Delhi District CourtThrough: Mr. S.K. Singh vs Joseph P A ..........Accused on 24 November, 2022IN THE COURT OF MS. AAKANKSHA, METROPOLITAN\n            MAGISTRATE, (NI ACT)­07\nSOUTH­WEST DISTRICT, DWARKA COURTS, NEW DELHI\n\n\n\nCt. Case No. 12406 of 2019\nCNR No. DLSW02­016773­2019\n\n\n\nP A Joseph                                 .........Complainant\n\n                                      Through: Mr. S.K. Singh, Advocate\n\n                             Versus\n\nJoseph P A                                 ..........Accused\n\n                                 Through: Mr. Alex Joseph, Advocate\n\n\n\n\n    (1)    Name of the complainant      P A Joseph, Proprietor of M/s\n                                        Maggie Prints\n\n                                        R/o A­1/12, Chanakya Place,\n                                        Part­I, Street No. 10, C­1,\n                                        Janakpuri, New Delhi­59\n\n    (2)    Name of the accused          Joseph P A\n\n                                        R/o D­II/145 & 146, First\n                                        Floor, Jeevan Park, Janakpuri,\n                                        New Delhi­59\n\n    (3)    Offence complained of or Section 138 Negotiable\n           provedInstruments Act, 1881(4)    Plea of accused              Pleaded not guilty\n\n    (5)    Date of institution of case 04.04.2019\n\n\n\n Ct. Case No. 12406/2019                                          Page 1 of 33\n      (6)   Date of conclusion of     17.11.2022\n           arguments\n\n     (7)   Date of Final Order       24.11.2022\n\n     (8)   Final Order               ACQUITTAL\n\n\n\n\n                            JUDGMENT1.            The complainant P.A. Joseph has instituted this\ncomplaintu/s 138Negotiable Instruments Act, 1881 (hereinafter\nreferred to as 'NI Act') against accused Joseph P.A. on 08.09.2014.2.            The factual matrix as can be culled out from the\ncomplaint is that accused and complainant had a friendly relation and\naccused took a loan of Rs. 25,00,000/­ from the complainant for a\nperiod of one year for business purpose, after passing of the period of\none year complainant contacted accused for repayment of the said\nloan, by way of phone as well as personal visit but the accused kept on\ndelaying the matter, finally accused issued the cheque in question\nbearing no. 067565 dated 14.07.2014 drawn on State Bank of\nTravancore, Main Najafgarh Road, Tilak Nagar, Delhi for an amount\nof Rs. 25,00,000/­ to the complainant with assurance of its\nencashment upon presentment. However, to the complainant's dismay\nthe said cheque was returned unpaid, when it was presented for\nencashment, with remarks "Funds Insufficient" vide return memo\ndated 16.07.2014. The complainant then issued a legal notice dated\n25.07.2014 calling upon the accused to pay the cheque amount withinCt. Case No. 12406/2019                                     Page 2 of 3315 days from the receipt thereof, the same was duly served upon the\naccused but accused failed to pay the amount due thus constraining\nthe complainant to file this complaintu/s 138Negotiable Instruments\nAct, 1881 (hereinafter referred to as 'NI Act') seeking redress against\nthe dishonor of the cheque in question.3.            With a view to establish a prima facie case in order to\nenable the court to summon the accused, complainant led pre­\nsummoning evidence by way of affidavit Ex.CW­1/A. The\ncomplainant relied upon following documentary evidence:(a) Original cheque bearing no. 067565 dated 14.07.2014 for a sum of\nRs. 25,00,000/­ drawn on State Bank of Travancore, which is Ex. CW­\n1/1.(b) Original cheque return memo dated 16.07.2014, which is Ex.CW1/2.(c) Postal receipt, which is Ex. CW­1/3.(d) Speed post tracking report, which is Ex. CW­1/4.(e) Office copy of legal notice dated 25.07.2014, which is Ex. CW­\n1/5.Complainant closed his pre­summoning evidence on 14.11.2014.4.            On the basis of above material and finding a prima facie\ncase made out against the accused, the accused was summoned vide\norder dated 14.11.2014. Accused entered his first appearance on the\ndate fixed i.e. 12.03.2015.Ct. Case No. 12406/2019                                    Page 3 of 335.            Noticeu/s 251Cr.P.C. was framed against accused on\n19.10.2015 stating out to him the substance of accusation, to which he\npleaded not guilty and claimed trial. His defence was recorded at the\nstage of framing of notice in compliance of directions passed by\nHon'ble High Court of Delhi inRajesh Aggarwal v. State171 (2010)\nDLT 51. The accused took defence that he had taken loan of a sum of\nRs. 1,00,000/­ from complainant and repaid the same in cash, that\ncomplainant made him pay interest of Rs. 2,25,000/­ over and above\nRs. 1,00,000/­ in cash, when he asked complainant to return the\ncheque, he refused and asked him to pay more money as interest\nwhich he refused to pay, a blank signed cheque was given to the\ncomplainant as security at the time of taking loan of Rs. 1,00,000/­\nand that he has no liability towards complainant.6.            Accused was granted right to cross­examine the\ncomplainant on an application filedu/s 145(2)NI Act vide order dated\n13.01.2016. The complainant was examined as CW­1 thereby\nadopting his pre­summoning evidence as post­summoning evidence\nand was cross­examined and discharged. Vide separate statement of\ncomplainant, complainant evidence was closed on 22.06.2017.7.            Statement of accused was recordedu/s 313Cr.P.C. r/wsection 281Cr.P.C. on 01.02.2018 wherein all the incriminating\nevidence was put to the accused and he was granted an opportunity to\nexplain the circumstances appearing against him at trial. While\nexplaining the circumstances appearing in evidence against him,Ct. Case No. 12406/2019                                    Page 4 of 33accused stated without oath that he did not give the cheque in question\nto complainant towards any legal liability but gave a blank signed\ncheque as security to complainant, that he did not receive any legal\nnotice, that he had taken Rs. 1,00,000/­ from complainant on interest\nand gave blank signed cheque to complainant at that time as security\ntowards repayment of loan, complainant made him pay Rs. 2,25,000/­\nas interest over and above Rs. 1,00,000/­ which he paid in cash, thus\nhe had returned entire loan amount with interest, when he asked\ncomplainant to return his cheque complainant asked him to pay more\nmoney as interest but he refused, therefore complainant misused his\nsecurity cheque and that he has no liability towards complainant.\nAccused preferred to lead evidence in his defence.8.            At the stage of defence evidence, despite several\nopportunities being given accused failed to lead evidence and thus\ndefence evidence was closed vide order dated 17.12.2019.9.            