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IN THE COURT OF THE ADDITIONAL CHIEF JUDICIAL MAGISTRATE,SIVASAGAR.

CR (NI). CASE NO. 204/10U/s 138 of the Negotiable Instruments Act, 1881.

SumirAgarwalla,S/OLt. SitaramAgarwalla,

C/OBalaji Market, J.P. Agarwalla Path,Sivasagar Town,

PO& PSSivasagar,Dist: Sivasagar.

…..Complainant

vs.

Abhoy Kr. Bogar,S/O Lt. ViswanathBogar,

R/O Khijnoor Ali Road, Sivasagar Town,P.O & PS Sivasagar,

Dist: Sivasagar.

.…..Accused.

PRESENT: Mishbahul Hassan Ansari, A.J.S.

Addl. Chief Judicial Magistrate, Sivasagar.

ADVOCATES:

For the Complainant: Mr. Sk. Shamsher, Ld. Advocate.

For the Accused: Mr. M.D. Sahewala Ld. Advocate,

Offence Explained: 05/03/11

Date of Evidences:04/08/11, 22/09/11, 07/05/12, 03/12/12, 26/04/16,23/06/16, 03/12/16.

Date of Argument:13/06/2017&12/07/17

Date of Judgment:28/07/2017.

JUDGMENT

1. The case of the complainant in brief is that the complainant is a businessman

by profession and both the complainant and the accused have known each

other since last several years. That to meet his urgent need the accused took

a financial help of ₹ 4,00,000/-(Rupees four lakhs) by executing

undertakings to repay the same but the accused failed to keep his promise.

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The complainant approached the accused times for repayment of the amount

but the accused avoided the payment on this and that pretext, compelling the

complainant to draw a legal notice on 15/05/2010, through Mr. BikashDey,

advocate of the Sibsagar Bar Association, which was received on 17/05/2010.

That upon receipt of the registered legal notice under reference, the accused

issued A/C payee cheque No. 005089 dated 20/07/2010, for ₹ 4,00,000/-

(Rupees four lakhs) drawn at Axis Bank Ltd., Sivasagar branch. The

complainant presented the chequefor encashment in UBI, Sivasagar but the

cheque was dishonored due to insufficient funds in the account of the

accused and the same was informed to the complainant vide certificate dated

25/08/2010 issued by UBI, Sivasagar. That the cheque being dishonored, the

complainant vide legal notice dated 02/09/2010, demanded the accused to

make the Payment of the cheque amount of ₹ 4,00,000/-(Rupees four lakhs)

with up-to-date interest thereon to the complainant within a period of

15(fifteen) days of receipt of the notice. The accused received the legal

notice on 03/09/2010, but failed to make the payment of the cheque amount.

Hence, the case.

2. The complainant filed his initial deposition by way of affidavit. On perusal of

the materials on record, cognizance was taken by my predecessor in Court

and summons was issued to the accused person. On appearance of the

accused person before this Court, the particulars of the offence punishable

under section 138 of the Negotiable Instruments Act were read over and

explained to him to which he pleaded not guilty and claimed trial.

3. In order to prove his case, the complainant examined himself and three

other witnesses including a bank official. The accused person was

examined under section 313, Cr.P.C. He denied borrowing the cheque

amount. He insisted that he borrowed only ₹ 40,000/- (Rupees forty

thousand).He accepted the fact that he issued the cheque but he

insisted that the cheque was issued as a security measure at the time of

obtaining the loan of ₹ 40,000/- (Rupees forty thousand).The accused

did not examine defencewitness.He however, submitted his

wriitenstatetement u/s 313 of the Cr.P.C.

4. I heard the arguments advanced by both the parties. The parties

submitted their respective written arguments as well. The complainant

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relied on the following case laws to prove his case: BanwarilalVs. Balbir

Singh, reported in 2016(1) SCC-607-D; Md. Motiur Rahman Vs. Ramjan

Ali reported in 2001(2) GLR-576; Standard Chartered Bank VS. Andhra

Bank Financial Services Ltd reported in 2016(2)SCC-207(E); M.S.

Narayana Menon Alias Mani Vs. State of Kerala and Another reported in

2006(6)SCC-39; BS Sheshagiri Shetty and Others vs. State of Karnataka

and others reported in 2016(2)SCC-123(F); BanwariLal (dead) by Legal

Representatives and another vs. Balbir Singh reported in 2016(1)SCC-

607(D); and Haryana State Cooperative Supply and Marketing

Federation Limited vs. Jaya Textiles and another reported in

2014(4)SCC-704.

5. On the other hand the defence relied upon the following cases.MD

Ramakrishnaiah vs. V. Javaregowda reported in 2014 (1) Civil LJ 269;

Krishna JanrdhanBhat vs. Dattaraya Hedge, reported in (2008)4 SCC

54; K Prakashan vs. PK Surendran reported in 2008 (1) SCC 258;Tahar

N. Khambati vs. M/s Vinayak Enterprise; Smti. Rumi Hazarika vs.

AnirbanHatikakoty, reported in 2016 (1) GLJ 251; C. Antony vs. KG

Raghavan, reported in AIR 2003 SC 182; MS Narayana Menon Vs. State

of Kerala, reported in (2006) 6 SCC 39; and Reverend Mother Marykutty

vs. Reni C. Kottaram, reported in (2013) 1 SCC 327.

POINT FOR DETERMINATION.

6. The following points for determination have been taken up for discussion in the

case:

I. Whether the accused person issued the cheque for the

discharge of any legally enforceable debt or liability?

II. Whether the accused person received the demandnotice issued by the complainant regarding thedishonour of the cheque?

III. Whether the accused has committed the offence under

section 138 of the Negotiable Instruments Act, 1881?

DISCUSSION, DECISION AND REASONS THEREOF

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POINT FOR DETERMINATION NO.1: Whether the accused person issued

cheque to discharge any legally enforceable debt or liability?

