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IN THE COURT OF MS.DIVYA ARORA, METROPOLITAN

MAGISTRATE (N.I.ACT)-01, SOUTH WEST DISTRICT,
DWARKA COURT COMPLEX, DELHI

CRIMINAL COMPLAINT NO.16104 OF 2020

IN THE MATTER OF:-
Japjeet Singh …Complainant
VERSUS
Naveen Rana …Accused
MEMORANDUM OF WRITTEN
ARGUMENTS ON BEHALF OF
COMPLAINANT U/s 314 Cr.P.c
BRIEF FACTS:-

1. That the complainant and accused are on friendly terms

and taking advantage of the trust, the accused took a loan
of Rs.7,50,000/- and pursuant to partial discharge of
liability of the accused, the accused gave a cheque
No.571753 of Rs.1,90,000/- drawn on SBI, Branch
Bijwasan which was deposited by the complainant for
encashment at Standard Chartered Bank, Janakpuri, New
Delhi on 28/07/2020. and same was returned unpaid vide
Memo dated 11/08/2020 with an endorsement showing
“Account Closed”. The statutory legal notice dated
31/08/2020 was sent by registered post on 08/09/2020
as per law and same was duly served on the accused
person and the same was replied by the accused through
his counsel and the complaint under Section 138 of NI Act
was filed before this Hon'ble Court on 04/11/2020.

2. That after PSE on 07/04/2022, this Hon'ble Court took

cognizance of the offence against the accused person after
condoning the delay in filing of the complaint pursuant to
the direction of the Hon'ble Apex Court in re Suo-Moto writ
petition (C) No.3/2020 cognizance for extension of time and
issued summons to the accused.
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3. On 06/08/2022, the a notice U/s.251 Cr.P.C. was framed

against the accused, to which he pleased not guilty and
claimed trial. Further, statement U/s.294 of Cr.P.C. was
also recorded on the same date.

4. On 05/11/2022, application U/s.145(2) of NI Act was

moved on behalf of the accused which was suitably replied
by the complainant and he recorded no objection if the
application is allowed only qua para No.6 to 10 of the
application.

5. That on 05/11/2022, the CW-1 was examined in chief,

cross-examined and discharged and his CE was closed.

6. That on 03/01/2023, statement of the accused U/s.313

Cr.P.C. was recorded. While reiterating his defence
U/s.251 of Cr.P.C. He inter-alia stated that he has only
taken Rs.1,90,000/- from the complainant and which has
been returned to him through Banking Channels. The
cheque in question was a security cheque which was not
returned to him despite his repeated oral requests.

7. That on 17/01/2023, accused moved an application

U/s.315 of Cr.P.C. alongwith list of witnesses and
pursuant to which his DE was conducted and DW1 was
examined, cross-examined and discharged.

8. EVIDENCE ADDUCED BY THE COMPLAINANT.

8.1 Complainant only examined himself as a witness and

exhibited following documents:-

(i) Ex.CW-1/1 original Cheque No.571753 dated

28/07/2020.
(ii) Ex.CW-1/2 original Return Memo dated 11/08/2020.
(iii) Ex.CW-1/3 legal notice dated 31/08/2020.
(iv) Ex.CW-1/4 original postal receipts dated 08/09/2020.
(v) Ex.CW-1/5 original returned envelopes.
(vi) Ex.CW-1/6 original reply to the legal notice.

9. DEFENCE OF THE ACCUSED:-

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9.1 The accused had only taken a defence that he had taken a
loan of Rs.1,90,000/- by him which had been repaid by
him while taking different defences at the times of framing
of notice U/s.251 of Cr.P.C. which were contrary to his
defence in 145(2) Cr.P.C. application of the accused which
was only partially allowed by this Hon'ble Court i.e. only
paragraphs 6 to 10 were allowed to be taken in defence.

9.2 That thereafter, the complainant examined himself as

CW1. He was cross-examined and discharged.