At the stage of final arguments, an applicationu/s 311Cr.P.C. was preferred by complainant on 04.02.2020, which\napplication   was     allowed   vide   order   dated   13.02.2020   and\ncomplainant/CW­1 was re­examined on 01.11.2022, wherein he relied\nupon a receipt, which is Ex.CW­1/6. He was duly cross­examined and\nCE was closed vide order dated 01.11.2022. Statement of accused was\nagain recordedu/s 313Cr.P.C. r/wsection 281Cr.P.C. on 01.11.2022\nitself wherein all the new incriminating evidence was put to the\naccused and he was granted an opportunity to explain the\ncircumstances appearing against him at trial. While explaining the\ncircumstances appearing in evidence against him, accused statedCt. Case No. 12406/2019                                     Page 5 of 33without oath that although he admits his signatures on the said receipt\nEx.CW­1/6 but he took only Rs. 1,00,000/­ from complainant with\ninterest @ 18% p.a. and has already paid Rs. 3,25,000/­ to the\ncomplainant by way of cash. Accused preferred not to lead additional\ndefence evidence.10.           At the stage of final arguments, Ld. counsel for\ncomplainant submitted that accused has taken loan of Rs. 25,00,000/­\nfrom complainant and accepted taking the said loan on a stamp paper\nand also gave the cheque in question to the complainant in discharge\nof his liability and thus prayed to convict the accused. He also filed\nwritten arguments to the effect that accused took loan of Rs. 25 lac\nfrom complainant and issued the cheque in question after one year,\nhowever the said cheque was dishonoured and accused failed to pay\nthe cheque amount even after receipt of legal notice, that accused\ncould not rebut the examination of complainant.Per contra, Ld. counsel for accused submitted that in the\ncaseu/s 138Cr.P.C. the burden upon accused is only to shift the\nburden of proof and not to prove his case beyond reasonable doubt,\nthat complaint is silent on the date, month or year of giving of loan\nand the source of arranging such a huge amount of Rs. 25,00,000/­, it\nis further mentioned in the complaint that after one year passed\naccused handed over to the complainant the cheque in question which\nis dated 14.07.2014, therefore it implies that the loan would have been\nadvanced in the year 2013 if the averments of the complaint are\nadmitted. However, during cross­examination on 23.03.2016 CW­1\ndeposed that he gave loan in 2012 in cash and that he did not\nwithdrew such amount from bank, that he has no facility of keepingCt. Case No. 12406/2019                                    Page 6 of 33cash in his office. That no document has been placed on record by\ncomplainant to prove giving of the loan except the receipt and cheque.\nIn complaint, he pleads that he gave loan first and received cheque\nafter one year, but in his evidence he deposed that cheque and receipt\nof taking loan were handed over on the same day, if this preposition is\naccepted then since the cheque was allegedly given in 2014 the receipt\nshould be also of 2014. It was further contended that CW­1 deposed\nthat his annual turnover was around Rs.10 lacs and that he is the sole\nproprietor of his proprietorship concern and is also income tax payee,\nwhen his annual turnover is Rs.10 lacs how can he arrange a huge\namount of Rs. 25 lacs for advancing it to accused, further he has\nadmitted not reflecting the said loan in his income tax return and also\ndeposed that there was no reason for him not to reflect the same in his\nincome tax return, that later CW­1 changed his statement and deposes\nthat he took Rs. 10 lac from business and Rs. 15 lac from his brother­\nin­law but he does not remember when he took such a huge amount\nfrom his brother­in­law, that in complaint it is pleaded that accused\ntook loan for business purpose but in evidence he deposed that\naccused took loan for higher study of children but he did not ask about\nthe details of such education even while advancing such a huge\namount, then he deposed that accused took loan for higher studies of\nhis children and for business. It has been further submitted that\ncomplainant then filed an applicationu/s 311Cr.P.C. to place on\nrecord a receipt when accused already submitted his written\narguments, that such application is also a part of record and therefore\nmust be read, that in the said application complainant has pleaded that\nin 2012 he gave loan to accused for business and education (the same\nnot being mentioned in his complaint), he further pleaded in his\napplication that accused gave a receipt with signatures of himself and\nhis wife (but neither in the cheque nor in the receipt signature of wifeCt. Case No. 12406/2019                                     Page 7 of 33of accused has been taken) and also pleads that the amount was\narranged by complainant from his relatives, brother­in­law, friends\nand family (which is in contradiction to his complaint and his\nevidence). That when CW­1 was again cross­examined, he deposed\nthat his application was correct but later admitted that the fact of\nreceipt being signed by wife of accused is wrong and that he did not\ntake any amount from his friends, thus he has been constantly\nchanging is version in his complaint, then in his evidence, then in his\napplicationu/s 311Cr.P.C and then again in his cross­examination, he\nalso deposed that he does not know where the receipt was prepared\nand thus his credibility has been shaken by his own testimony, later\nCW­1 deposed that he gave friendly loan but in his first cross­\nexamination he deposed that he gave loan at interest @ 18 % p.a. It\nhas been concluded by Ld. counsel for accused that can a person\nwhose turnover was Rs.10 lacs p.a. advance loan of Rs. 25 lacs when\nhe does not even remember the date, month or year of advancing such\nhuge amount, that he does not know how he arranged the money, first\nhe said he arranged money from his business, then changed his stand\nand said he took part amount from his brother­in­law, then he said he\ntook money from his friends and family also and lastly he said no he\ndid not take loan from his friends, thus complainant's evidence has no\ncredibility, that if the background of accused is seen from cross­\nexamination of CW­1 he deposed that accused used to supply\nhousehold articles from a one room shop at Uttam Nagar, that it\ncannot be believed that knowing such fact complainant advanced such\na huge amount to accused, that if the pleadings are to be believed\nsince cheque pertains to the year 2014 the loan would have been given\nin 2013 but the receipt is of 2012, that even in the receipt there is no\nparentage, age or residence of accused, that any paper prior to being\nstamped requires sufficient details of the person and then the seal ofCt. Case No. 12406/2019                                     Page 8 of 33notary is affixed but all that is lacking in the said receipt. Ld. counsel\nfor accused further stated that he earlier filed written arguments prior\nto filing of applicationu/s 311Cr.P.C. by complainant and he is\nrelying only on the cases cited in his written submissions and thus\nrelied upon the following cases praying to acquit the accused:Vipul\nKumar Gupta v. Vipin Gupta2012VIIIAD (Delhi) 218, K. Prakashan\nv. P.K. Surenderan(2008) 1 SCC 258, Kulvinder Singh v. Kafeel\nAhmed 2013 2AD (Delhi) 81, Devender Kumar v. Khem Chand Crl.Rev. P. No. 679 of 2012, Kamala S. v. Vidyadharan M.J.