7. The complainant in his examination-in-chief stated that to meet his urgent

need the accused took a financial help of ₹4,00,000/-(Rupees four lakhs)

from him by executing an undertaking to repay the same but the accused

failed to keep his promise. He approached the accused several times for

repayment of the amount but the accused avoided the payment on this and

that pretext compelling him to draw a legal notice on 15/05/2010, through

Mr. BikashDey, advocate of the Sibsagar Bar Association, which was received

by the accused on 17/05/2010. That upon receipt of the registered legal

notice under reference, the accused issued A/C payee cheque No. 005089

dated 20/07/2010, for ₹4,00,000/- (Rupees four lakhs) drawn at Axis bank

Ltd., Sivasagar branch. He placed the chequefor encashment but cheque was

dishonored for insufficient funds in the account of the accused. That the bank

informed him vide certificate dated 25/08/10. That the cheque being

dishonored, he served legal notice dated 02/09/2010, through his advocate,

and demanded the accused to make the payment of the cheque amount of

₹4,00,000/-(Rupees -four lakhs) with up-to date interest thereon within a

period of 15(fifteen) days of receipt of the notice. The accused received the

legal notice on 03/09/2010, but the accused failed to make the payment of

the cheque amount and hence he has instituted the case against the accused

praying for appropriate action against him.

8. In his cross examination the complainant stated that he has income tax file

but he did not show that the amount of money he had lent to the accused.

That he maintains books of accounts. That he maintains the financial

transaction in his books of accounts. That there is no date under the

signatures of the accused in Exhibit-1 and Exhibit-2. That the signature of the

accused is not exhibited in Exhibit-1. That only the signature of Sankar Borah

(PW.2) is exhibited as Exhibit-1 (1) in Exhibit-1. That the Exhibit-1, Exhibit-2

and Exhibit-3 bore the signatures of the accused when the same were

drafted. That the witnesses signed the documents in his presence. That they

had not seen the accused signing the Exhibit-3. That the witness Sankar

Borah works under him and drives vehicle. That witness Dipen Das and Om

Prakash Agarwala are his tenants. That he lent money to the accused by

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through Exhibit-3 before getting back the money lent through Exhibit-1 and

Exhibit-2. That the Exhibit-3 was notorized after the witnesses had signed the

same. That the Exhibit-1 was not notorized. He denied that the documents

were executed without any financial transaction between the parties. The

complainant denied that the signatures in Exhibit-1, Exhibit-2 and Exhibit-3

do not belong to the accused. That the Exhibit-5 mentions that the accused

borrowed money from him on 6 occasions. That the accused told him that he

would pay interest at the time of borrowing the money. The complainant

denied that he had forged the Exhibit-1, Exhibit-2 and Exhibit-3. That in

Exhibit-6 there is no date under the signature of the accused. He denied that

the date in Exhibit-6 is written in his handwriting. That his name and amount

in Exhibit-6 were written by him. He denied that he had misused the Exhibit-6

by inserting the amount himself. That the Exhibit-6 is dated 20/07/10 and the

same was presented for clearance on 25/08/10 but he has not mentioned as

why he presented the cheque in bank belatedly. He denied that he deals in

lending money on high interest. He denied that he obtains signatures of

borrowers on paper at the time of lending the money. That he denied having

the knowledge that transaction above twenty thousand has to be done

through cheque. He denied that long back he lent one and half lakhs of

rupees to the accused after taking a blank cheque and a signed paper. He

denied that the accused had returned ₹ 320,000/- (Rupees three lakhs and

twenty thousand) to him in the presence of Ratul Das, Robin Das and

PapuGogoi. He denied that he demanded money from the accused on the

strength of a blank paper. He denied that the accused does not owe money

to him. He denied that the Exhibit-1, Exhibit-2 and Exhibit-3 were forged

subsequently after the institution of this case. He admitted that he did not

mention about the agreements in his complaint.

9. The PW.2 Sankar Borah in his examination-in-chief stated that he knows both

the parties. That on 16/08/2009 and 23/03/2010 the accused executed

undertakings and borrowed an amount of ₹ 150,000/- and ₹ 100,000/-

from the complainant for business purpose. The Exhibit-1 is the undertaking

dated 16/08/09 and Exhibit-1 (1) is his signature. That the Exhibit-3 is the

undertaking dated 23/03/11 and Exhibit-3 (1) is his signature.

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10. In his cross examination the PW.2 stated that he has deposed evidence in

three other cases on behalf of the complainant SumirAgarwalla. The

complainant and the accused both signed in the undertaking (Exhibit-1)

pertaining to this case. He signed the undertaking as a witness. He had

signed on two papers. He had signed on two papers regarding to an amount

of ₹200,000/- (Rupees two lakhs) each. There is a wine shop in JP Agarwala

Road. The wine shop belongs to RohiniRajkhowa. He was called from the

wine shop by the complainant in order to sign the Exhibit-1. He does not

remember if there was a revenue ticket in the Exhibit-1. He does not know

where Exhibit-1 was prepared. He signed the Exhibit-1 first. He does not

know if Rajesh Chandok also signed the same. He did not see any Dilip Das

when he signed the Exhibit-1. The examination-in-chief on affidavit of mine

neither bears the signature of the Notary nor the signature of the Court. He

does not know there my examination-in-chief on affidavit was prepared. The

Exhibit-E is his examination-in-chief on affidavit and Exhibit- E (1) and E (2)

are his signatures. He had signed the Exhibit-1 and Exhibit-3 before the

MaghBihu of 2009 or 2010. It is not a fact that he had deposed on behalf of

the complainant after taking money from the complainant. It is not a fact that

he had deposed evidence on behalf of the complainant in four other cases.

