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M/s. Apollo Tyres Ltd Versus M/s. Indira Tyres & Ors

2016 (9) TMI 866 - DELHI HIGH COURT

Dishonor of cheques - complaints under Section 138 of the Negotiable Instruments Act - Held that:- Admission made by the accused, there was no question of there being merely a presumption in favour of the complainant about the existence of debt or other liability in respect whereof the said 61 cheques had been issued. There was no question of the said presumption being discharged by the accused. There was absolutely no basis to conclude that the said 61 cheques had been given towards security. T .....

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here was no question of there being any doubt arising in the mind of the court with regard to the outstanding debt and liability of the accused qua the 61 cheques in question. - For all the aforesaid reasons the impugned judgment borders on perversity and they are, accordingly, set aside. The complainant had been able to establish that the cheques in question had been issued against specific debts incurred by the accused against supplies of tyres, tubes and flaps, and that the said cheques w .....

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241/2015, CRL.L.P. 242/2015, CRL.L.P. 243/2015, CRL.L.P. 244 to 251/2015 - Dated:- 31-8-2016 - MR. VIPIN SANGHI J. Petitioner Through: Mr. Avinash Kumar Lakhanpal, Adv. Respondents Through: Mr. Shahid Azad, Adv. VIPIN SANGHI, J. (OPEN COURT) Leave granted. Crl. A. Nos. .............................../2016 (to be registered and numbered) 1. Let the appeals be registered and numbered. 2. With consent, I have heard learned counsels for the parties on the appeals today itself, and I proceed to disp .....

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. 929513 02.12.99 17332.00 6. 929515 02.12.99 18498.00 7. 567393 16.11.99 19697.00 8. 567375 20.10.99 19697.00 9. 567390 12.11.99 19697.00 10. 567389 11.11.99 19697.00 11. 929531 20.01.99 19697.00 12. 929530 24.01.00 19323.00 13. 929543 20.01.00 12762.00 14. 929532 20.01.00 18498.00 15. 929539 20.01.00 09249.00 16. 929525 17.02.00 19697.00 17. 929520 02.12.99 20702.00 18. 929519 02.12.99 19697.00 19. 929518 02.12.99 20185.00 20. 929512 02.12.99 18498.00 21. 929534 20.01.00 20185.00 22. 929506 26 .....

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53426.00 40. 567388 11.11.99 19697.00 41. 929547 24.01.00 49545.00 42. 567397 20.01.00 28336.00 43. 929553 24.01.00 45403.00 44. 929550 07.02.00 49545.00 45. 929551 24.01.00 49545.00 46. 929545 24.01.00 19818.00 47. 929546 24.01.00 19818.00 48. 567378 23.10.99 28336.00 49. 929517 02.12.99 20185.00 50. 929516 02.12.99 20702.00 51. 567387 07.11.99 19697.00 52. 929552 24.01.00 49549.00 53. 929554 24.01.00 09161.00 54. 929555 24.01.00 03553.00 55. 929502 24.11.99 01782.00 56. 929556 10.02.00 28457.0 .....

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ture and sale of automotive tyres, tubes and flaps. Accused no.1, which is a partnership concern of the other accused, was appointed a dealer of the complainant. In the course of its business from time to time, the accused purchased the products manufactured by the plaintiff/ appellant against invoices. The accused made payment of the invoices by issuing cheques. The details of the various invoices, in respect of which the aforesaid cheques were issued along with the dates and amounts, as set ou .....

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of the invoices in question are given as under … … … . The particulars of the invoices in question (as set out hereinabove) were set out in the said notice. 7. In para 33 of the notice, the appellant averred: 3. That in discharge of your liability against the goods purchased vide invoices detailed herein above you issued following sixty one cheques all drawn on State Bank of India, G.T. Road, Delhi in favour of the company . The appellant then set out the particulars of 61 .....

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ents, as mentioned subsequently . (emphasis supplied) 9. The accused claimed that the accused had created a security deposit to the tune of ₹ 12.58 lacs with the appellant. The accused sought to give particulars of the manner in which the said security deposit had been created from time to time. It was, inter alia, stated by the accused as follows: In view of total ₹ 12,58,000/- remaining as security with you till now the existence of any sole or exclusive liability to pay ₹ 13 .....

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ipt of complete statement of account for the last 3 years from you. The said accounts will establish that in fact my clients have to receive substantial funds from you. You are humbly advised to refrain from filing any complaint u/s 138 NI Act, against my clients and further requested to settle the claims and counter claims in a business like manner across the table . (emphasis supplied) 11. Since the amounts were not paid as claimed by the appellant, the aforesaid complaints came to be filed an .....

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0.11.99 18403.00 3 903770/929513 02.12.99 17332.00 4 904446/929513 24.01.00 12762.00 5 904416/929539 20.01.00 09249.00 6 904402/929535 20.01.00 01782.00 7 903629/929501 24.11.99 16735.00 8 903763/929510 30.11.99 01782.00 9 903360/567381 01.11.99 20185.00 10 903632/929502 24.01.00 01782.00 11 904421/929540 24.01.00 13992.00 12 904436/929541 24.01.00 06930.00 The appellant also stated that the accused persons have already been informed about this appropriation vide communication dated 20.06.2000. .....

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ts. He stated that the security amount of ₹ 1.35 lacs lying with the appellant had been adjusted against 12 cheques, the details whereof had been given in para 8 of the complaint, and that no complaint in respect of the said 12 cheques had been filed by the complainant. 15. CW-1, Sanjay Jain was cross examined on behalf of the accused. He was asked about the board resolution whereby he had been authorised by the appellant company to file complaints on behalf of the complainant. In this reg .....