(2007) 5\nSCC 264, M/s Rahul Builders v. M/s Arihant Fertilizers & Chemical\n& anr. (2008) 2 SCC 321, John K. Abraham v. Simon C. Abraham&\nanr. (2014) 2 SCC 236.11.           After hearing the arguments advanced on behalf of both\nthe parties and perusing the record carefully, the appreciation of\nevidence and findings of the court are as below.12.           It would be apposite to first consider the legal position\nserving as base to the offence underlyingSection 138NI Act. The\nfollowing legal requirements need to be satisfied in order to constitute\nan offenceu/s 138NI Act, as held by Hon'ble Supreme Court in the\ncase titled as Kusum Ingots & Alloys Ltd. v. M/s Pennar Peterson\nSecurities Ltd.: (2000) 2 SCC 745:(i) that a person must have drawn a cheque on an account\n       maintained by him in a bank for payment of a certain amount\n       of money to another person from out of that account for the\n       discharge of any debt or other liability;Ct. Case No. 12406/2019                                       Page 9 of 33(ii) that the cheque has been presented to the bank within a pe­\n       riod of six months from the date on which it is drawn or within\n       the period of its validity whichever is earlier;(iii) that the cheque is returned by the bank unpaid either be­\n       cause of the amount of money standing to the credit of the ac­\n       count is insufficient to honour the cheque or that it exceeds the\n       amount arranged to be paid from that account by an agreement\n       made with the bank;(iv) that the payee or the holder in due course of the cheque\n       makes a demand for the payment of the said amount of money\n       by giving a notice in writing, to the drawer of the cheque,\n       within thirty days of the receipt of information by him from the\n       bank regarding the return of the cheque as unpaid;(v) that the drawer of such cheque fails to make payment of the\n       said amount of money to the payee or the holder in due course\n       of the cheque within 15 days of the receipt of the said notice;The above legal requirements are cumulative, meaning thereby that\nonly if all the aforementioned ingredients are satisfied can the person\nwho had drawn the cheque be held liable for offenceu/s 138NI Act.13.           Burden of proof: The claim based under the provisions\nofNegotiable Instruments Actis an exception to the general rule of\nlaw that burden of proof lies on the prosecution. The two specific\nprovisions viz.Section 118 (a)and139of NI Act contemplates that a\npresumption is attached in regard to each and every negotiable\ninstrument that the same was drawn and issued against due dischargeCt. Case No. 12406/2019                                      Page 10 of 33of the liability and thus, whenever any claim is made on the basis of a\nnegotiable instrument, the presumption has to be drawn in favour of\nthe holder of the cheque (drawee) and the law has put the burden to\nrebut the presumption on the accused that the cheque was not issued\nby him against discharge of a debt or a liability. In case, the accused is\nnot able to rebut the presumption and fails to prove his defence, the\npresumption becomes absolute and it has to be assumed that the\ncheque was issued by the accused in discharge of debt or liability and\nconsequently, accused is assumed guilty of the offence. It was held by\nHon'ble Supreme Court in the case ofRangappa v. Mohan: 2010\n(11) SCC 441 that presumption ofSection 139of N.I. Act also\nincludes the existence of legally enforceable debt:14. In light of these extracts, we are in agreement with\n               the respondent claimant that the presumption mandated\n               bySection 139of the Act does indeed include the exis­\n               tence of a legally enforceable debt or liability.Hon'ble Supreme Court, in the case ofHiten P. Dalal v.\nBratindranath Banerjee: 2001 (6) SCC 16 held that the presumption\nmentioned in thesection 139NI Act is a presumption of law and not a\npresumption of fact and thus, this presumption has to be drawn in\nfavour of the drawee and the burden to rebut the presumption with the\nprobable defence is on the accused.This is indeed an instance of the rule of 'reverse onus', where it\nis incumbent on the accused to lead what can be called 'negative evi­\ndence' i.e. to lead evidence to show non­existence of liability. Keeping\nin view that this is a departure from the cardinal rule of 'presumption\nof innocence' in favour of the accused and that negative evidence is\nnot easy to be led by its very nature, it is now settled that the accusedCt. Case No. 12406/2019                                        Page 11 of 33can displace this presumption on a scale of preponderance of probabil­\nities and the lack of consideration or a legally enforceable debt need\nnot be proved to the hilt or beyond all reasonable doubts. The accused\ncan either prove that the liability did not exist or make the non­exis­\ntence of liability so probable that a reasonable person, ought under the\ncircumstances of the case, act on the supposition that it does not exist.\nHe can do so either by leading own evidence in his defence or even by\npunching holes in the case of the complainant in the testing ordeal of\ncross­examination. This can be deciphered from relevant para no.21 ofHiten P. Dalal(supra):21. In other words, provided the facts required to form the ba­\n       sis of a presumption of law exist, no discretion is left with the\n       Court but to draw the statutory conclusion, but this does not\n       preclude the person against whom the presumption is drawn\n       from rebutting it and proving the contrary. A fact is said to be\n       proved when, "after considering the matters before it, the\n       Court either believes it to exist, or considers its existence so\n       probable that a prudent man ought, under the circumstances of\n       the particular case, to act upon the supposition that it exists".Therefore, the rebuttal does not have to be conclusively estab­\n       lished but such evidence must be adduced before the Court in\n       support of the defence that the Court must either believe the\n       defence to exist or consider its existence to be reasonably\n       probable, the standard of reasonability being that of the 'pru­\n       dent man'.Further, in Bharat Barrel v. Drum Manufacturing: AIR 1999 SC\n1008 Hon'ble Supreme Court held that the accused has to rebut theCt. Case No. 12406/2019                                      Page 12 of 33presumption and mere denial of passing of consideration is no de­\nfence.It is, thus, clear that in cases ofSection 138NI Act, upon proof\nof foundational facts, law presumes in favour of drawee that the\ncheque was issued by the accused in discharge, wholly or in part, of\nlegally enforceable debt or liability and the burden to rebut the same is\nupon the accused. The burden does not have to be conclusively estab­\nlished but the accused has to prove his defence on preponderance of\nprobability.14.             