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2022 DIGILAW 1399 (ALL)

Shriram Balaji v. State of U. P.

2022-09-02

MANJU RANI CHAUHAN

body2022
JUDGMENT : Manju Rani Chauhan, J. 1. Heard Mr. C.L. Pandey, Senior Advocate assisted by Mr. Durlabh Kumar Pandey, learned counsel for the applicants and Mr. Amit Singh Chauhan, learned AGA for the State and perused the records. 2. The present application under Section 482 Cr.P.C. has been filed to quash the summoning order dated 31.03.2021 as well as the entire proceedings of Complaint Case No.5442 of 2020 (Sanjit Mishra Vs. M/s Shriram Balaji Traders), under Section 138 of Negotiable Instruments Act, 1881, pending in the Court of the Additional Civil Judge (J.D.)/ Judicial Magistrate, Jhansi. 3. Brief facts of the case are that the opposite party no.2 filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as 'the Act') against the applicant with the allegation that the applicant having good relations with opposite party no.2, borrowed an amount of Rs. 4 lacs from the opposite party no.2 and to discharge his liability gave a cheque bearing No.264555 of State Bank of India, Branch Mandi Samiti, Jhansi of his firm M/s Shriram Balaji Traders having its account No.MCA 32292826933 dated 28.02.2020. The aforesaid cheque was presented before the District Cooperative Bank, Branch Manikchowk, Jhansi for encashment, however, the same was returned on 04.03.2020 without payment with a remark "other reasons". Thereafter, the opposite party no. 2 approached the applicant informing about the return of the check without payment and requested him to pay the amount as taken by him, on which, assurance was given by the applicant that he would contact the bank, after which, the opposite party no.2 may present the cheque for encashment. On the aforesaid verbal assurance, the cheque was presented for the second time on 07.02.2020 before the District Cooperative Bank, Branck Manikchowk, Jhansi for encashment, however, the same was returned on 09.03.2020 without payment. Thereafter, on 18.03.2020, a legal notice was sent to the applicant through advocate by registered post. Thereafter, as there was lockdown from 24.03.2020, therefore, the opposite party no.2 could not receive the information of postal details. After the lockdown was over, on 29.05.2020, the opposite party no.2 sent a letter to the senior postal superintendent, Jhansi enquiring about the service of notice and he was informed that the aforesaid notice has been served at the address mentioned on 19.03.2020. After the lockdown was over, on 29.05.2020, the opposite party no.2 sent a letter to the senior postal superintendent, Jhansi enquiring about the service of notice and he was informed that the aforesaid notice has been served at the address mentioned on 19.03.2020. Thereafter, after the notice neither any amount was paid nor reply was submitted by the applicant, therefore, the present compliant has been filed on 18.06.2020. Subsequently, the learned Magistrate after recording the statement under Sections 200 and 202 Cr.P.C. summoned the applicant vide order dated 31.03.2021, under Section 138 of the Act. 4. Learned counsel for the applicants submits that the applicant no.2 had good relations with the opposite party no.2 and the opposite party no.2 was interested to purchase a portion of residential house of the mother of applicant no.2. In this regard, a registered agreement for sale was entered between the opposite party no.2 and mother of applicant no.2 on 08.10.2013. A sale deed was to be executed by the mother of applicant no.2 in favour of opposite party no.2 within a period of two years after payment of the consideration as agreed. As only Rs. 1,00,000/- was paid and rest of the amount could not be paid, therefore, by mutual understanding between the parties another registered agreement was executed between them on 07.10.2015. The opposite party no.2 did not pay the amount as agreed within the stipulated period, therefore, the present case has been instituted with mala fide intentions, in order to extract money from the opposite party no.2. 5. Learned counsel for the applicants further submits that as the opposite party no.2 used to come at the applicants' place, a signed cheque was stolen from his drawer and the same has been used for filing the present case under Section 138 of N.I. Act, therefore, no proceedings under the relevant section of the Act is made out against the applicant. He further submits that the complaint does not mention the details as to how the opposite party no.2 managed Rs.4 lacs, to be given to the applicant. He further submits that though, the opposite party no. He further submits that the complaint does not mention the details as to how the opposite party no.2 managed Rs.4 lacs, to be given to the applicant. He further submits that though, the opposite party no. 2 has sent a notice dated 18.03.2020, but the service of notice has not been effected and, therefore, the complaint which has been filed on 18.06.2020, is not maintainable as the time period of 15 days cannot be calculated as to when the notice has been given to opposite party no. 2. Under the circumstances, pre-condition as contained under Section 138 N.I. Act has remained uncomplied with and, therefore according to him, proceedings are clearly not maintainable under the Negotiable Instruments Act, 1881. He further submits that there is no specific averment as to how the notice has been served upon the applicants, however, the summoning order has been passed in a mechanical manner without mentioned the mode/manner of service of notice. Hence, the same is liable to be quashed. 