He has deposed evidence in CR case no.180/10, CR case no.179/10, CR case

no. 181/10, and CR case no. 219/10 on behalf of complainant

SumirAgarwala. It is not a fact that in CR case no.180/10 he admitted in his

cross examination that he had filled the cheque (Exhibit-A). It is not a fact

that in CR case no.179/10 he admitted in his cross examination that he had

written the figure ₹ 5,00,000/- in the cheque (Exhibit-A). It is not a fact that

in CR case no.181/10 he admitted in his cross examination that the

handwriting in the cheque (Exhibit-A) is mine. That he did state in his

deposition in CR case no.219/10 that the complainant is his friend. He does

not know if the complainant is a money lender. He does not know if the

complainant takes blank cheques from poor people after lending money. He

does not know if the complainant lends ₹2000/- to ₹4000/- to people and

takes blank cheques. It is not a fact that he fills the blank cheques for the

complainant. It is not a fact the complainant pays him a share of the illegal

cheque amounts.

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11. The PW.3 Rajesh Chandak in his examination-in-chief stated that he knows

both the parties. That the accused executed undertakings and borrowed an

amount of ₹ 150,000/- and ₹ 100,000/- from the complainant for business

purpose. The Exhibit-2 is the undertaking dated 01/10/09 and Exhibit-2 (1) is

his signature. That the Exhibit-3 is the undertaking dated 23/03/11 and

Exhibit-3 (2) is his signature.

12. In his cross examination the PW.3 stated that it is not mentioned in whose

name the Exhibit-2 and the Exhibi-3 were issued. That he signed the Exhibit-

2 and Exhibit-3 as witnesses in the house of the complainant. That he signed

the documents on being asked to do so by the complainant and the accused.

That he does not know who types and drafted the Exhibit-2 and Exhibit-3.

That he does not remember as to when he signed the Exhibit-2 and Exhibit-3.

That he had deposed evidence in favour of the complainant in two other

cases.

13. The PW.4 Shehnaz Yasmin stated that the Exhibit-6 is a cheque of their Axis

bank. Ajay Kumar Bagor is a customer of our bank. On 24/08/10 the Cheque

bearing no.005089 (Exhibit-6) was dishonoured due to insufficient fund in the

account of Ajay Kumar Bagor. The Exhibit-7 is the return memo of the said

cheque which was issued by their bank. The Exhibit-9 is the statement of

account of Ajay Bagor, account no.831010100006309, from period 01/04/10

to 31/03/11. Further in her Cross examination she stated that the handwriting

of the name SumirAgarwala, the amount in figure and words and the date in

Exhibit-6 and the handwriting of the signature of Ajay Bugor in the Exhibit-6

are not one and same. Handwriting expert may give opinion on handwriting.

The Exhibit-9 contains 3 pages. The opening date of account no.

831010100006309 is 01/09/2009.

14. The complainant proved Acknowledgment cum Undertaking which is marked

as Exhibit-1. He proved the money receipt which is marked as Exhibit-2. He

proved Money Receipt marked as Exhibit-3. He proved Demand Notice which

is marked as Exhibit-4. He proved the postal AD card which is marked as

Exhibit-5. He proved Cheque (005085) which is marked as Exhibit-6. He

proved Cheque return memo which is marked as Exhibit-7. He proved

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Demand Notice which is marked as Exhibit-8. He proved A/D card which is

marked as Exhibit-9.

15. In the instant case the oral evidence as well as the documentary evidence in

the formof the cheque (Exhibit-6) and return memo (Exhibit-7) adduced by

the complainant clearly shows that the cheque issued by the accused was

dishonoured due to insufficient fund in the account of accused. Further, the

documentary evidence in forms of undertaking (Exhibit-1), money receipts

(Exhibit-2 and Exhibit-3) shows that the accused had borrowed a total

amount of ₹ 400,000/- (Rupees four lakhs) and that there exists a legally

enforceable debt to be discharged by the accused.

16. The learned defence Counsel Mr. M.D. Sahewala argued that in Exhibit 1 and

Exhibit-3 the signatures of the alleged accused are neither exhibited nor

proved as executant and therefore, the Exhibit-1 and Exhibit-3 are valueless

and not admissible under the law.However. I am of the view that the Exhibit-

1 and Exhibit-3 should be read as a whole taking into consideration the

signatures of the accused person. The signatures of the accused may not

have been marked as exhibits but that does not render the Exhibit-1 and

Exhibit-3 invalid and valueless. In fact the signatures of the accused in the

said documents are apparently present, though the accused denied the

signatures in Exhibit-1, Exhibit-2 and Exhibit-3 to be his. The learned Counsel

for the complainant counter argued that the technical point such as not

proving the signatures of the accused in Exhibit-1 & Exhibit-3 is no more a

good law. The complainant side relied on the case law: BanwarilalVs.

Balbir Singh, reported in 2016(1) SCC-607-Dwherein Hon’ble Supreme

Court held that: Procedure is meant only to facilitate the administration of

justice and not to defeat the same. Thus in the light of the above proposition

of law, the failure to mark the signatures of the accused does not invalidates

Exhibit-1, Exhibit-2 and Exhibit-3

17. On the other hand the accused has not denied his signature in Exhibit-6 i.e.

the cheque. A comparison of the alleged signatures of the accused in Exhibit-

1, Exhibit-2 and Exhibit-3 with the admitted signature of the accused in

Exhibit-6 clearly shows that all the signatures in the said documents are

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similar in style and pattern and the signatures in the Exhibit-1, Exhibit-2 and

Exhibt-3 tally with the admitted signature of the accused in the cheque

(Exhibit-6). I did not find any discrepancy in the signatures, whatsoever. The

accused denied that the signatures in Exhibit-1, Exhibit-2 and Exhibit-3 are

his signatures.However, he did not send the signatures to Forensic Science

laboratory for seeking expert opinion in order rebut the prosecution’s

case.Therefore, considering the above facts and circumstances, I hold that

the Exhibit-1, Exhibit-2 and Exhibit-3 were duly executed by the accused.