Now applying the above law to the facts of the present\ncase, it has to be adjudged whether the legal requirements laid down\nhereinabove have been fulfilled in the instant case.14.1. The first legal requirement is:"A person must have drawn a cheque on an account\n         maintained by him in a bank for payment of a certain amount\n         of money to another person from out of that account for the\n         discharge of any debt or other liability."At the outset, it has to be proved that the accused had issued the\ncheque in question on his account maintained with a bank for\ndischarge of any debt or other liability. In the instant case, accused has\nadmitted his signatures on the cheque in question in his statementCt. Case No. 12406/2019                                        Page 13 of 33recordedu/s 313Cr.P.C. and in notice framedu/s 251Cr.P.C. The\ncheque in question has also been drawn on the account maintained by\nhim with State Bank of Travancore. The said fact has not been denied\nby accused at any stage of proceeding.It was held in the case of Kalamani Tex & anr. v. P.\nBalasubramanian: 2021 SCC Online SC 75 Hon'ble Supreme Court\nheld that:"14. Adverting to the case in hand, we find on a plain\n     reading of its judgment that the trial court completely\n     overlooked the provisions and failed to appreciate the\n     statutory presumption drawn underSection 118andSection\n     139of NI Act. The statute mandates that once the\n     signature(s) of an accused on the cheque/negotiable\n     instrument are established, then these 'reverse onus' clauses\n     become operative. In such a situation, the obligation shifts\n     upon the accused to discharge the presumption imposed\n     upon him."The above said principle has also been crystallized by Hon'ble\nSupreme Court in the case ofBasalingappa v. Mudibasappa: (2019)\n5 SCC 418, by observing that:"25. We having noticed the ratiolaid down bythis Court in\n     above cases onSections 118(a)and139, we now\n     summarize the principles enumerated by this Court in\n     following manner:(i) Once the execution of cheque is admittedSection 139of\n     the Act mandates a presumption that the cheque was for the\n     discharge of any debt or other liability.Ct. Case No. 12406/2019                                    Page 14 of 33(ii) The presumption underSection 139is a rebuttable\n        presumption and the onus is on the accused to raise the\n        probable defence. The standard of proof for rebutting the\n        presumption is that of preponderance of probabilities.(iii) To rebut the presumption, it is open for the accused to\n        rely on evidence led by him or accused can also rely on the\n        materials submitted by the complainant in order to raise a\n        probable    defence.   Inference    of    preponderance      of\n        probabilities can be drawn not only from the materials\n        brought on record by the parties but also by reference to\n        the circumstances upon which they rely.(iv) That it is not necessary for the accused to come in the\n        witness box in support of his defence,Section 139imposed\n        an evidentiary burden and not a persuasive burden.(v) It is not necessary for the accused to come in the witness\n        box to support his defence."14.2.           In the instant case, the accused having admitted his\nsignatures on the cheque in question and the said cheque being drawn\non his bank account, a mandatory presumption automatically arises in\nfavour of complainant by virtue ofSection 118(a)r/w 139NI Actthat\nthe cheque in question was issued by him in discharge of, whole or\npart of, legally enforceable debt or case liability.14.3.           Now the burden shifts upon accused to rebut the above\npresumption by raising a probable defence, by leading evidence or\nbringing such facts on record in the cross­examination of theCt. Case No. 12406/2019                                          Page 15 of 33complainant that could make the latter's case improbable. If, in such a\ncase, the accused is proved to have discharged the initial onus of proof\nplaced on him by showing that the existence of consideration was\nimprobable or doubtful or illegal, then the onus will again shift back\nto the complainant who will then be under an obligation to prove it as\na matter of fact and failure to do so will disentitle him to any relief on\nthe basis of the negotiable instrument (as held inSatish Sharma v.\nState NCT of Delhi& anr.: (2013) 204 DLT 289).14.4.          The accused has chosen to do so by cross­examining the\ncomplainant. It is undisputed fact that complainant and accused were\nknown to each other and that accused handed over the cheque in\nquestion to the complainant. However, the defence of accused has\nbeen that he borrowed only an amount of Rs. 1,00,000/­ from\ncomplainant and handed over a blank signed cheque as security for its\nrepayment, that he even repaid the same in cash along with interest of\nRs. 2,25,000/­ which complainant made him to pay, but when he\ndemanded his cheque back complainant asked for more money as\ninterest and when accused denied to pay the same, complainant\nrefused to return his cheque and that he has no legal liability towards\ncomplainant.14.5.          The plea of defence that the cheque in issue was given as\nsecurity, does not affect the case of complainantu/s 138NI Act in\nview of authoritative pronouncement by Hon'ble Supreme Court in\nthe case ofI.C.D.S. Ltd. v. Beena Shabeer(2002) 2 SCC 426 wherein\nit was observed that:Ct. Case No. 12406/2019                                       Page 16 of 33"Section 138of NI Act does not distinguish between a cheque\n        issued by the debtor in discharge of an existing debt or other\n        liability, or a cheque issued as a security cheque on the promise\n        that on the due future date the debt which shall have\n        crystallized by then, shall be paid. So long as there is a debt\n        existing, in respect whereof the cheque in question is issued, in\n        my view, the same would attractSection 138of NI Act in case\n        of its dishonor."Thus, so long as the debt is existingSection 138Cr.P.C. can be\ninvoked.14.6.          