6. On the other hand, Mr. Amit Singh Chauhan, learned AGA for the State, submitted that it is not necessary to mention in the complaint that notice of demand was served on the accused on any given date. He further submits that once it is mentioned in the complaint that notice was dispatched under the registered cover, on the address of the accused which has not been stated to be incorrect, there would be a presumption in law with regard to service of notice. The summoning order passed by the concerned Magistrate is legal and just in the eyes of the law and at this stage, only a prima facie case is to be seen and the complaint cannot be thrown at the threshold. 7. So far as the other submission as raised by learned counsel for the applicant regarding stolen cheque, learned AGA submits that if the cheque was stolen, the applicant should have given information for the same to the Bank and also lodged an FIR regarding loss of the check. However, there is nothing on record to show that the cheque was stolen. Therefore, the learned Magistrate concerned has not committed any illegality in summoning the applicant. On the cumulative strength of the aforesaid, learned AGA for the State submits that the present application is liable to be dismissed. 8. However, there is nothing on record to show that the cheque was stolen. Therefore, the learned Magistrate concerned has not committed any illegality in summoning the applicant. On the cumulative strength of the aforesaid, learned AGA for the State submits that the present application is liable to be dismissed. 8. I have carefully considered the submissions advanced by learned counsel for the parties and have also gone through the material available on record. 9. Before proceeding to consider the respective submissions of learned counsel for the parties, it is useful to extract the provisions of Section 138 of the Act, which is as under:- "138. Dishonor of cheque for insufficiency, etc., of funds in the accounts:- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any 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, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honor the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both: PROVIDED that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier. (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer of the cheque, within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid, and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation: For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability." 10. The aforesaid section deals with a cheque drawn by a person "for the discharge, in whole or in part, of any debt or other liability." The section does not say that the cheque should have been drawn for the discharge of any debt or other liability of the drawer towards the payee. Thus in complaint under Section 138 of N.I. Act, the Court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or liability is on the accused. The applicant being holder of cheque and the signature appended on the cheque having not been denied by the Bank, presumption shall be drawn that cheque was issued for the discharge of any debt or other liability. The presumption under Section 139 is a rebuttable presumption. Before this Court refers to various judgments of the Apex Court considering Sections 118 and 139, it is relevant to notice the general principles pertaining to burden of proof on an accused especially in a case where some statutory presumption regarding guilt of the accused has to be drawn. 11. A Three Judges' Bench of the Hon'ble Apex Court in the case of C.C. Alavi Haji Vs. Palapetty Muhammed and Another, reported in (2007) 6 SCC 555 , has held as under:- "14.Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. 11. A Three Judges' Bench of the Hon'ble Apex Court in the case of C.C. Alavi Haji Vs. Palapetty Muhammed and Another, reported in (2007) 6 SCC 555 , has held as under:- "14.Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement refused or not available in the house or house locked or shop closed or addressee not in station, due service has to be presumed. [Vide Jagdish Singh Vs. Natthu Singh, [ AIR 1992 SC 1604 ]; State of M.P. Vs. Hiralal & Ors., [ (1996) 7 SCC 523 ] and V.Raja Kumari Vs. P.Subbarama Naidu & Anr., [(2004) 8 SCC 774]. It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved. 17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is no stipulation of giving of a notice before filing a complaint. 17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskaran case, if the "giving of notice" in the context of Clause (b) of the proviso was the same as the "receipt of notice" a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of Section 138 of the Act." 12. It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, the service of notice is deemed to have been effected at the time, at which the letter would have been delivered in the ordinary course of business. In the judgment of the Apex Court in the case of Ajeet Seeds Ltd. vs. K. Gopala Krishnaiah, reported in 2014 12 SCC 685 , the Apex Court has held that absence of averments in the complaint about service of notice upon the accused is the matter of evidence. The paragraph nos. 11 and 12 of the said judgement are reproduced herein below:- "10. The paragraph nos. 11 and 12 of the said judgement are reproduced herein below:- "10. It is thus clear that Section 114 of the Evidence Act enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. Section 27 of the GC Act gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. It is not necessary to aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. 