Madhavi Investment and Trading Pvt. Ltd. vs Mr. Damodar Vassant Parulekar

N.A. Britto, J.—This is complainant''s appeal and is directed against the acquittal of the accused u/s 138 of the Negotiable Instruments Act, 1881, by Judgment dated 3-11-2008 of the learned J.M.F.C.(Magistrate, for short), Panaji.

The subject matter of the complaint were four cheques, the details of which are as follows:

The said cheques were drawn on Mapusa Urban Co-operative Bank Ltd., Panaji, and because of instructions issued by the accused on or about 15-12-1995 to his bankers, the same were dishonoured, and after that a demand notice was sent, on behalf of the complainant, which was replied to on behalf of the accused, and in the said reply a specific defence was taken that the amount due on the said cheques was paid on 30-10-1995.

In support of the said plea, the accused produced a receipt dated 30-10-1995 which according to the accused was signed by Laxman Bandekar, the Managing Director of the complainant-company who died on 26-3-1997. The complaint was filed through attorney, one Mr. Uday Mahatme. Mr. Kamlakant Zhende deposed on behalf of the complainant. The said Zhende was only an Office Assistant of the complainant and was doing clerical work in their office at Panaji. Subsequently, the complainant filed a Civil Suit against the accused for the recovery of the said sum of Rs. 3,38,410/- to which the accused filed a written statement on 17-8-1999. It appears that the original receipt which according to the accused was signed by the complainant''s Managing Director dated 13-10-1995 was shown to the complainant''s said witness on 24-1-2001, though this fact is contested on behalf of the complainant, and thereafter the original records of the learned trial Court were lost and the file was re-constituted. As the deposition of the complainant''s witness recorded on 24-1-2001 shows, the receipt dated 30-10-1995 signed by Laxman Bandekar as Managing Director was shown to the complainant''s witness and it could be safely inferred, that is the original of the receipt which was shown to the complainant''s witness on that day since otherwise the Court would have recorded that a copy of the receipt was shown; and, thereafter only a copy of it was produced on behalf of the accused after the file was re-constituted, as observed by the learned trial Court in para 12 of the Judgment.

Before this Court, by consent of the learned Counsel appearing on behalf of parties the entire deposition of the complainant''s witness recorded on various dates was reconstituted and was taken on record and the same is at pages 35 to 69 of the paper book.

Some more facts are required to be stated to dispose of this appeal.

The case of the complainant is that the complainant had entered into an agreement with the accused and his wife on 2-5-1995 for purchase of a flat on the 3rd floor of Madhuban Shopping and Residential Complex for a sum of Rs. 6,27,000/- out of which the accused had paid a sum of Rs. 3,00,000/- on 26-5-1995, and, the complainant had allowed the accused to take temporary possession of the said flat around October, 1995 as per the request of the accused for the purpose of interior decoration despite the accused having not paid Rs. 3,38,410/-, and towards the said payment the accused had given the said cheques which were accepted by the complainant on a specific understanding with the accused that the cheques would be honoured on presentation.

Further, the case of the complainant was that the complainant was surprised when the said cheques were returned unpaid on 30-1-1996. According to the complainant, the said cheques were issued in discharge of the liability of the accused to the complainant. The case of the complainant was that the complainant sent a notice dated 2-2-1996 through his advocate and the accused sent a reply dated 16-2-1996 raising baseless allegations against the complainant, by introducing a new element of having paid the amount in cash as an afterthought to avoid penal consequences, and the complainant also sent a letter of rejoinder dated 23-2-1996. Accordingly, the complaint was filed.

On behalf of the complainant, one Kamlakant Zhende was examined. The said Zhende was working at Panaji Office of the complainant as an Office Assistant. The accused gave his own evidence and produced some of the documents.