18. It is argued by the learned defence Counsel that the complainant did not

produce the Exhibit-1, Exhibit-2 and Exhibit-3 at the time of filing the

complaint and suggested that the documents were forged subsequently.

However, I am of the opinion that the Exhibit-1, Exhibit-2 and Exhibit-3 are

not the most vital piece of documentary evidence in the instant case u/s 138

of the NI Act. The section 118 and 139 in Negotiable Instrument Act mandate

the Court to presume the fact of existence of legally enforceable debt on

issuance of cheque by the drawer. Therefore, presumption of existence of

legally enforceable debt can be drawn from the fact that a cheque has been

issued by the accused and the same bears the signature of the accused as a

drawer. The other documents in the forms of money receipts or undertaking

only fortifies the complainant’s case further.The documents like money

receipts or undertaking only lend credence to the complainant’s case. The

instant case is not based solely on money receipts and undertaking.

19. The learned defence Counsel argued that in evidence on affidavit of

SankarBorah (PW.2) the Exhibit-3 is dated 23/03/11 and therefore the

evidence on affidavit by PW.2 is apparently falsehood. I perused the evidence

on record a found that the PW.2 has mentioned the date of the execution of

Exhibit-3 as 23/03/11 in place of 23/03/10. I am of the opinion that it is a

mere slip of pen and the same does not in any way renders PW.2 unworthy

of trust.

20. It is further argued by the defence side that it is not believable that the

complainant kept lending money to the accused despite the fact that the

accused failed to repay the earlier loan. I am of the view that this is too trivial

an issue to discard the complainant’s case in toto.

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21. The defence side pleaded that the Exhibit-6 (Cheque) was issued by the

accused as security cheque at the time when the accused borrowed a sum of

only ₹ 40,000/- (Rupees forty thousand). It is argued that the complainant

misused the cheque (Exhibit-6) by inserting the amount of ₹ 400,000/-

(Rupees four lakhs). However, the accused has failed to show with cogent

evidence that the complainant had misused the cheque (Exhibit-6) which was

issued as a security measure.Be that as it may, in Bonanza Portfolio Ltd.

Vs. State of Assam &Anr. reported in 2015 (1) GLT 339 the

HonourableGauhati High Court has thus held: Even if one assumes for the

sake of argument that the cheque in question was issued only as a security,

and not in liquidation of a debt or other liability, yet, in view of law laid down

in I.C.D.S Ltd Vs BeenaShabeer&Anr. reported in (2002) 6 SCC 426, such a

plea is required to be rejected. In this context, it needs to be stated that the

question whether a guarantor who issued a cheque as a security towards

some collateral transactions could be prosecuted in the event of dishonour of

such cheque had come up for consideration of the Apex Court in the case of

I.C.D.S Ltd (supra).The HonourableGauhati High Court in the said case has

also held that: The plea that a particular cheque was issued not in liquidation

of any debt but as a security towards some collateral transactions between

the parties can no longer be accepted as legally tenable prayer in view of

decision in ICDS Ltd (supra). Resultantly, I have no other option but to hold

that the plea of the accused person that he had issued the cheque, not in

liquidation of any debt, but only as a security towards some collateral

transactions could hardly provide any breather to the accused person in a

proceeding U/s 138 of the NI Act.

22. The Honorable Supreme Court of India in ICDS Ltd Vs.

BeenaShabeer&Anr. reported in (2002) 6 SCC 426 has thus held, with

regard to the language in section 138 of the Negotiable Instruments

Act: The language, however, has been rather specific as regards the intent of

the legislature. The commencement of the Section stands with the words "

Where any cheque" The above noted three words are of excrement

significance, in particular, by reason of the user of the word "any"-the first

three words suggest that in fact for whatever reason if a cheque is drawn on

any account maintained by him with a banker in favour of another person for

the discharge of ay debt or other liability, the highlighted words if read with

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the first three words at the commencement of Section 138, leave no manner

of doubt that for whatever reason it may be, the liability under this provision

cannot be avoided in the event the same stands returned by the banker

unpaid. The legislature has been careful enough to record not only discharge

in whole or in part of any debt but the same includes other liability as well.

This aspect of the matter has not been appreciated by the high Court, neither

been dealt with or even referred to in the impugned judgment. The issue as

regards the coextensive liability of the guarantor and the principle debtor, in

our view, is totally out of the purview of Section 138 of the Act, neither the

same calls for any discussion therein. The language of the Statute depicts the

intent of the law makers to the effect that wherever there is a default on the

part of one in favour of another and in the event a cheque is issued in

discharge of any debt or other liability there cannot be any restriction or

embargo in the matter of application of the provision of Section 138 of the

Act: 'Any cheque' and ' other liability' are the two key expressions which

stands as clarifying the legislative intent so as to bring the factual context

within the ambit of the provisions of the Statute. Any contra interpretation

would defeat the intent of the legislature.

23. Therefore, in view of the above proposition of law as laid down by the

Honourable Supreme Court of India I hold that the plea of the accused

person that he had issued the cheque (Exhibit-6), not in liquidation of any

debt, but only as a security measure at the time of availing the loan could

hardly provide any breather to the accused person in the instant proceeding

u/s 138 of the NI Act.

24. It is vehemently argued by the learned defence Counsel that there is no any

legal evidence of any other witness and evidences on affidavit are not legal

as per law in the instant case. That there is no any signature of the Court on

the evidence on affidavit of the complainant and his witnesses. That the

simple signature of the Court on the first page is not sufficient and the

evidence of the complainant SumirAgarwalla as well as evidence of witness

Rajesh Chandak, Sankar Borah have no evidentiary value. I perused the

examination-in-chief of the complainant and his witnesses viz. PW.2 and

PW.3 and found that only the first page of the evidence on affidavit of the

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complainant and his witnesses (PW.2 and PW.3) bears the signature of the

Court and the remaining pages do not bear the signature of the Court.