The complainant/CW­1, during his cross­examination,\ndeposed that accused used to supply him all consuming household\nitems from southern India and that he used to pay for the same then\nand there, accused had a shop at Uttam Nagar which was of medium\nsize and contained only one room, that he gave Rs. 25,00,000/­ in cash\nto accused from his office in 2012 but he does not remember the date\nand month, the said amount was not withdrawn from any bank, there\nis no facility of keeping cash in full time at his office, accused gave\nreceipt of cash, accused himself filled the details of the cheque,\naccused gave cheque and receipt together, he contacted accused to\nreturn the amount again in 2014, that he is also doing small business\nof advancing friendly loan since 6­7 years but does not have any\nlicence for the same, he runs a proprietorship firm in the name of\nMagie Printers and his income tax reflects annual business turnover\nwhich is approximately Rs. 10,00,000/­, that he gave Rs. 10,00,000/­\nfrom his business and Rs. 15,00,000/­ from his brother­in­law but\ndoes not remember date/month/year of taking this amount from hisCt. Case No. 12406/2019                                      Page 17 of 33brother­in­law, he did not show this loan of Rs. 25,00,000/­ in his\nincome tax return, there is no reason for not showing said loan in\nincome tax return, that the accused took the said loan from him for\nhigher studies of the children but he did not ask accused about the\ndetails of such higher study or for which child he required loan,\naccused requested for loan in 2012, that accused took loan for higher\nstudy of children and for business purpose, he charges interest rate @\n18% p.a. for friendly loan but he does not keep account details/books\nof Magie Printers or of any friendly loan dealing. Later he relied upon\na receipt Ex. CW­1/6 upon which he was cross­examined. He deposed\nthat he had gone through the entire applicationu/s 311Cr.P.C. and\neach averment is correct but then deposed that the statement in para\nno. 2 of his application regarding taking receipt from accused which\nbears signature of accused and his wife are wrong, that the statement\nin para no.2 regarding help taken by complainant from his relatives,\nbrother­in­law, friends and family members is true but he did not take\nany help from his friends and the same is incorrect, that the relatives is\nhis brother­in­law only, that he also did not take help from his family\nmembers and the said fact in para no.2 is also wrong, he does not\nknow where the said receipt was prepared, the suggestion that accused\ngave receipt along with cheque is incorrect, the receipt was given to\nhim at the time of taking loan, there was no one at his office at the\ntime of taking the receipt, he did not insist on making anyone the\nwitness, the receipt does not bear his address, it does not bear terms\nand conditions of loan, he did not give the loan for earning interest or\nprofit, that he did not mention about the receipt in his complaint or\nevidence by way of affdavit and denied the suggestion of the receipt\nbeing false and fabricated.Ct. Case No. 12406/2019                                       Page 18 of 3314.7.         It is settled law that accused need not lead evidence and\nit is sufficient if he raises probable defence by cross­examining the\ncomplainant. From the testimony of complainant, it is evident that the\ncomplainant has been retracting from his previous statements.\nComplainant does not know the date or month of advancing such a\nhuge amount of Rs. 25,00,000/­ to the accused, he failed to even aver\nabout the year of advancing the loan in his complaint. Although he\ndeposed in his cross­examination that he advanced the said loan in the\nyear 2012, but the cheque in issue is dated 14.07.2014 and according\nto the pleadings of the complainant himself, accused issued the said\ncheque after one year from advancement of the loan. The date on the\ncheque being 14.07.2014, either the year of advancement of the same\nbeing 2012 is deposed incorrectly or the pleadings and testimony of\nCW­1 that the cheque was issued after one year from advancement of\nloan, is incorrect.14.8.         The testimony of complainant suffers from material\ncontradiction with respect to purpose of alleged loan. In complaint and\nin examination in chief, CW­1 deposed that the alleged loan of Rs.\n25,00,000/­ was taken by accused for business purpose. However,\nduring cross­examination, CW­1 firstly deposed on 23.03.2016 that\naccused took loan for business purpose, and later voluntarily corrected\nhimself and deposed that the loan was taken by accused for higher\nstudies of children as well as for business purpose. He further stated\nthat he did not enquire about the details of such study for which such a\nhuge amount was taken by accused nor did he enquire about the child\nfor whose education the said amount was being taken by accused. He\nalso did not maintain any details or record of such loan account.Ct. Case No. 12406/2019                                     Page 19 of 3314.9.         The accused has challenged the source and capacity of\ncomplainant in advancing a huge sum of Rs. 25,00,000/­ to the\naccused. The complainant's testimony reveals that he himself is\nunaware as to how he arranged such a huge amount of Rs.\n25,00,000/­. The complaint is silent on the said aspect. However,\nduring cross­examination, he first deposed that he arranged the money\nin hard cash from his business. Upon being questioned, he stated that\nhis office does not have facility of full time keeping of such a huge\namount of money and that he did not withdrew such amount from the\nbank. Later, when he was questioned about his income, he deposed\nthat he arranged Rs. 10,00,000/­ from his business and remaining\namount of Rs. 15,00,000/­ was taken from his brother­in­law. Yet\nagain, he filed an applicationu/s 311Cr.P.C. stating that he arranged\nthe said amount from his relatives, brother­in­law, friends and family\nmembers and in his deposition, first he agreed that the contents of his\napplication are correct but then retracted from the same and stated that\nhe did not take help from his friends or family members and that\nrelatives means his brother­in­law only. Thus, the testimony of\ncomplainant failed to withstand the challenge posed by accused during\ncross­examination. Moreover, despite such challenge, complainant\nfailed to examine his brother­in­law from whom he states to have\nborrowed a huge amount of Rs. 15,00,000/­, the date/month or even\nyear of which CW­1 does not remember.14.10.        Further, CW­1 deposed that he is an income tax payer\nwithout default and that his income tax return also reflects the\nturnover of his business. He then deposed that his annual turnover is\napproximately Rs. 10,00,000/­ and that he also lends money on\nfriendly loan but does not have any such license. It was then that CW­Ct. Case No. 12406/2019                                     Page 20 of 331 changed his earlier testimony and stated that he took Rs. 10,00,000/­\nfrom his business and Rs. 15,00,000/­ from his brother­in­law. Ld.