainant.
47] It is settled principle of law that complainant has to
prove his case on his own leg. Contentions of complainant that
the cheques were presented for encashment and they were
dishonoured for the reason ‘Funds Insufficient’ are remained
unchallenged. Cheque return memos (Exh.59 to 61) bears
signature of bank official and the same denotes that the cheques
have been dishonoured. Her evidence on said aspect gets
corroboration from cheque return memos (Exh.59 to 61) and
evidence of C.W.2. Factum of dishonour of cheques is
corroborated by the evidence of C.W.1. Considering the line of
cross-examination of C.W.1 , it becomes clear that fact of
dishonour of cheques is not dipsuted by accused. In Vandana
Pandey (supra) cheque return memo was not having official
mark of bank. In present case also the cheque return memos do
not have official mark of bank however, Complainant has
examined C.W.2 and proved the fact of dishonour of cheques.
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CNR No.MHMM19-005093-2018
Therefore, the ruling in Vandana Pandey (supra) is not
applicable to present case.
48] Considering the date on the cheques (Exh.21 to 23),
date of it's deposit and date of it’s return mentioned on memos
(Exh.59 to 61), it appears that cheques were deposited within
stipulated period i.e. three months for clearance. It also appears
from cheque return memos (Exh.59 to 61) and evidence of
C.W.2 that the cheques were dishonoured for the reason
mentioned in the complaint.
49] In view of the oral as well as documentary evidence
referred supra, it is established that, the cheques were presented
for encashment within prescribed period and they were
dishonored for the reason “Funds Insufficient”. Therefore, I
answer point No.3 as “Yes”.
AS TO POINT NO.4 :
50] Complainant has given evidence that she got
knowledge about dishonor of cheques on last occasion on
27/03/2018. It is her evidence that, she issued demand notice
(Exh.35) dated 02/04/2018 to accused demanding amount of
the cheque. She says that said notice was received by accused on
04/04/2018 vide R.P.A.D. acknowledgment card (Exh.36). She
says that accused in-spite of receipt of notice, failed to pay
amount of the cheques to her firm within a stipulated period.
51] In Cross-examination C.W.1 admits that
complainant had issued demand notice dated 25/09/2017 in
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(24) CC. No.1951/SS/2018 [Judg.]
CNR No.MHMM19-005093-2018
respect of dishonor of cheque No.010321, 010322 and 010323.
She also admits that accused had replied said notice vide reply
(Exh.26) on 15/01/2018. She says that she personally had not
given instructions about contents of demand notice sent to the
accused. She says that notice (Exh.35) is office copy. She says
that said notice was sent to the accused on the say of owner. She
says that the notice bears signature of advocate. It does not bear
her signature or signature of any partner. She says that
acknowledgment card (Exh.36) is of demand notice (Exh.35),
She admits that acknowledgment (Exh.36) further shows service
of notice on accused. She further says that acknowledgment
card (Exh.36) is of second notice. She denies suggestion that
acknowledgment (Exh.36) is forged one. She also denies
suggestion that notice (Exh.35) was not served on accused
hence, he could not reply to it. She admits that in a notice
(Exh.35) complainant has demanded total amount payable by
accused and not the disputed cheques.
52] In Rekha Shah (supra) demand notice was
addressed to the accused and it was delivered to his address. In
that case address of accused mentioned in the complaint in
demand notice and on acknowledgment card were identical.
Summons in the said case was issued on same address.
Acknowledgment was signed by husband of accused. In that
case Hon’ble Bombay High Court held that merely because
acknowledgment was signed by husband of accused ,it would
not mean that demand notice was not served.
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CNR No.MHMM19-005093-2018
53] In present case, C.W.1 admits that she personally
had not given instructions to her advocate about contents of
demand notice and it does not bear her signature or signature
of any partner. Accused has taken stance that demand notice
was not sent and served on him. In such a case, considering the
admission given by C.W.1 in her cross-examination, doubt arises
as to who gave instruction to the concerned advocate to draft
demand notice. Complainant has not examined any of it’s
partner to show that they had instructed advocate to draft
demand notice (Exh.35) or concerned advocate to show that he
had instruction from complainant to draft and issue said notice.
Merely producing office copy of notice would not absolve
complainant from proving the notice and it’s contents.
Considering the evidence on record, I find that complainant has
failed to prove it had issued demand notice regarding dishonour
of cheques in question to the accused demanding amount of
cheques. Therefore, I answer point No.4 as “No”.
AS TO POINT NO.5:
54] In view of finding recorded against point Nos.1 to 4
I am of the considered opinion that complainant has failed to
prove all the essential ingredients of Section 138 of N.I. Act. As
such accused is entitled to acquittal. Thus, in answer to point
No.5 following order is passed :
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CNR No.MHMM19-005093-2018
O R D E R
(1) Accused is acquitted of the offence punishable under
section 138 of Negotiable Instruments Act vide
Sec.255(1) of the Code of Criminal Procedure.
(2) His bail bonds stands cancelled.
(3) He is directed to furnish P.B and S. B. of Rs.7,500/- as
per section 437A of Cr. P.C.
Date : 01/04/2025
Shri. R. D. Dange
Judicial Magistrate, First Class
63rd Court, Andheri, Mumbai.
Dictated on : 01/04/2025
Transcribed on : 01/04/2025
Signed on : 11/04/2025
pkk
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