However, the learned Counsel for the complainant argued that it is a curable

defects and mistake on the part of the Court cannot take away the legal

right of the complainant. In order to buttress his claim the learned Counsel

for the complainant relied on Md. Motiur Rahman vs. Ramjan Ali

reported in 2001 (2) GLR 576. In this case the HonourableGauhati High

Court held that omission to sign the exhibit accepted by both the parties as

a piece of document and marked in presence of both parties and failure to

sign the document by the presiding officer will not vitiate the judgment.

Therefore, in the light of the above proposition of law, I am of the view that

omission or failure to sign each and every page of the evidence on affidavit

would not in any way vitiate this trial as the omission or rather the failure

was on the part of the presiding officer. The complainant is not at fault here.

25. It is further argued by the learned defence Counsel that the signature and

the other writings in Exhibit-6 (Cheque) are completely different and that

can be seen by naked eye and therefore, it is argued that the Exhibit-6

which was a security cheque was misused by the complainant for his

wrongful gain. The defence side relied upon the case law: M.D.

Ramakrishnaiah vs. V. Javaregowda, reported in 2014 (1) Civil LJ

269. In his counter argument the learned Counsel for the complainant

submitted that writings of the date, cheque amount excepting the signature

of the accused on the cheque cannot take away the legal right of the

complainant over the subject cheques. Section 20 of the NI Act has been

reproduced herein reading----------- “Section 20- Inchoate stamped

instruments.--- Where one person signs and delivers to another a paper

stamped in accordance with the law relating to negotiable instruments then

in force in [India], and either wholly blank or having written thereon an

incomplete negotiable instrument, he thereby gives prima facie authority to

the holder thereof to make or complete, as the case may be, upon it a

negotiable instrument, for any amount specified therein and not exceeding

the amount covered by the stamp. The person so signing shall be liable

upon such instrument, in the capacity in which he signed the same, to any

holder in due course for such amount: Provided that no person other than a

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holder in due course shall recover from the person delivering the instrument

anything in excess of the amount intended by him to be paid thereunder.”

26. Be that as it may I perused the Exhibit-6 and found that the signature and

other writings in Exhibit-6 are different but then this very fact cannot lead to

the presumption that the complainant had misused the security cheque. In

fact there is no cogent evidence to show that the cheque had been misused.

In fact in the foregoing paragraph I have dealt with the settled proposition

of law with regard to security cheque.

27. The learned defence Counsel also argued that the cross examination of

the PW.2 and PW.3 reveal that the Exhibit-1, Exhibit-2 and Exhibit-3 are

forged documents and that the PW.2 and PW.3 helped the complainant in

preparation of said forged documents. It is argued that the PW.2 in his

cross examination admitted that he did not know where Exhibit-1 and

Exhibit-3 were prepared. That he signed the exhibits before the

MaghBihuof 2009 and 2010 but Exhibit- 1 is dated 16/08/09 and Exhibit-3

is dated 23/03/10 but MaghBihu falls in January. Therefore, the PW.2 is

not worthy of belief with regard to the fact that he witnessed the accused

borrowing money by executing Exhibit-1 and Exhibit-3. The Exhibit-1 was

executed way back 16/08/2009 and Exhibit-3 was executed on 23/03/10

and therefore, it is not humanely possible to remember each and every

detail of an event which took place some 7 or 8 years back. I do not find

PW.2 untrustworthy.

28. The accused has filed his written statement in the instant case wherein he

stated that the complainant in connivance with the PW.2 Sankar Borah and

PW.3 Rajesh Chandak is carrying on money lending business at high rate

without any licence. It is stated that the complainant takes blank security

cheques from the innocent borrowers and then fills in exorbitant amount in

the cheques with the help of his associates Sankar Borah and Rajesh

Chandak. Thus the complainant is cheating the borrowers. However, I do not

find force in this argument as there is no such cogent evidence on record to

show that the complainant is a money lender and that too a money lender

without any licenceand that he with the help of PW.2 Sankar Borah have

been cheating the poor vulnerable people. The accused in his statement

recorded u/s 313 of the Cr.P.C. stated that he has been paying interest on

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the borrowed amount but then he failed to prove this fact by cogent evidence

or by bringing forth such facts and circumstances to prove that said fact.

Therefore, the accused is not worthy of belief when he says that the

complainant is a money lender who has defrauded him.

29. The accused has filed the certified copy of cross examination of complainant

in CR case no.205/10 against the accused AjoyBagor. The same is marked as

Exhibit-A. The accused also filed certified copy of the evidence adduced by

the complainant and his witness Sankar Borah in CR case no.181/10. The

same is marked as Exhibit-B. It is argued by the learned defence counsel that

the complainant’s witness Sankar Borah in the said CR case no 181/10 had

admitted that he had filled in the disputed cheques and therefore, it is proved

that the complainant with the help of Sankar Borah takes blank security

cheques from vulnerable needy people and fills in the cheques with

exorbitant amounts in order to defraud the hapless borrowers. However, I do

not find any force in this argument as the disputed cheque (Exhibit-6) and

the Exhibit-1, Exhibit-2 and Exhibit-3 amply proves that there exists a legally

enforceable debt for the accused to be discharged.