The learned trial Court after considering the evidence led on behalf of both the parties came to the conclusion that the evidence produced by the accused in respect of his case had remained unshaken and unrebutted. The learned trial Court further held that in case the sum of Rs. 3,38,410/- was not paid to the complainant, the accused would not have been appointed as Chief Promoter of the Society by the complainant though the accused had purchased another flat in the same building in respect of which the entire consideration was admittedly paid. The learned trial Court also observed that the evidence of the complainant''s witness Mr. Zhende showed that the electricity meters in respect of both the flats of the accused were in the name of the accused and both the flats were registered in the name of the accused in the municipal records and the aforesaid circumstances pointed out that the accused had paid the entire consideration for the flat in question to the complainant. The learned trial Court further held that the accused having discharged his burden of rebutting the presumptions, the burden shifted on to the complainant to prove that the cheques were issued in the circumstances averred in the complaint. The learned trial Court therefore proceeded to acquit the accused u/s 138 of the Act. It appears that on behalf of the complainant charge u/s 420 IPC was not pressed.

Be that as it may, as rightly pointed out by Shri S.D. Lotlikar, the learned Senior Counsel on behalf of the complainant, the accused was required to prove by preponderance of probability that the accused had effected payment of the amount covered by the cheques but, in the submission of learned Senior Counsel the accused has failed to prove the same and rebut the said presumption. Shri Lotlikar, learned Senior Counsel, submitted that the receipt dated 30-10-1995 was not proved by the accused, and that the accused had given varying versions as to where the money was handed over to Shri Laxman Bandekar, the accused having stated at one place that it was paid in his Office at Vasco-da-Gama, and at another place the said Bandekar having come to Panaji and having taken the said money. The learned Senior Counsel further submitted that the accused also took conflicting pleas namely that the subject cheques were given as security. Learned Senior Counsel further submits that in case any security was to be given there was no explanation why four cheques were required to be given by the accused. Learned Senior Counsel further submits that in case the payment was made by the accused on 30-10-1995 the accused would not have waited until 7-11-1995 to ask for the return of the cheques by letter dated 7-11-1995 which letter was otherwise not at all received by the complainant. Learned Senior Counsel submits that the receipt dated 30-10-1995 produced by the accused could not be looked into and so also the letters dated 7-11-1995, 25-11-1995 and 15-12-1995. It is also submitted that the said receipt as well as the said letters were not exhibited because they were not proved. It is also submitted that the original receipt dated 30-10-1995 was not produced before the Court before the same went missing, and as such it is not known whether the original receipt was at all shown to the said Mr. Zhende when it was marked as PW1/X for identification. Learned Counsel further submits that the said receipt has been relied upon by the learned Magistrate when it could not have been relied upon because it was not admitted in evidence and so also the two letters dated 7-11-1995 and 25-11-1995 which were not proved, and whose receipt by the complainant was not established. It is the submission of Shri Lotlikar that the accused did not examine the person who allegedly received the said two letters, and the receipt and the said letters having not been proved, the same could not be looked into by the learned trial Court, and since the Judgment is founded on the said two documents the Judgment of acquittal is unsustainable in law, and, if the documents produced in support of his case were not proved, in the manner laid under the Indian Evidence Act they could not be read as part of evidence. It is also submitted that the learned trial Court fell into error to look into the evidence which was inadmissible. The receipt was not proved, and, therefore the same could not be looked into, nor did the accused seek leave of the Court to lead secondary evidence, by making an appropriate application before the Court, by satisfying the Court that the original receipt was lost and that there was copy made from the original, by mechanical process which itself ensured the accuracy of the copy which was available with him. It is also submitted that the claim of the accused that he paid a huge amount of Rs. 3,38,410/- by cash when in terms of relevant provisions of law it was required to be paid by cheque could not be believed since such payments in cash are prohibited in law. It is also his submission that the learned trial Court glossed over the glaring loopholes in the evidence of the accused by saying that they were minor contradictions which are in fact glaring. Learned Counsel further submitted that only because there is no denial to the two letters dated 5-11-1995 and 25-11-1995 in cross-examination of the accused, that did not mean that the said letters are proved or their receipt by the complainant is admitted by the complainant''s witness who had otherwise categorically stated that the said letters were not received by the complainant. It is submitted that the case put forward by the accused was inherently improbable because the accused allowed the cheque to remain in possession of the complainant when according to him he had made the payment on 30-10-1995 and a reasonable person would not have waited till 7-11-1995 to send a letter demanding the return of the cheques. It is submitted that the contention of the accused that the complainant did not examine any witness who was not conversant to the facts of the case is fallacious and all that the complainant was required to examine was a person who could prove the offence against the accused and the complainant had practically nothing to prove and only because the person did not find the person examined convenient to prove his defence it cannot be said that the prosecution had not examined appropriate witnesses.

