TaxTMI 
TaxTMI 
2016 (9) TMI 866
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....are as follows: S. No. Cheque No. Cheque Date Amount 1. 567392 14.11.99 19697.00 2. 929514 02.12.99 14168.00 3. 929511 30.11.99 28336.00 4. 929509 30.11.99 18403.00 5. 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 26.11.99 19697.00 23. 567376 20.10.99 19697.00 24. 567391 12.11.99 19697.00 25. 567395 19.11.99 20185.00 26. 929549 24.01.00 45403.00 27. 929535 20.01.00 01782.00 28. 567394 16.11.99 40370....
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.... a statutory notice of demand dated 02.05.2000 to the respondent/ accused. In para 2 of this notice, the appellant claimed that "you have been purchasing our products viz. tyres, tubes and flaps for the purposes of resale from our branch office situated in East Delhi. The sold goods have been handed over to you along with respective invoices. Details 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 cheques issued by the accused, as set out herein above. 8. The accused sent a reply to the said legal notice on 12.05.2000. The accused, in response to para 2 of the said notice stated as follows: "2. That the receipt of goods by this firm M/s Indra Tyres, from you, as detailed in para 2 of your notice is not denied. Similarly, the issue of c....
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....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. 12. The accused, upon being summoned denied any liability and claimed that accused was not guilty. The accused claimed trial. 13. The appellant then led evidence of CW-1 Sh. Sanjay Jain, Manager (Legal) and constituted attorney of the appellant company. Along with his affidavit by way of evidence towards examination in chief, he produced Ex. CW-1/2 - a copy of the power of attorney in his favour. 14. CW-1, inter alia, stated that the accused had asked for adjustment of the various security amounts. He stated that the security amount of Rs. 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 compla....
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....he onus placed upon them that the 61 cheques were not issued against any debt or legally enforceable liability, because the accused had sent the letter dated 14.03.2000 (Ex. DW-1/A), and proved that all 61 cheques were given towards security. On the other hand, the complainant did not furnish any bill or invoice in respect 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 judgment suffers from perversity. Learned counsel submits that the Trial Court has completely ignored and misread the evidence brought on record by the appellant. The Trial Court has not even properly read and understood the averments made by the complainant/ appellant in the statutory notice dated 02.05.2000 and, in particular, in para 2 and 3 thereof, and the response of the r....
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....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/ respondent is that the accused has preferred a counter claim which is pending before a civil Court on the basis of the statement of account furnished by the complainant in the civil suit preferred by it. Learned counsel also submits that the accused had demanded the appellant to furnish the statement of account which was never furnished. In this regard, reference is made to the letter dated 14.03.2000 (Ex. DW-1/A). 23. On a perusal of the relevant extracts from the notice issued by the appellant/ complainant 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 settle....
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....cused was that the accused had created a security deposit of Rs. 12.58 lacs, which may be adjusted against the outstanding dues of 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 Rs. 12.58 lacs, during cross examination of DW-1 Sh. Paramjeet Singh, he admitted that, firstly, there was no document to suggest or establish that the said 61 cheques were given in advance and, secondly, that the accused had no documentary proof/ receipt with regard to creation of security deposits as claimed by the accused of Rs. 10,000/- Rs. 3,000/-, Rs. 5.10 lacs or Rs. 25,000/-. The accused also admitted not to have any document to show that the accused had deposited a sum of Rs. 12.48 lacs as security deposit with the complainant. 29. The approach of the Trial Court in finding fault with the complai....
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....estion thereby clearly agreeing to make payment in respect of the said 61 invoices by the said cheques. At that stage, the accused did not claim that the payment in respect to the said 61 invoices, or any part thereof was liable to be adjusted from the so-called security deposit or claims under other heads. There is no explanation furnished by the accused for its aforesaid conduct. 32. In view of the said 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. These findings returned by the learned Magistrate are completely contrary to the stand taken by the accused in the response to the statutory notice under Section 138 of the NI Act and, therefore, contrary to the evidence brought on record. 33. The complainant had specifically disclosed in the complaints itself that as desired by the accused, the security deposit of Rs. 1.35 lacs aga....