30. The Section 118 - Presumptions as to Negotiable Instruments says: Until the

contrary is proved, the following presumptions shall be made: (a) of

consideration. - that every negotiable instrument was made or drawn for

consideration, and that every such instrument, when it has been accepted,

indorsed, negotiated or transferred, was accepted, indorsed, negotiated or

transferred for consideration; (b)as to date.- that every negotiable

instrument bearing a date was made or drawn on such date; (c) as to time

of acceptance. - that every accepted bill of exchange was accepted within a

reasonable time after its date and before its maturity;(d) as to time of

transfer. - that every transfer of a negotiable instrument was made before

its maturity;(e) as to order of indorsements. - that the indorsements

appearing upon a negotiable instrument were made in the order in which

they appear thereon; (f) as to stamp. - that a lost promissory note, bill of

exchange or cheque was duly stamped; (g) that holder is a holder in due

course. - that the holder of a negotiable instrument is a holder in due

course; Provided that, where the instrument has been obtained from its

lawful owner, or from any person in lawful custody thereof, by means of an

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offence or fraud, or has been obtained from the maker or acceptor thereof by

means of an offence or fraud, or for unlawful consideration, the burden of

proving that the holder is a holder in due course lies upon him.

31. The section 139 of the Negotiable Instruments Act, 1881 says: It shall be

presumed, unless the contrary is proved that the holder of a cheque received

the cheque of the nature referred in section 138 of the act for the discharge,

in whole or in part, of any debt or other liability.

32. The Hon’ble Supreme Court of India in the reported case ofM/S. Kumar

Exports vs M/S. Sharma Carpets, (2009) 2 SCC 513,while discussing

the presumption also laid down the law as to what amount to rebuttal and

the effect of non-rebuttal by the accused on the following words..............

The use of the phrase "until the contrary is proved" in Section 118 of the Act

and use of the words "unless the contrary is proved" in Section 139 of the Act

read with definitions of "may presume" and "shall presume" as given in

Section 4 of the Evidence Act, makes it at once clear that presumptions to be

raised under both the provisions are rebuttable. When a presumption is

rebuttable, it only points out that the party on whom lies the duty of going

forward with evidence, on the fact presumed and when that party has

produced evidence fairly and reasonably tending to show that the real fact is

not as presumed, the purpose of the presumption is over. The accused in a

trial under Section 138 of the Act has two options. He can either show that

consideration and debt did not exist or that under the particular

circumstances of the case the non-existence of consideration and debt is so

probable that a prudent man ought to suppose that no consideration and

debt existed. To rebut the statutory presumptions an accused is not expected

to prove his defence beyond reasonable doubt as is expected of the

complainant in a criminal trial. The accused may adduce direct evidence to

prove that the note in question was not supported by consideration and that

there was no debt or liability to be discharged by him. However, the court

need not insist in every case that the accused should disprove the non-

existence of consideration and debt by leading direct evidence because the

existence of negative evidence is neither possible nor contemplated. At the

same time, it is clear that bare denial of the passing of the consideration and

existence of debt, apparently would not serve the purpose of the accused.

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Something which is probable has to be brought on record for getting the

burden of proof shifted to the complainant. To disprove the presumptions,

the accused should bring on record such facts and circumstances, upon

consideration of which, the court may either believe that the consideration

and debt did not exist or their non-existence was so probable that a prudent

man would under the circumstances of the case, act upon the plea that they

did not exist. Apart from adducing direct evidence to prove that the note in

question was not supported by consideration or that he had not incurred any

debt or liability, the accused may also rely upon circumstantial evidence and

if the circumstances so relied upon are compelling, the burden may likewise

shift again on to the complainant. The accused may also rely upon

presumptions of fact, for instance, those mentioned in Section 114 of the

Evidence Act to rebut the presumptions arising under Sections 118 and 139

of the Negotiable Instruments Act. The accused has also an option to prove

non-existence of consideration and debt or liability either by letting in

evidence or in some clear and exceptional cases, from the case set out by the

complainant, that is, the averments in the complaint, the case set out in the

statutory notice and evidence adduced by the complainant during the trial.

Once such rebuttal evidence is adduced and accepted by the court, having

regard to all the circumstances of the case and the preponderance of

probabilities, the evidential burden shifts back to the complainant and,

thereafter, the presumptions under Sections 118 and 139 of the Act will not

again come to the complainant's rescue.

33. In the reported case of Raman Finance Corpn. Vs Harmeet Singh

reported in 2007(2)ALD(Cri)5, it is held that in the case u/s 138 of N.I.

Act the complainant has been put in a better platform than the accused by

incorporating section 118 and 139 in Negotiable Instrument Act. Both the

sections mandate to presume the fact of existence of legally enforceable debt

on issuance of cheque by the drawer. However the presumption is rebuttable

and to rebut the statutory presumptions, an accused is not expected to prove

his defence beyond reasonable doubt as is expected of the complainant in a

criminal trial. The accused may adduce direct evidence to prove that the

cheque in question was not supported by consideration and that there was no

debt or liability to be discharged by him.

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34. In the instant case the accused in order to disprove the presumptions, has

failed to bring on record any such fact and circumstance to show that the

consideration and debt did not exist or their non-existence is so probable that

a prudent man would under the circumstances of the case, act upon the plea

that they did not exist.

35. The accused has claimed that the signatures inExhibit-1, Exhibit-2 and

Exhibit-3are not his signatures but he has not sought the help of handwriting

expert to prove that the signatures in the said documents are forged. It is the

accused who has claimed forgery of his signature and so, theonus is upon

him prove the alleged forgery with help of the handwriting expert. But he

kept quiet and did not seek help of hand writing expert. Thus the accused

has failed to prove that his signatures which in Exhibit-1, Exhibit-2 and

Exhibit-3 are forged. Furthermore, the fact that the Exhibit-6 (Cheque) was

dishonoured due to insufficient fund in the account of the accused is not

disputed by the accused at all. Therefore, the presumption envisaged in

Section 118 of the Act can legally be inferred that the cheque (Exhibit-6) was

drawn for consideration on the date which the cheque bears. The Section

139 of the Act enjoins on the Court to presume that the holder of the cheque

received it for the discharge of any debt or liability. The Hon’ble Supreme

Court of India in K. Bhaskaran v. SankaranVaidhyanBalan&Anr, reported in

AIR1999SC3762, held thatthe burden is on the accused to rebut the aforesaid

presumption. But the accused, in the instant case, clearly failed to discharge

this burden.

