Cheque; Suresh Chandra Goyal Vs. Amit Singhal [Delhi High Court, 14-05-2015]

Negotiable Instruments Act, 1881 – Section 138 – Security Cheque – NI Act does not distinguish between a cheque issued by the debtor in discharge of an existing debt or other liability, or a cheque issued as a security cheque on the premise that on the due future date the debt which shall have crystallized by then, shall be paid. So long as there is a debt existing, in respect whereof the cheque in question is issued the same would attract Section 138 of NI Act in case of its dishonour. Thus, the defence that the cheques were issued as “security” cheques has no force.

Security Cheque


IN THE HIGH COURT OF DELHI AT NEW DELHI

CORAM: HON’BLE MR. JUSTICE VIPIN SANGHI

14.05.2015

CRL.L.P. 706/2014

SURESH CHANDRA GOYAL ….. Petitioner Through: Mr. Kshitij Sharda, Advocate. versus AMIT SINGHAL ….. Respondent Through: Mr. Aman Bhalla, Advocate.

JUDGMENT

VIPIN SANGHI, J.

1. After hearing learned counsel, leave granted.

2. Let the appeal be registered and numbered.

Crl.A. No. /2015 (to be registered and numbered)

3. I heard learned counsel finally at the admission stage with their consent and reserved judgment. Accordingly, I now proceed to dispose of the appeal.

4. The present appeal is directed against the judgment dated 15.09.2014 passed in complaint No. 96/2012, whereby the learned Metropolitan Magistrate, Karkardooma Courts, Delhi, has acquitted the respondent- accused of the offence under

Section 138 of the Negotiable Instruments Act, 1881 (NI Act).

5. The case of the complainant, as emerging from the complaint and the evidence led by the complainant, was that the complainant had invested monies, from time to time, in the business of the accused. A sum of Rs.3 Lakhs was outstanding after accounting for the monies returned by the accused to the complainant. The accused – acting as the first party, entered into a Memorandum of Understanding (MOU) dated 26.06.2011 with the appellant – acting as the second party, for return of the said remaining investment of Rs.3 lakhs to the complainant. The relevant extract of the MOU (Ex.CW-1/4), inter alia, reads as follows:

“……………..

and whereas the second party Sh. Suresh Chandra Goyal has invested a sum of Rs. 3,00,000.00 (Rs. Three Lakhs only) in the month of June, 2010 and onwards by cash & various cheques by way of partnership on 50-50% basis. The Partnership was broken by way of mutual consent in first week of December, 2010.

and whereas both the parties agreed that First party will return full amount of Rs. 3,00,000/- (Rs. Three Lakhs only) to Second Party Sh. Suresh Chandra Goyal in six instalment of Rs. 50,000.00 (Rs. Fifty thousand only) by way of six monthly cheque starting from December, 2011 and Second Party Suresh Chandra Goyal will return all security cheque drawn in favour of second party, if any. It is also agreed upon by all the parties that interest @ 1.5% per month will be charged if there is any delay in getting the cheques cleared by the first party.”

6. Thus, the complainant held six cheques of Rs. 50,000/ each, given by the accused in terms of the MoU (Ex.PW1/4). The appellant/complainant admitted the receipt of Rs.1.50 lakhs out of the aforesaid amount. Three cheques in respect thereof were returned to the accused when the said amount of Rs. 1.50 lakhs was returned in installments of Rs. 50,000/- each. The appellant/complainant claimed that the accused, in order to repay the remaining amount of Rs. 1.50 Lakhs issued three cheques of Rs. 50,000/- each, bearing Nos. 864160, 864161 & 864162 dated 15.01.2012, 15.02.2012 & 15.03.2012 respectively, drawn on Axis Bank, Preet Vihar Branch, Delhi, in favour of the appellant, which were exhibited as Ex.CW1/1, CW1/2 and CW1/3. The said cheques were presented and were dishonoured upon presentation on account of insufficient funds. After issuance of the statutory notice dated 04.08.2012 under Section 138 NI Act, since the accused did not make payment, the complaint was preferred. The accused admitted, while making his statement under Section 251 Cr.P.C., that he was liable to make payment to the appellant/ complainant of Rs.60,000/-, but denied that the liability was Rs.1,50,000/-.

7. The submission of learned counsel for the appellant is that the learned Magistrate, while acquitting the accused, has given two reasons in the impugned judgment. The first is that the petitioner has not been able to establish that a debt was owed by the accused towards the appellant-thus, it could not be said that the cheques Exs.CW1/1, CW1/2 and CW1/3 were issued in discharge of a debt; secondly, the learned Magistrate had held that the cheques in question were given as security cheques and, therefore, could not form the basis of a complaint underSection 138 of the NI Act.

8. In respect of the first reason, the submission of learned counsel for the appellant is that MOU (Ex.CW-1/4) itself reflects the debt owed by the accused, and the undertaking given by him that the same shall be returned in six monthly installments from December, 2011, onwards of Rs. 50,000/- each. Learned counsel submits that in the face of the acknowledgement of debt contained in the MOU (Ex.CW-1/4), and the statement of the accused that he was indebted to the appellant/complainant – though to the extent of Rs.60,000/- and not Rs.1.50 lakhs, the exercise undertaken by the learned Magistrate to ascertain whether the accused was indebted to the appellant, and the doubt entertained by the learned Magistrate with regard to the said debt, itself was misdirected, and it was not open to Magistrate to go behind the MOU (Ex.CW-1/4) to make an inquiry as to whether, or not, the debt existed.

9. The further submission of learned counsel for the appellant is that the MOU (Ex.CW-1/4) itself recorded that the repayment had to be made in six monthly installments. He submits that the learned Magistrate has placed reliance on the cross-examination of the appellant, who was examined as CW-1, as also the language used in MOU (Ex.CW-1/4) – to the effect that the complainant/ appellant shall return the security cheques drawn in his favour, upon the installments being paid- to hold that the cheques in question were “security cheques;” and were not meant for payment of a legally recoverable debt. Learned counsel has referred to the cross- examination of the appellant’s/ complainant’s witness to submit that the accused never challenged the genuineness, or authenticity of the MOU (Ex.CW-1/4). In fact, the suggestion was that the complainant had received a sum of Rs. 1.50 Lakhs in respect of the outstanding liability/ debt of Rs. 3 Lakhs. The further submission of the appellant is that the statement of the accused that the outstanding liability was only to the tune of Rs.60,000/- and not Rs.1.50 lakhs, was his mere ipse dixit, which was not shown to be even probably true. The same did not dislodge the presumption under Section 118 and 139 of the NI Act, which arose on account of the indisputed position that the cheques Ex.CW1/1, CW1/2 and CW1/3 had been issued/signed by the accused drawn from the bank account maintained by him.

10. On the other hand, the submission of learned counsel for the accused supports the impugned judgment. He submits that the appellant could not establish the availability of monetary liquidity with him, to show that he had advanced any loan, and that Rs. 3 Lakhs was outstanding. The claim made by the appellant/ complainant, that he had earlier too advanced a loan of Rs. 3 Lakhs, out of which only Rs. 2 Lakhs had been returned was not believable, as there was no reason for the petitioner to invest a further amount in the business of the accused – when the initially invested amount had not been fully returned. He further submits that the petitioner had admitted during his cross-examination that the cheques in question had been given as security cheques. He has placed reliance on the decisions taken note of in the impugned judgment as well as on the decision of Supreme Court in