10. LEGAL SUBMISSIONS:-

10.1. The ingredients which are to be satisfied for making out a

case under Section 138 NI Act, are being reproduced
hereunder:-

First Ingredient: The cheque was drawn by a person on an

account maintained by him/her for payment of money and
the same is presented for payment within a period of 3
months from the date on which it is drawn or within the
period of its validity;

Second Ingredient: The cheque was drawn by the drawer

for discharge of any legally enforceable debt or other liabil-
ity;

Third Ingredient: The cheque was returned unpaid by the

bank due to either insufficiency of funds in the account to
honour the cheque or that it exceeds the amount arranged
to be paid from that account on an agreement made with
that bank;

Fourth Ingredient: A demand of the said amount has been

made by the payee or holder in due course of the cheque
by a notice in writing given to the drawer within thirty days
of the receipt of information of the dishonour of cheque
from the bank;

Fifth Ingredient: The drawer fails to make payment of the

said amount of money within fifteen days from the date of
receipt of notice.
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the first, third, fourth and fifth ingredient have been duly
proved without there being any real controversy regarding
the same:

(a) The complainant has proved the original cheque,

Ex.CW1/1, which the accused has not disputed as
the same has admittedly been drawn from his ac-
count. It is not disputed that the cheque in question
was presented within its validity period.

(b) The cheque in question was returned unpaid vide re-

turn memo Ex.CW1/2 due to the reason, "ACCOUNT
CLOSED".

(c) The complainant has proved on record legal notice,

registered post receipt and tracking report and same
was also been replied by the accused, which are
Ex.CW1/3, Ex.CW1/4, Ex.CW1/5 and Ex.CW1/6, re-
spectively. The fact that the payment was not made
within 15 days of the receipt of the legal notice is also
not disputed.

As far as the proof of second ingredient is concerned,

the complainant has to prove that the cheque in question
was drawn by the drawer for discharging a legally enforce-
able debt. In the present case, the issuance of the cheque
in question is not denied. As per the scheme of the NI Act,
once the accused admits signature on the cheque in ques-
tion, certain presumptions are drawn, which result in
shifting of onus. Section 118 (a) of the NI Act lays down the
presumption that every negotiable instrument was made or
drawn for consideration. Another presumption is enumer-
ated in Section 139 of NI Act. The provision lays down the
presumption that the holder of the cheque received it for
the discharge, in whole or part, of any debt or other liabil-
ity. The combined effect of these two provisions is a pre-
sumption that the cheque was drawn for consideration and
given by the accused for the discharge of debt or other lia-
bility. Both the sections use the expression "shall", which
makes it imperative for the court to raise the presump-
tions, once the foundational facts required for the same are
proved. Reliance is placed upon the judgment of the
Hon'ble Supreme Court, Hiten P. Dalal vs. Bratindranath
Banerjee [(2001) 6 SCC 16]. Further, it has been held by a
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three-judge bench of the Hon'ble Apex Court in the case

of Rangappa vs. Sri Mohan [(2010) 11 SCC 441] that the
presumption contemplated under Section 139 of NI Act in-
cludes the presumption of existence of a legally enforceable
debt. Once the presumption is raised, it is for the accused
to rebut the same by establishing a probable defence. The
principles pertaining to the presumptions and the onus of
proof were recently summarized by the Hon'ble Apex Court
in Basalingappa vs. Mudibasappa [(2019) 5 SCC 418] as
under:

"25. We having noticed the ratio laid down by this Court in

the above cases on Section 118 (a) and 139, we now sum-
marise the principles enumerated by this Court in the follow-
ing manner:

1. Once the execution of cheque is admitted Section 139 of the

Act mandates a presumption that the cheque was for the dis-
charge of any debt or other liability.

2. The presumption under Section 139 is a rebuttable presump-

tion and the onus is on the accused to raise probable defence. The
standard of proof for rebutting the presumption is that of prepon-
derance of probabilities.

3. To rebut the presumption, it is open for the accused to rely on

evidence led by him or the accused can also rely on the materials
submitted by the complainant in order to raise a probable defence.
Inference of preponderance of probabilities can be drawn not only
from the materials brought on record by the parties but also by
reference to the circumstances upon which they rely.