36. In the instant case the accused has failed to prove the non-existence of

consideration and debt or liability with cogent evidence or by way of cross

examination of the complainant.Therefore, this Court presumes that the

complainant (holder of the cheque) received the cheque (Exhibit-6) for the

discharge of debt or liability on the part of the accused.

37. Furthermore, in Hindustan Apparel Industries vs. Fair Deal Corporation, New

Delhi reported in AIR 2000 Gujarat 261, the full bench of Hon’ble Gujarat

High Court held that payment by cheque which if dishonoured would amount

to acknowledge of a debt and a liability. In the instant case, the accused has

failed to cast a doubt on the veracity of the complainant’s case. Therefore, in

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view of the above propositions of law, it can well be concluded that the

accused had issued the cheque (Exhibit-6) to discharge his debt.

38. The learned defence Counsel further argued that the complainant has

violated the provisions of Income Tax Act. The learned defence Counsel

vehemently argued that if the complainant has extended the loan of ₹

400,000/- to the accused then he had violated the provisions of the Income

Tax Act and thus the debt is not legally enforceable debt. The defence

Counsel has relied upon Krishna JanardhanBhat vs. Dattatraya G. Hegde,

reported in (2008) 2 Supreme Court Cases (Cri) 166 and emphasized that in

terms of Section 269SSof the Income Tax Act, any advance taken by way of

any loan of more than ₹ 20,000/- was to be made by way of an account

payee cheque only. That the section 27ID of the Income Tax Act says: If a

person takes or accepts any loan or deposit in contravention of the provisions

of Section 269SS of Income Tax Act, he shall be liable to pay, by way of

penalty, a sum equal to the amount of the loan or deposit so taken or

accepted. As per the section 27ID of the Income Tax Act the complainant is

not the violator but the accused is the violator as it is he who had accepted or

taken the loan amount in violation of the provisions of Income Tax Act. The

accused is guilty of violating the provision of section 269SS of Income Tax Act

as he has received the loan. However, this Court is not empowered to take

any action against the accused for violation of Section 269SS of Income Tax

Act. Any penalty imposable for violation of Section 269SS of Income Tax Act

shall be imposed by the Joint Commissioner. The income Tax department is

at liberty to draw any proceeding against the accused if he is found to have

violated the provisions of the Income Tax Act.

39. In the above noted case Krishna JanardhanBhat vs. Dattatraya G. Hegde,

reported in (2008) 2 Supreme Court Cases (Cri) 166 the Ratio Decidendi that

the hon’ble Supreme Court has laid down is that: Presumption of innocence

as human rights and the doctrine of reverse burden introduced by Section

139 should be delicately balanced and would largely depend upon the factual

matrix of each case, the materials brought on record and having regard to

legal principles governing the same. The standard of proof so as to prove a

defence on the part of an accused is preponderance of probabilities. The

question as to whether the presumption stood rebutted or not, must be

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determined keeping in view the other evidences on record.However, it is not

a ratio decidendi in the said case that loan extended in violation of the

provisions of Income Tax Act is not legally enforceable. Therefore, it is not

binding upon this Court to draw conclusion that the debt in the instant case is

not legally enforceable in view of violation of the provisions of the Income

Tax Act. In the case at hand the complainant has clearly proved with oral as

well as documentary evidence that the accused had availed the loan and

issued the cheque (Exhibit-6) to discharge his legally enforceable debt or

liability.

40. In the light of the above discussion of evidence on record, I hold that the

complainant has successfully established that the accused person issued the

cheque (Exhibit-6) to the complainant for the discharge of legally enforceable

debt and the cheque (Exhibit-6) was dishonoured due to insufficient fund in

the saving bank account maintained by the accused person in Axis Bank Ltd.

Sivasagar. Therefore, this point of determination is answered in affirmative

and decided in favour of the complainant.

POINT FOR DETERMINATIO NO.2:Whether the accused person received

the demand notice issued by the complainant regarding the dishonour of the

cheque?

41. So far so good, but what needs to be seen now is whether the complainant

followed all the provisos to the section 138 of the Negotiable Instruments Act

before filing the instant case against the accused. The complainant in his

complaint petition as well as in his evidence stated that on 02/09/10 he

issued an advocate’s notice to the accused person demanding payment of the

cheque amount within fifteen days from the date of receipt of notice. That

the accused received the notice on 03/09/10 but he did not make the

payment of the cheque amount within fifteen days and so, he filed the instant

case on 05/10/10, well after the expiry of fifteen days but before the expiry

of thirty days.

42. In the instant case the accused has not denied the receipt of Advocate’s

demand notice which is marked as Exhibit-8. However, the Exhibit-9 which is

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the Postal Acknowledge card amply proves that the accused received the

notice as the Exhibit-9 bears the signature of the accused. I compared the

accused person’s signature on Postal Acknowledge card (Exhibit-9) with the

admitted signature of the accused in the cheque (Exhibit-6)and found that

the signatures are same. Hence, it is proved that the accused had received

the demand notice. Therefore, this point of determination is also answered in

affirmative and decided in favour of the complainant.

POINT FOR DETERMINATION NO.3:Whether the accused person has

committed the offence under section 138 of the Negotiable Instruments

Act,1881?