On the other hand, Shri S. Samant, learned Counsel on behalf of the accused has submitted that the complainant''s witness Shri Zhende was a person who had no knowledge of the transaction between the complainant''s Managing Director, the said Laxman Bandekar and the accused. Learned Counsel further submits that the accused has given his evidence, and in fact there has been no evidence given on behalf of the complainant, to the contrary. Learned Counsel further submits that what was stated by the accused in paras 12, 13 and 14 of his affidavit was not even denied on behalf of the complainant. He further submits that the complainant''s witness the said Zhende when he was shown the original receipt on 24-1-2001 chose not to identify the signature on the same when he could have done that exercise because as on that date there were seven admitted signatures of the said Laxman Bandekar, and six seals of the Company from which he could compare and verify the signature of the said Bandekar and the seal of the Company but took time, and only six months later i.e. on 18-7-2001 said that the said signature on the said receipt dated 30-10-1995 was false. Learned Counsel has further submitted that in case the payment was not made by the accused, the complainant would not have transferred the flat in dispute to the accused, because the terms of the agreement between the complainant and the accused stipulated that the possession would be given to the accused only after the payment was made and the fact that the flat was handed over in possession of the accused and thereafter the accused was given a N.O.C. to be the Chief Promoter of the Society abundantly proves that the possession was given by the complainant to the accused only after the said sum was paid by the accused. He further submits that a N.O.C. was also issued by the complainant to enable the accused to transfer the subject flat in the name of the accused which was accordingly done. Learned Counsel further submits that similarly with the N.O.C. obtained from the complainant water and electricity connections were obtained by the accused.

Shri Samant has further pointed out to an admission from Shri Zhende who stated that the parties to the agreement had performed their respective part of the contract, and if that be the case, Shri Samant submits, that there was no payment which was required to be made by the accused.

I have already concluded that the original receipt dated 30-10-1995 was shown to the complainant''s witness Shri Zhende on 24-1-2001 before the file was reconstituted. If according to the complainant four cheques were not required to be given in case the cheques were given as security, by the same standard, the complainant has not explained why the accused had to give four cheques for a payment of Rs. 3,38,410/-. Be that as it may, admittedly, whether it is the agreement dated 2-5-1995 for the purchase of the flat or for that matter the payment of money by the accused was a matter between the complainant''s Managing Director, the said Laxman Bandekar and the accused. The said Laxman Bandekar expired on 26-3-1997 but was living when the accused replied to the complainant''s notice dated 16-3-1996 wherein on behalf of the accused it was stated that the accused had paid the entire amount of Rs. 3,38,410/- to the complainant. The complainant''s Managing Director, the said Laxman Bandekar does not appear to have re-acted in any manner to the said reply given to the accused on 16-3-1996. The accused has lived to tell his side of the story but the complainant''s Managing Director died on 26-3-1997, and it appears that his side of the story died with him. The only persons who could have known Mr. Bandekar''s side of story was his widow Mrs. Jyoti Bandekar who was the Director and subsequently became the Managing Director of the complainant-company and Shri Mahatme who was his Personal Assistant and who in fact had filed the complaint on behalf of the company but subsequently did not step in the witness box. Shri Raju Navelkar was the other person who would have knowledge about the transaction but the complainant chose not to examine any one of them although their names did figure in the complaint. In other words, the complainant withheld the best available evidence being produced which leads to an inference that if produced it would be unfavourable. These facts have been admitted by Shri Zhende when he stated that Mahatme and Raju had personal knowledge about the transaction of the two flats which are the subject matter of the case.