11. Applying the above conclusions to the facts of this case, it must be held that the High Court clearly erred in quashing the complaint on the ground that there was no recital in the complaint that the notice under Section 138 of the NI Act was served upon the accused. The High Court also erred in quashing the complaint on the ground that there was no proof either that the notice was served or it was returned unserved/unclaimed. That is a matter of evidence. We must mention that in C.C. Alavi Haji, this Court did not deviate from the view taken in Vinod Shivappa, but reiterated the view expressed therein with certain clarification. We have already quoted the relevant paragraphs from Vinod Shivappa where this Court has held that service of notice is a matter of evidence and proof and it would be premature at the stage of issuance of process to move the High Court for quashing of the proceeding under Section 482 of the Cr.P.C. These observations are squarely attracted to the present case. The High Court's reliance on an order passed by a two-Judge Bench in Shakti Travel & Tours is misplaced. The order in Shakti Travel & Tours does not give any idea about the factual matrix of that case. It does not advert to rival submissions. It cannot be said therefore that it lays down any law. The High Court's reliance on an order passed by a two-Judge Bench in Shakti Travel & Tours is misplaced. The order in Shakti Travel & Tours does not give any idea about the factual matrix of that case. It does not advert to rival submissions. It cannot be said therefore that it lays down any law. In any case in C.C. Alavi Haji, to which we have made a reference, the three-Judge Bench has conclusively decided the issue. In our opinion, the judgment of the two-Judge Bench in Shakti Travel & Tours does not hold the field any more." 13. Further the Apex Court in Bharat Barrel & Drum Manufacturing Company Vs. Amin Chand Pyarelal, reported in (1999) 3 SCC 35 had considered Section 118(a) of the Act and held that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable and defendant can prove the non-existence of a consideration by raising a probable defence. In paragraph No.12 following has been laid down:- "12. Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non-existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118(a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist......" 14. In its latest judgment, the Apex Court in the case of Basalingappa Vs. Mudibasappa reported in (2019) 5 SCC 418 , specifically in paragraph nos. -23 and 24 has noticed as follows:- "27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant-accused cannot be expected to discharge an unduly high standard of proof." 23. No evidence was led by the accused. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the defendant-accused cannot be expected to discharge an unduly high standard of proof." 23. No evidence was led by the accused. The defence taken in the reply to the notice that cheque was stolen having been rejected by the two courts below, we do not see any basis for the High Court coming to the conclusion that the accused has been successful in creating doubt in the mind of the Court with regard to the existence of the debt or liability. How the presumption under Section 139 can be rebutted on the evidence of PW 1, himself has not been explained by the High Court. 24. The above Kishan Rao case was a case where this Court did not find the defence raised by the accused probable. The only defence raised was that cheque was stolen having been rejected by the trial court and no contrary opinion having been expressed by the High Court, this Court reversed the judgment of the High Court restoring the conviction. The respondent cannot take any benefit of the said judgment, which was on its own facts." (Emphasis added) 15. The matter regarding stolen cheque has already been dealt by this Court in the case of Ranjit vs. State of U.P. and another decided on 31.01.2020 passed in Application U/s 482 No. 47282 of 2019. 16. In view of the settled legal position, as noticed above, it is clear that the complaint cannot be thrown at the threshold even if it does not make a specific averment with regard to service of notice on the drawer on a given date. In the complaint itself, it has been mentioned about the letter of the senior postal superintendent, Jhansi, which goes to show that the notice has been served at the address mentioned on 19.03.2020, therefore, it cannot be said that the notice has not been served. The factum of disputed service of notice requires adjudication on the basis of evidence and the same can only be done and appreciated by the trial court. 17. The factum of disputed service of notice requires adjudication on the basis of evidence and the same can only be done and appreciated by the trial court. 17. As regards the submission made by learned counsel for the applicants regarding the facts that the cheque was stolen, the Court is of the opinion that if the cheque was stolen, the applicant should have given information for the same to the Bank and also lodged an FIR regarding loss of the check. However, there is nothing on record to show that the cheque was stolen and the information regarding missing of cheque was also not given to the bank. However, after nearly one year, on 18.03.2022, when opposite party no.2 came to know about the said complaint under Section 138 of N.I. Act, he sent a letter to the bank regarding missing of check book, but neither the details of check has been mentioned nor any complaint has been made regarding the same earlier. All the submissions made by learned counsel for the applicant is disputed questions of fact. Therefore, when the facts have to be established by way of evidence, this Court while exercising the powers under section 482 of Cr.P.C., cannot interfere with such proceedings. Hence, no grounds are made out for quashing of the proceedings under section 138 of the Negotiable Instruments Act. 18. On the basis of discussions made herein above, this Court finds that there is no illegality or infirmity in the summoning order dated 31.03.2021 passed by the concerned court below. Therefore, no interference is required at this stage. 19. In view of the aforesaid, the application is, accordingly, dismissed.