43. The offence punishable under section 138 of the Negotiable Instruments Act,

1881 is completed on the satisfaction of certain conditions which are that the

cheque has to be issued on the account maintained by the accused in a bank

and that the cheque has to be issued for the discharge of a debt or liability. It

is further provided that the said cheque has to be deposited within six

months of its issuance or within its validity and that the notice regarding the

dishonour of the cheque for insufficient funds ought to be given within 30

days of the receipt of information regarding the dishonour. In the instant

case at hand it is already held that the cheque (Exhibit-6) was issued by the

accused personbut thecheque wasdishonoured. The cheque (Exhibit-6) was

dated 20/07/10. The cheque return memo (Exhibit-7) proves that the said

cheque (Exhibit-1) was returned on 25/08/2010 and that the demand notice

was issued by the complainant on 02/09/2010, which is within 30 days from

the receipt of information of dishonour. The accused received the Advocate’s

demand notice on 03/09/2010as evident from Exhibit-9 which is the postal

Acknowledgment Card. The instant case was instituted on 05/10/10, which is

within one month after the lapse of 15 (fifteen) days from the date of receipt

of demand notice by the accused; hence the complaint is lodged within the

period of limitation.

44. In the instant case the complainant has claims to be a businessman and the

accused has not refuted the capacity of the complainant to lend the cheque

amount as loan to him.Hence, I hold that the complainant is financially

capable of extending the cheque amount as loan to the accused person.

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Further, the complainant has duly proved that the accused issued him the

cheque (Exhibit-6) for the discharge of a debt. Further, this Court presumes

u/s section 139 of the Negotiable Instruments Act, 1881 that the complainant

who is the holder of a cheque received the cheque for the discharge of

debtor liability on the part of the accused. The accused has failed to rebut

this presumption.It is, therefore, concluded that all the ingredients of the

offence punishable under section 138 of the Negotiable Instruments Act,

1881 are satisfied in the instant case and further the complainant has

satisfied all the requisites for the institution of the instant case.

45. In the light of the above discussion of evidence and upon full appraisal of the

evidence on record, coupled with my above reasons I am constrained to hold

that the complainant has proved beyond all reasonable doubts that the

accused Abhoy Bogor is guilty of committing an offence punishable under

section 138 of the Negotiable Instruments Act, 1881. Hence, the accused

Abhoy Bogoris convicted under section 138 of the Negotiable Instruments

Act, 1881.

46. The offence committed by the convict is in the nature of an economic offence

and the backbone of the nation depends on a healthy economy. Moreover the

real intention behind the enactment of the legislation is to provide quick

remedy to the payee or the holder of the cheque, and also to instil a sense of

confidence and assurance to the business community.If the benefit of

Probation of Offenders Act is given to the convict, it will go against the spirit

of the legislation. Therefore, I am not inclined to extend the benefit of the

provisions of the Probation of Offenders Act, 1958 to the convict.

Order

47. I am of the opinion that imposition of fine only would meet the ends of

justice. Therefore, considering all aspects the convictAbhoy Bogor sentenced

to pay a fine of ₹600,000/- (Rupees six lakhs) for his conviction u/s 138 of

the Negotiable Instruments Act, 1881 and in default of payment of fine

amount theconvict shall undergo simple imprisonment for a period of one

year. The amount of fine, if realized, shall be paid in full to the complainant.

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48. The convict is informed of his right to appeal against the order and judgment

of conviction.

49. The case is disposed of on contest.

Given under my hand and the seal of this court on this the 28thday of July,

2017 at Sivasagar.

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APPENDIX

CR (NI) CASE NO. 204/2010U/s 138, Negotiable Instruments Act, 1881.

Complainant’s witnesses:

1. SumirAgarwalla (Complainant)…………………………...PW.1.

2. Sankar Borah……………………....…………………………...PW.2.

3. Rajesh Chandak………………………………………………...PW.3.

4. Shehnaz Yasmin ……………………………………………………...PW.4.

Documents exhibited by Complainant:

1. Acknowledgment cum Undertaking.....................Exhibit-1.

2. Money Receipt………………………………………………..Exhibit-2.

3. Acknowledgment cum Undertaking…………………..Exhibit-3.

4. Demand Notice.................................................Exhibit-4.

5. Postal Card.......................................................Exhibit-5.

6. Cheque (005089)………………………..….……………...Exhibit-6.

7. Cheque return memo……………………………………...Exhibit-7.

8. Demand Notice……………………………………..……….Exhibit-8.

9. A/D card…………………………………………………….….Exhibit-9.

Defence Witness: Nil

Documents exhibited by Defence:

1. Exhibit-A…………Certified copy of cross examination of complainant in CR

case no.205/10 against the accused AjoyBagor.

2. Exhibit-B………….Certified copy of the evidence adduced by the complainant

and his witness Sankar Borah in CR case no.181/10.

Case laws cited by Complainant :Banwarilal Vs. Balbir Singh, reported in

2016(1) SCC-607-D; Md. Motiur Rahman Vs. Ramjan Ali reported in 2001(2)

GLR-576; Standard Chartered Bank VS. Andhra Bank Financial Services Ltd

reported in 2016(2)SCC-207(E); M.S. Narayana Menon Alias Mani Vs. State of

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Kerala and Another reported in 2006(6)SCC-39; BS Sheshagiri Shetty and

Others vs. State of Karnataka and others reported in 2016(2)SCC-123(F);

BanwariLal (dead) by Legal Representatives and another vs. Balbir Singh

reported in 2016(1)SCC-607(D); and Haryana State Cooperative Supply and

Marketing Federation Limited vs. Jaya Textiles and another reported in

2014(4)SCC-704.

Case laws cited by defence: MD Ramakrishnaiah vs. V. Javaregowda reported in

2014 (1) Civil LJ 269; Krishna JanrdhanBhat vs. Dattaraya Hedge, reported in (2008)

4 SCC 54; K Prakashan vs. PK Surendran reported in 2008 (1) SCC 258; Tahar N.

Khambati vs. M/s Vinayak Enterprise; Smti. Rumi Hazarika vs. AnirbanHatikakoty,

reported in 2016 (1) GLJ 251; C. Antony vs. KG Raghavan, reported in AIR 2003 SC

182; MS Narayana Menon Vs. State of Kerala, reported in (2006) 6 SCC 39; and

Reverend Mother Marykutty vs. Reni C. Kottaram, reported in (2013) 1 SCC 327.