The accused in his evidence had stated that the complainant in terms of the agreement was to give the possession of the flat after obtaining the Occupancy Certificate by 30-6-1995, and as the complainant failed to do so he postponed the payment of the installment due in June, 1995. He stated that thereafter the Occupancy Certificate of the suit flat was issued on 24-11-1995 and thereafter the possession of the said flat came to be given to him on 27-11-1995. According to the complainant, the suit flat was given to the accused in October. PW1/Zhende has admitted that the Occupancy Certificate was given on 24-11-1995 but as far as possession is concerned he has stated that he could not say as to the date on which the possession was handed over to the accused. That much was for the knowledge of the complainant''s witness as regards the suit transaction. Therefore, there was no other option but to accept that the accused was given possession of the suit flat(H 12) on 27-11-1995 and not around October, 1995 as stated in the complaint.

The accused further stated that the said Laxman Bandekar represented to him that the building was near completion and the Occupancy Certificate was due at any moment and as such directed him to deposit the cheques with him as security, and he signed the four cheques and gave them to him on 2-10-1995 and except for the signature on the said four cheques, the said cheques were blank. On this aspect, Shri Zhende stated that he did not know when the cheques were handed over to Laxman Bandekar. He further stated that he did not have personal knowledge as to whether the said cheques were complete in all respects on the date when they came in possession of Laxman Bandekar.

The accused further stated that he had cordial relations with the said Bandekar and his family and that on 30-10-1995 he made full and final payment in cash of the balance consideration of the flat of Rs. 3,38,410/- to Shri Bandekar in person against receipt issued by him under his signature with the seal of the Company and that the said receipt was issued in lieu of the said four cheques. The accused further stated that the above original receipt was produced by him on 18-7-2001 which was marked as PW1/X. He identified the signature appearing thereon as that of late Laxman Bandekar who had signed the same in his presence, and he also identified the seal thereon as that of the complainant. Admittedly, the deposition of complainant''s witness Zhende recorded on 24-1-2001 shows that he was shown a receipt dated 30-10-1995 and as I have already stated, it is more than probable that what Zhende was shown on that day was the receipt in original and in case a copy was shown to Zhende it would have been specifically recorded that a copy was shown to him. It is an admitted position that after the original record was lost in 2003 the Court file was re-constituted and presumably on 27-8-2008 when the accused identified the signature and the stamp of the Company, it was on a copy available with the accused. On behalf of the complainant, no objection was taken to the accused producing the copy and identifying the signature of Mr. Bandekar and the seal of the Company and that was obviously because the parties and their Counsel knew that the original of the receipt was lost along with the file of the trial Court. It is, therefore, too late in the day to contend that the accused ought to have filed a formal application to produce a copy of the receipt. When the accused produced the copy of the same receipt on 27-8-2008 and identified the signature of Mr. Bandekar that copy ought to have been exhibited as it was prima facie proved by the accused by identifying the signature of the complainant''s Managing Director and the stamp of the Company. As already stated, when the receipt in original was shown to Shri Zhende on 24-1-2001 he stated that he wanted to verify the signature on the records available. Probably, Shri Zhende did not know the signature of the said Bandekar and for that reason he could not identify the same on 24-1-2001 without verifying it on other records, though he could have verified the same on the basis of other admitted documents available on record. But, when the said Zhende came to depose six months later on or about 18-7-2001 he stated that the signature of Bandekar on the said receipt was false and the seal could be made by anyone. He was shown the admitted signature of Bandekar on another receipt in respect of the other flat(H 11) which was produced as Exh.30 and he identified the said signature but when he was asked as to what was the difference between the signature of Mr. Bandekar on Exh.30 and the said receipt which was earlier marked as PW1/X all that he stated was that he could not say what was the dissimilarity between the said signatures, and further stated that he had no knowledge about the identification of the handwriting. On the basis of the evidence of the accused, in the absence of any reliable evidence on behalf of the complainant, the said receipt dated 30-10-1995, a copy of which was subsequently produced by the accused had to be considered as proved.