4. That it is not necessary for the accused to come in the witness

box in support of his defence. Section 139 imposed an eviden-
tiary burden and not a persuasive burden.

11. Whether in the present facts and scenario, the accused

has been able to raise a probable defence in his favour
and has been able to rebut the said presumption?

11.1 At the stage of framing of notice under Section 251 Cr.P.C.,

the accused stated that he had taken a loan of Rs.
1,90,000/- from the complainant in the year 2020 and the
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cheque in question was given to him and he also stated

that he had repaid the said amount to him in the year
2020 by way of banking channel but he did not have any
receipt of repayment. If the defence of the accused is to be
believed that he had repaid the loan amount to the said
person namely Japjeet, then why did he not ask him to re-
turn his cheque. The accused did not take any action
against the said person namely Harsimran and Japjeet to
get back his cheque. So, this defence of the accused does
not seem to inspire confidence.

As the accused has himself taken contradictory stands at

different stages of the case as he has taken different de-
fence from the application U/s.145(2) Cr.P.C. which was
only specifically allowed and accused took different defence
at the time of cross-examination of complainant and his
cross-examination Merely, suggesting to the complainant
that the cheque was given as a security is not sufficient to
rebut statutory presumptions which is in favour of the
complainant.

The accused entered the witness box as DW1, he stated

that he had handed over a blank signed cheque to Japjeet to-
wards the security of borrowed loan. So, now at this stage, he
stated that he handed over the cheque in question to Japjeet.
This is contrary to what he stated at the earlier stages as during
stage of framing of notice under Section 251 Cr.P.C, and at the
stage of recording of his statement under Section 313 Cr.P.C.,
Pertinently, the accused has given inconsistent statements dur-
ing different stages of trial. This makes the defence of the ac-
cused unreliable.

It is submitted at no stage of proceedings, the accused de-

nied taking a loan. Further he never confronted the complainant
with regard to lending of a sum of Rs.7,50,000/-. The statement
made by the complainant in his chief-examination, more particu-
larly in para 4 of chief-examination CW-1/A “4. Deponent further
states that the accused person sought financial help/friendly loan
from the complainant for an amount of Rs. 7,50,000/- and the
same was given to the accused person by the complainant.”

This testimony of the complainant has gone unrebutted

and further the complainant was never confronted with the al-
leged repayment entries as per his alleged banking statement
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which was not as per Bankers Books Evidence Act and 65B of
Evidence Act.

It is a settled law that once presumption under Section

118 NI Act and Section 139 NI Act are raised against the ac-
cused, the onus shifts to the accused and unless the accused
has discharged the onus by bringing on record such facts and
circumstances as to show the preponderance of probabilities tilt-
ing in his favour, any doubt on the complainant's case cannot be
raised for want of evidence regarding the source of funds for ad-
vancing loan to the accused. A probable defence needs to be
raised by the accused , which must meet the standard of "pre-
ponderance of probability", and not mere possibility.

In the present case, the accused has taken the defence that
he took only Rs.1,90,000/- and gave a security cheque. However,
he has not evidenced his defence by any cogent proof. Resul-
tantly, the defence raised by the accused does not inspire confi-
dence or meet the standard of 'preponderance of probability'. In
the absence of any other relevant material, the defence of the ac-
cused has to be discarded.

Conclusion

From the above discussion, that all the ingredients of offence

punishable u/s 138 NI Act have been fulfilled with respect to ac-
cused and he has been unable to rebut statutory presumptions
arising against him. Accused Naveen Rana should be convicted
for offence punishable under Section 138 NI Act and maximum
compensation out of the fine should be imposed on the accused
person U/s.357(3) of Cr.P.C. alongwith the cost as incurred by
the complainant should also be imposed.

Submitted by

New Delhi
Dated : 24/04/2023

Rohit Krishan Naagpal & Dipanshu Gaba

Counsels for complainant