\ncounsel for accused has argued that how can a person having annual\nturnover of Rs. 10,00,000/­ advance friendly loan of Rs. 25,00,000/­.\nThe contentions of Ld. counsel for accused have merit, specifically in\nview of the further deposition of CW­1 wherein he stated that he did\nnot reflect such loan transaction in his income tax return, that he does\nnot maintain any books/ record of such transaction, that he did not\nwithdraw such amount from his bank and that he gave such amount\nfrom his shop but his shop does not have facility of keeping such huge\nhard cash. The fact that complainant who had only a business friendly\ndealing with accused having a medium size shop at Uttam Nagar who\nused to supply household items to complainant, would part with an\namount of money which was more than double the stated annual\nturnover of entire business of complainant, that too without any\ninterest or profit and without any witness to the same, is hard to appeal\nthe conscience of a prudent person.14.11.        The only evidence of such a huge transaction is stated to\nbe a receipt Ex. CW­1/6. However, the same has also been challenged\nto be forged and fabricated by accused in cross­examination of\ncomplainant. The receipt does not bear any date. It does not bear any\nparentage, age or any details including residential address of either\nparty. It merely mentions that Joseph PA "is taking" friendly loan\nfrom PA Joseph for a sum of Rs. 25 lacs for his business purpose and\nhis children's studies on 07.03.2012. The language of the receipt and\nthe words "is taking" and "on "7 th March 2012" only suggests that the\nreceipt was executed on 07.03.2012. Ld. counsel for accused has\nchallenged the said receipt arguing that this receipt does not findCt. Case No. 12406/2019                                      Page 21 of 33mention in the complaint or in the evidence by way of affidavit of\ncomplainant. This receipt was brought on record at the stage of final\narguments after accused filed his written submissions and no reason\nfor not bringing the same on record finds mention either in the\ncomplaint or in the evidence by way of affidavit. Further, the\napplicationu/s 311Cr.P.C. was filed by complainant alleging that he\nwished to bring on record a receipt signed by accused and his wife but\nupon being cross­examined, CW­1 deposed that the said statement\nwas incorrect and that the receipt does not bear signature of wife of\naccused. Also, it mentions that the loan was taken on 07.03.2012.\nHowever, evidence of complainant depicts that the receipt was given\nat the time of taking of loan and that the cheque was handed over after\none year from the loan, but the cheque is dated 14.07.2014, which\ndepicts that the cheque was given after more than two years from\nalleged advancement of loan. Also, complainant has given\ncontradictory statement when he stated that the cheque and receipt\nwere issued at the same time. Furthermore, CW­1 also does not know\nwhere the receipt was prepared. Only the signatures of accused on the\nsaid receipt are admitted by him in his statement u/s 313 Cr.P.C.14.12.        Now the question arises as to the evidentiary value of\nstatementu/s 313Cr.P.C. and can mere admission by accused of his\nsignatures on receipt Ex.CW­1/6 without admitting its contents, that\ntoo in his statementu/s 313Cr.P.C bring home conviction? The\nanswer to the above question is in negative. It is settled law that the\nstatement of accusedu/s 313Cr.P.C. is not a substantive piece of\nevidence. It can be used for appreciating evidence led by the\nprosecution/complainant to accept or reject it. It is, however, not a\nsubstitute for the evidence of prosecution/complainant. Such aCt. Case No. 12406/2019                                     Page 22 of 33statement can be used as an aid to lend credence to the evidence led by\nprosecution/complainant.       But     ultimately,    the    case      of\nprosecution/complainant must stand on its own legs. In the present\ncase, complainant does not know who signed the receipt as he stated\nin his applicationu/s 311Cr.P.C. that the receipt was signed by\naccused and his wife and in his cross­examination deposed that it was\nonly signed by accused. Complainant also does not know where the\nsaid receipt was prepared. He has also given contradictory statements\nregarding issuance of cheque along with execution of receipt or\nthereafter. The receipt merely bears the names of parties without any\nreference to their parentage, age, or residential address, no witness has\nsigned the same. It does not bear the terms and conditions of loan or\npromise to return the same after a specified period upon which the\nliability of accused can be said to have arisen.14.13.        Now coming to the case laws referred by Ld. counsel for\naccused and their relevance to the present case.14.13.1.In the case ofVipul Kumar Gupta v. Vipin Gupta2012\nVIIIAD (Delhi) 218 Hon'ble High Court of Delhi affirmed the\njudgment of Trial court and acquitted the accused observing that\nbefore a person is convicted for having committed an offenceu/s 138NI Act it must be proved beyond reasonable doubt that the cheque in\nquestion must have been issued by him in discharge of his liability or\nlegally recoverable debt and some of the reasons for doubting the\nsame were non­mentioning by complainant in his income tax return or\nbooks of account, the factum of loan having been given by him as by\nno factor can the loan amount of Rs. 9,00,000/­ be said to be a smallCt. Case No. 12406/2019                                      Page 23 of 33amount which a person would not reflect in his income tax return or\nbooks of account in case the same has been lent to a person, non­\nmentioning of date, time or year of loan in complaint and evidence,\nthe cheque having particulars written in two different inks.In\nKulvinder Singh v. Kafeel Ahmed 2013 2AD (Delhi) 81 Hon'ble\nHigh Court of Delhi upheld the order of acquittal and observed that if\ncomplainant advanced huge amount of money of Rs. 9,30,000/­ he\nought to have shown to the court the source from where he had\ngenerated such a huge amount, but he has failed to reflect the same in\nhis income tax return or books of account, this creates a doubt\nregarding truthfulness of the stand taken by complainant that he\nadvanced loan of Rs. 9,30,000/­ to accused. In the present case as\nwell, the complainant has failed to mention advancement of huge sum\nof Rs. 25,00,000/­ in his income tax returns or to keep any books of\naccount or record thereof. In the present case as well, the signature of\naccused is in different ink than the handwriting on the cheque filling\nthe remaining particulars, and the complainant has failed to show the\nsource from where he arranged such a huge amount, his annual\nturnover of business only being less than half of the alleged