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It is correct that power of attorney Ex. CW-1 is in my favour does not have any reference to the resolution in my favour. It is wrong to suggest that no resolution was passed in my favour and therefore it is not mentioned in power of attorney. It is wrong to suggest that I am incompetent to depose in this case . 16. The accused led evidence of Sh. Paramjeet Singh (accused no.4) as DW-1. In his cross examination, DW-1 stated that he did not have any document which could suggest or establish that .....

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before the competent authority in respect of misuse of the 61 cheques by filing 17 different cases. He also admitted not to have any documentary proof/ receipt issued by the complainant company with regard to the creation of security deposits of ₹ 10,000/-, ₹ 3,000/-, ₹ 5.10 lacs and ₹ 25,000/-. He admitted that he had no document to show that the accused had deposited a sum of ₹ 12.48 lacs as security deposit with the complainant company. 17. The Trial Court, while .....

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t of which 61 cheques were claimed to have been issued, to substantiate the version of the complainant. The learned Magistrate also referred to the cross examination of CW-1 Sanjay Jain, wherein he admitted not to have placed on record any statement of account. He also did not show from the statement of account that the security amount lying with the appellant had been adjusted and the accused given credit for the same. 18. The submission of counsel for the appellant is that the impugned judgmen .....

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in fact, did not dispute the factum of receiving the goods under the invoices as mentioned in the notice, and the factum of issuance of the cheques in question towards payment of the said invoices. The defence of the accused was that the accused had created a security deposit to the tune of ₹ 12.58 lacs and the accused in its reply dated 12.05.2000 called upon the appellant to adjust the said security and also to settle the other claims of the respondent/ accused. Thus, the accused admitt .....

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ead in evidence the specific invoices against which supply of goods had been effected, or to establish that the cheques in question had been issued in respect of the said invoices. These aspects had been admitted by the respondent/ accused. 20. Learned counsel further submits that the plea of the accused that the accused had created a security deposit of ₹ 12.58 lacs was denied by the complainant in the complaint itself, and the complainant had acknowledged adjustment of the security depos .....

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om the cross examination of DW-1 itself. The debt in question arose in respect of the specific supplies made through the invoices aforesaid, in respect whereof each of the aforesaid cheques had been issued for odd amounts. The accused has also not been able to establish that the said 61 cheques had been issued as security cheques and the finding of the Trial Court in this regard is not supported by any evidence whatsoever. 22. On the other hand, the submission of counsel for the accused/ respond .....

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ainant under Section 138 of the Act i.e. Ex. CW-1/5, it is evident that the complainant/ appellant specifically claimed that the appellant effected supplies of the products manufactured by it, namely, tyres, tubes and flaps to the accused during the course of business against invoices, details whereof are also set out in the said notice itself. The appellant had also set out in the statutory notice Ex. CW-1/5, the particulars of the 61 cheques issued by the accused in settlement of the said invo .....

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and liability, the said cheques were issued. 24. The lacuna found by the Trial Court in the case of the complainant/ appellant that the appellant had failed to lead in evidence the invoices/ bills, and had also not produced the statement of account was, therefore, completely misplaced. There was no need or occasion for the appellant to prove the facts which had already been admitted by the accused in their reply to the statutory notice. Pertinently, the accused did not disown their averments in .....

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ainant and the response of the accused to the said notice that the said 61 cheques in question had been issued by the accused in settlement of its dues owed to the appellant on account of supply of goods, namely, tyres, tubes and flaps. In its reply to the legal notice under Section 138 of NI Act, the accused admitted the receipt of the goods as detailed in para 2 of the said notice and also admitted the issuance of cheques in favour of the complainant/ appellant. Pertinently, these cheques are .....

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the appellant. The accused also sought to adjustment/ settlement of its claims and demanded the appellant/ complainant to make payment of the amount that may be found due to the accused. 28. Pertinently, the amount claimed by the accused was neither quantified nor was it claimed by the accused that the same had been acknowledged to any extent by the complainant/ appellant. Though the accused claimed to have created security deposit to the tune of ₹ 12.58 lacs, during cross examination of .....

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h the complainant. 29. The approach of the Trial Court in finding fault with the complainant in not leading in evidence the invoices or the account statement is completely misdirected in the facts of this case taken note of herein above. There was no need or occasion for the complainant to lead any such evidence, in view of the admissions made by the accused in their reply to the legal notice under Section 138 of the NI Act. The Trial Court has sought to place heavy reliance on the letter dated .....

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o reconcile our accounts . The accused asked the complainant not to present the cheques issued in favour of the complainant in advance in routine and to return the unused cheques. The accused also demanded that after reconciliation, whatever amount is due to the accused may be paid at the earliest. Pertinently, in this communication, the accused did not claim that the security deposit lying with the complainant was to the tune of ₹ 12.58 lacs. The accused also did not particularise or quan .....

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eceived by the accused. The mere raising of claims by the accused which were neither quantified nor acknowledged by the complainant could not have justified the conduct of the accused leading to dishonour of the 61 cheques in question. 31. Pertinently, while accepting supplies of the goods against the 61 invoices, the accused did not seek adjustment of the so-called security deposit or its claims under the other heads aforesaid. The accused proceeded to issue the cheques in question thereby clea .....

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