The accused had also stated that as the complainant had not returned the four cheques despite of receiving the entire consideration he sent two letters on 7-11-1995 and 25-11-1995 requesting them to return the said four cheques and that he delivered the said letters under his signature in the Panaji Office of the complainant and the same were duly acknowledged by the employee of the Company Shri Sunder Singh Gasti. He identified his signature as well as that of the said Sunder Gasti on the said letters dated 7-11-1995 and 25-11-1995-Exh.13. He further stated that as he apprehended foul play at the end of complainant in respect of the said four cheques, he issued instructions to his bankers to stop the payment of all the four cheques vide his letter dated 15-1-1995 which was produced as Exh.42. The accused with his own evidence had prima facie proved copies of the letters dated 7-11-1995, 25-11-1995 and 15-11-1995, and as far as the said letters are concerned there was no re-action at all on behalf of the Company. The originals of the said letters would have been with the complainant. Complainant''s witness Zhende admitted that the said Sunder Singh Gasti was working at their Panaji Office for more than two years till March, 1999. Initially, Zhende stated that the said letter dated 7-11-1995 was not received by the complainant and further stated that he could not identify the signature on the said letter. He stated stated that he would be able to identify the signature of the said Sunder Singh Gasti on the said letters as per office records and from the muster roll where the said Sunder Singh Gasti was signing. This was on 18-7-2001, but later on 10-10-2001 he stated that he had the muster roll and that he would bring it to Court on the next date and further stated that he had to further confirm from the records whether the said Sunder Singh Gasti had signed any other documents of the Company including payment receipts or letter of appointments, etc. but when the next date came on 5-12-2001 he stated that he could not trace the muster roll of the year 1995 and he could not trace the file also, and as such could not say whether the said Sunder Singh Gasti had signed any documents. On one side, we had positive assertion by the accused that the said three letters were delivered by him to the Company''s Office at Panaji and were acknowledged by Sunder Singh Gasti who was admittedly an employee of the Company and on the other side we had the complainant''s witness who was unable to identify his signature inspite of the fact that he knew his signature and was in a position to identify the same and yet was unable to say whether the said signature was that of Sunder Singh Gasti. He also did not deny his signature. It follows from the evidence produced, that the accused had not only proved the receipt of payment of Rs. 3,38,410/- but had also proved that because the complainant had not returned the cheques he had sent two letters and then given instructions to the Bank not to honour the said cheques.

This was a case which the accused had certainly proved by preponderance of probability that he had made the said payment and had even asked for the return of the said cheques. The fact that possession of the flat was given to the accused when the agreement provided that it would not be given until payment was made was another indication that the flat was given to the accused because payment was made by him to the complainant, as already stated. The complainant has withheld the best evidence which would have been produced, namely the evidence of the persons who would have been in the know of the affairs of the Company, namely the said Smt. Jyoti Bandekar who was the widow of Laxman Bendekar and then a Director during his tenure as Managing Director, and subsequently became its Managing Director and the said Mahatme who was the Personal Assistant of the said Laxman and Raju who had also personal knowledge about the transaction of the two flats, according to the complainant''s witness. Moreover, Shri Zhende had also stated that he had received the cheques from the Accounts Department. In case the payment was made by the accused the persons from the Accounts Department of the Company would have certainly known about the same and there were three to four persons employed and none of the persons were examined on behalf of the complainant. In fact, Zhende had conceded that he had no personal knowledge whether the accused had effected payment of Rs. 3,38,410/- to Laxman Bandekar on 30-10-1995. As already stated, it is a well settled proposition of law that when a party withholds best available evidence it leads to an inference that if produced, it would be favourable to the party. See Kundan Lal Rallaram Vs. Custodian, Evacuee Property, Bombay, .

For the reasons stated herein above also, the acquittal of the accused cannot be faulted. The appeal therefore is hereby dismissed.