sum of\nmoney lent.14.13.2.In the case ofK. Prakashan v. P.K. Surenderan(2008)\n1 SCC 258 it was held by Hon'ble Supreme Court that in cases of\ncheque returned with remarks "stop payment", if stoppage of payment\nbefore due date of the cheque is allowed to take the transaction out of\npurview ofSection 138NI Act, it will shake the confidence which a\ncheque is otherwise intended to inspire regarding payment being\navailable on the due date, and in such cases if two views are possible,\nthe appellate court shall not reverse a judgment of acquittal onlyCt. Case No. 12406/2019                                     Page 24 of 33because another view is possible to be taken. The above case is not\nrelevant to the adjudication of present case as the cheque in question\nin this case has been returned unpaid with remarks 'funds\ninsufficient'. The case of M/s Rahul Builders v. M/s Arihant\nFertilizers & Chemical & anr. (2008) 2 SCC 321 also does not relate\nto the issue in the present case, in so far as the above referred case\nrelated to notice of demand being not proper.InDevender Kumar v.\nKhem Chand Crl. Rev. P. No. 679 of 2012 Hon'ble High Court of\nDelhi observed that the accused appears to have rebutted the existence\nof legally enforceable debt by establishing that no loan was advanced\nto him even though there was an agreement and a corresponding\npromissory note and an affidavit, the loan was not shown in income\ntax return of complainant, an adverse inference could be draw upon\ncomplainant on that account and the loan amount appears to be\ndoubtful. In the above referred case, ,the loan agreement did not\ncontain any acknowledgment of disbursement of loan amount of Rs.\n1.40 lacs, the agreement merely indicated that on terms and conditions\nindicated, a friendly loan was agreed to be given to accused, it was an\nagreement to pay the loan amount in future, it was not signed by any\nwitness and it was found that an agreement was entered into without\nactual transfer of money. This case is also not relevant to the decision\nof the present case as no agreement of loan has been executed in the\npresent case but only a receipt of payment which also has been\ndisputed.14.13.3.InKamala S. v. Vidyadharan M.J.(2007) 5 SCC 264, it\nwas held by Hon'ble Supreme Court that the standard of proof in\ndischarge of the burden in terms ofSection 139NI Act being ofCt. Case No. 12406/2019                                     Page 25 of 33preponderance of probability, the inference therefore can be drawn not\nonly from the materials brought on record but also from the reference\nto the circumstances upon which the accused relies upon. The burden\nof proof upon accused is not as high as that of the prosecution.14.13.4.InJohn K. Abraham v. Simon C. Abraham& anr.\n(2014) 2 SCC 236, Hon'ble Supreme Court affirmed the decision of\nacquittal of Trial court on the grounds that in order to draw\npresumption u/s 188 r/w 139 burden lies on complainant to show that\nhe had requisite funds for advancing the sum of money/loan in\nquestion to the accused, that the issuance of cheque by accused in\nsupport of repayment of money advanced was true, that the accused\nwas bound to make payment as had been agreed while issuing cheque\nin favour of complainant, butin that casethe complainant was not\naware of the date when substantial amount of Rs. 1,50,000/­ was\nadvanced by him to accused, he failed to produce relevant documents\nin support of the alleged source for advancing money to accused, he\nwas not aware as to when and where the transaction took place for\nwhich the cheque in question was issued to him by accused, he was\nnot sure as to who wrote the cheque and making contradictory\nstatements in this regard.14.14.        In view of above referred case laws, in the present case\nalso complainant has miserably failed to prove the source of huge\namount of cash of Rs. 25,00,000/­ albeit he has mentioned\ncategorically that he did not withdraw any amount from his bank; he\nhas given contradictory statements regarding the arrangement of the\nsaid amount whether he arranged it by himself, or from his brother­in­Ct. Case No. 12406/2019                                      Page 26 of 33law, or from his family members and friends and relatives; he has\nfailed to prove the date/time/month or year of lending the said loan; he\nhas failed to prove the receipt of loan the date on which goes contrary\nto the pleadings and examination in chief of complainant; he does not\nknow who signed the receipt as contradictory statement was made in\nthe applicationu/s 311Cr.P.C.; he does not know where the receipt\nwas prepared; he has failed to establish the requirement of loan for\nwhich he agreed to part away with huge amount of cash that too\nwithout any interest and without having any personal relationship with\naccused; in fact complainant has given contradictory statements with\nrespect to purpose of loan and whether the cheque in question was\nissued at the time the receipt was executed or thereafter; he has failed\nto reflect the advancement of such a huge amount of loan in his\nincome tax return; the signature on the cheque also appears to be in an\nink different from that of remaining particulars; the complainant has\nhimself stated his annual turnover of Rs. 10,00,000/­ and yet parted\nwith more than twice that amount in a single day to a person he had\nfriendly business relationship is hard to believe. Thus, accused has\ndischarged his burden, by preponderance of probability and raised a\ndoubt in the case of complainant by raising above factors.14.15.         Thus, accused has been able to successfully rebut the\npresumption of law and discharge the burden of proof by raising a\nprobable defence that the cheque in question was not issued in\ndischarge of his liability as the lending of Rs. 25,00,000/­ by\ncomplainant has not been proved.The first legal requirement is, thus, proved in favour of\naccused and against the complainant.Ct. Case No. 12406/2019                                      Page 27 of 3315.     The second legal requirement is:"That cheque has been presented to the bank within a period of\n       six months from the date on which it is drawn or within the pe­\n       riod of its validity whichever is earlier."The cheque in question Ex. CW­1/3 is dated 02.01.2017. The cheque\nreturn memo Ex. CW­1/4 is dated 04.01.2017 and the statement of\naccount Ex.DW­4/2 reflects that the cheque was presented for\nencashment on 04.01.2017, which proves that the cheque in question\nwas presented within the period of its validity. Further, defence has\nfailed to controvert the said fact.Thus, the second legal requirement is adjudicated in favour\nof complainant.16.     The third legal requirement is:"That cheque is returned by the bank unpaid, either because of\n       the amount of money standing to the credit of the account is in­\n       sufficient to honour the cheque or that it exceeds the amount\n       arranged to be paid from that account by an agreement made\n       with the bank."Section 146NI Act presumes the fact of dishonour of cheque upon\nproduction of bank's slip or memo having the official mark denoting\nthat the cheque in question has been dishonoured. This is also a rebut­\ntable presumption and the upon production of such bank memo, the\nburden shifts upon accused to disprove the same.Ct. Case No. 12406/2019                                    Page 28 of 33In the instant case, a presumption has been raised in favour of com­\nplainant by virtue ofSection 146NI Act that the cheque in question\nwas dishonoured for the reason stated therein viz. Funds insufficient\nand therefore, the burden now shifts upon the accused to rebut this\npresumption by establishing some reasonable justification for the\nsame. But the accused has admitted his signatures on the cheque in\nquestion and the fact of its dishonor.Thus, the third legal requirement is adjudicated in favour\nof complainant.17.    The fourth legal requirement is:"The payee or the holder in due course of the cheque makes a\n       demand for the payment of the said amount of money by giving\n       a notice in writing, to the drawer of the cheque, within thirty\n       days of the receipt of information by him from the bank regard­\n       ing the return of the cheque as unpaid."The cheque was dishonoured vide return memo dated 04.01.2017 and\nthe complainant sent a legal notice dated 18.01.2017 (Ex.CW­1/5) ad­\ndressed to the accused. Corresponding speed post receipt (Ex.CW­1/6)\nis also on record. The complainant has alleged that accused also sent a\nreply to the said legal notice though it has not been produced in evi­\ndence. Nervertheless, the accused has admitted receiving the notice in\nhis plea of defence and did not dispute his address mentioned on the\nnotice. The notice has been sent by post correctly addressed to the ac­\ncused within a period of thirty days from the date of return memo.Ct. Case No. 12406/2019                                    Page 29 of 3317.1.          In this regard,Section 27General Clauses Act comes\ninto play which gives rise to presumption that service of notice has\nbeen effected when it is sent to the correct address of accused by reg­\nistered post. It was held by Hon'ble Supreme Court in the case titled\nasC.C. Alavi Haji v. Palapetty Muhammad: (2007) 6 SCC 555 that:14.Section 27[General Clauses Act] gives rise to presumption\n        that service of notice has been effected when it is sent to the\n        correct address of accused by registered post. In view of the\n        said presumption when stating that a notice has been sent by\n        registered post to the address of the drawer, it is unnecessary\n        to further aver in the complaint that in spite of the return of the\n        notice unserved, it is deemed to have been served or that the\n        addressee is deemed to have knowledge of the notice. Unless\n        and until the contrary is proved by the addressee, service of\n        notice is deemed to have been effected at the time at which the\n        letter would have been delivered in the ordinary course of\n        business."Thus, in view ofSection 27General Clauses Act it is presumed that\nthe accused received the legal notice, as he admitted his address as\ncorrectly mentioned on the legal notice (Ex.CW­1/5).17.2. Even otherwise, law expects a person pleading non­receipt of\nany demand notice to prove his bona fide by making the payment of\nthe cheque amount within 15 days of receiving court summons. This is\ncrystallized by the verdict of Hon'ble Supreme Court in the case titledCt. Case No. 12406/2019                                        Page 30 of 33asC.C. Alavi Haji v. Palapetty Muhammed& anr.: (2007) 6 SCC\n555:"17. It is also to be borne in mind that the\n        requirement of giving of notice is a clear departure\n        from the rule of Criminal Law, where there is no\n        stipulation of giving of a notice before filing a\n        complaint. Any drawer who claims that he did not\n        receive the notice sent by post, can, within 15 days of\n        receipt of summons from the court in respect of the\n        complaint undersection 138of the Act, make payment\n        of the cheque amount and submit to the Court that he\n        had made payment within 15 days of receipt of\n        summons (by receiving a copy of complaint with the\n        summons) and, therefore, the complaint is liable to be\n        rejected. A person who does not pay within 15 days of\n        receipt of the summons from the Court along with the\n        copy of the complaint undersection 138of the Act,\n        cannot obviously contend that there was no proper\n        service of notice as required undersection 138, by\n        ignoring statutory presumption to the contrary underSection 27of the G.C. Act andsection 114of the\n        Evidence Act."17.3. In the case at hand, despite issuance of summons and\nappearance of accused before the court, accused has failed to pay the\ncheque amount to the complainant and thus is precluded from raising\nthe plea of non­service of demand notice.Ct. Case No. 12406/2019                                    Page 31 of 33The fourth legal requirement is, thus, adjudicated in favour\nof complainant.18.    The fifth legal requirement is:"The drawer of such cheque fails to make payment of the said\n       amount of money to the payee or the holder in due course of\n       the cheque within 15 days of the receipt of the said notice."It has been presumed hereinabove that the accused received the legal\nnotice. It is an undisputed fact and also a matter of record that the ac­\ncused has failed to make the payment till date let alone making pay­\nment within 15 days of receipt of notice. The defence taken by ac­\ncused for not making the payment within the statutory period of 15\ndays has been that he has no liability to pay the complainant.Thus, the fifth legal requirement is adjudicated in favour of\ncomplainant.19.    All the legal requirements constituting an offenceu/s 138NI\nAct being cumulative in nature, the fact that the first legal requirement\nhas not been proved in favour of complainant, the ingredients\nnecessary to bring home the guilt of accused remain incomplete.\nAccordingly, accused Joseph P.A. is acquitted for the alleged\noffenceu/s 138NI Act.Ct. Case No. 12406/2019                                      Page 32 of 3320.    Bonds under Section 437­ACr.P.C. are accepted for a period of\nsix months from today.Announced in the open\ncourt on 24.11.2022\n\n                                      (Aakanksha)\n                             Metropolitan Magistrate(NI Act)­07\n                             South West District, Dwarka Courts\n                                       New DelhiCt. Case No. 12406/2019                                   Page 33 of 33