TaxTMI 
TaxTMI 
2021 (2) TMI 1243
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....28.11.2002 for Rs. 6,00,000/- of Canara Bank, Rasipuram assuring that, sufficient balance is available in the account. The cheque was presented on 11.12.2002 for collection. The cheque returned on the same day with endorsement "Not arranged for. Exceeds arrangement and Payment stopped by the drawer". The plaintiff met the defendants and informed them about the bouncing of the cheque. The defendants promised to pay the money soon. Next day, on 12.12.2002, the defendants came to the plaintiff house and asked him to come to the Office of the Lorry Owners Association with the cheque and get the cash. Believing their words, the plaintiff went to the Office of the defendants. At the defendants Office, the defendants and three others forcible took the cheque and the bank intimation slip from him. They told him that the money will be paid only after verification of the accounts and till then, the plaintiff should not trouble them demanding the money. They refused to give back the cheque and the bank slip. The attempt of the plaintiff to get back his money through one A.K.B.Chinnaraj, Treasurer of the Lorry Owners Association and others failed. Hence, on 14.12.2002, the plaintiff gave a Cri....
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....11.12.2005). Written statement of the defendants:- 5. The 1st defendant has filed written statement and same adopted by the 2nd defendant. According to the defendants, the suit is not maintainable since it is barred by limitation. The suit is liable to be dismissed for non-joinder of the necessary party viz., the Lorry Owner Association. The averment that the defendants borrowed Rs. 6,00,000/- on 20.11.2002 from the plaintiff as hand loan and on 27.11.2002 gave cheque dated 28.11.2002 to discharge the loan are denied. If the said averment made in the plaint is true, then the plaintiff need not have waited till 11.12.2002 to present the cheque for collection. In fact, blank signed cheque was left with one Sankar, the Manager of the Petrol Bunk to use it in case of emergency. Mr.Sankar, died on 10.12.2002. The said Sankar is a close family friend of the plaintiff. The blank signed cheque stolen and been misused by the plaintiff by filling up his name and amount. The allegation that the cheque and the bank intimation slip was forcible taken from the plaintiff by the defendants is false and invented story of the plaintiff. The reason stated for not producing the original cheque i....
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....filed against individuals as Officer bearers of the Lorry Owners Association, later amended deleting the name of the individuals. The amendment is fatal to the case of the plaintiff. The plaintiff failed to ascertain the signatory of the cheque. Regarding the signatory of the Cheque, the plaintiff has taken different plea in the suit and another in the Criminal complaint. The Trial Court ought to have taken note of this inconsistency and dismissed the suit as not proved. The Trial Court failed to note that the cheque in question was stolen from the table drawer of the Association. Taking advantage of the demise of its Manager Sankar on 10.12.2002, the plaintiff and others came to the bunk and taken away the signed cheques. The stolen cheque was presented later. The facts admitted by the plaintiff during the cross examination not given due consideration by the Trial Court. 11. The Learned Counsel for the appellant submitted that the Trial Court failed to consider that the plaintiff has not proved the existing debt. No evidence to show the plaintiff have financial capacity to lend Rs. 6,00,000/- or he lend Rs. 6,00,000/- to the Office bearers of the Association. The presumption un....
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....iven facts and circumstance accepted the secondary evidence and marked as Ex.A-1. The defendants have extensively cross examined P.W-1 about the whereabouts of the original cheque. 15. The specific case of the plaintiff in the plaint as well as in his testimony regarding the original cheque was that, he was called for settling the due by the defendants and believing their words went to the Office of the defendants on 12.12.2002. The defendants forcible took away the cheque and informed, they will pay the money after verifying the account. The plaintiff gave police complaint about this and the police got back the cheque from the defendants but did not return it to him. In C.M.P.No.703 of 2003 filed before the Judicial Magistrate Court. The Inspector of Police, in response to the petition to produce the original cheque stated that, he has handed over the original cheque to 2nd defendant. Under these circumstances, the High court granted permission to proceed with the Criminal prosecution under Section 138 of Negotiable Instrument Act, based on the photocopy of the cheque. The defendants never challenged that order before the Hon'ble Supreme Court. The certificate copy of the d....
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....ssued by the Lawyer on the instruction of the plaintiff, it is stated that after the police complaint dated 14.12.2002, the original cheque was returned back to the plaintiff on 17.12.2002. In the plaint, a different stand taken stating the original is not in his possession. The plaintiff is not certain whether the original cheque is with him or with the 2nd defendant or with the Inspector of Police. Thus, his case that the original cheque was forcible taken away from plaintiff itself an imaginary story hard to belief. When the issuance of cheque for existing debt itself is doubtful, the presumption under Section 118 Negotiable Instrument Act, ought not to have drawn. 21. The above said contention are not in favour of the appellant in any manner. The plaintiff had proved to the core that the defendants Association cheque dated 28.11.2002 for Rs. 6,00,000/- drawn in his favour was presented for collection on 11.12.2002 and the said cheque returned with endorsement exceeds arrangement and payment stopped by the drawer. Any contradiction regarding the present possessor of the original cheque will not be fatal for the plaintiff's case since those contradictions are not material ....
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....in the plaint does not exist and once the presumption is so rebutted, the said presumption "disappears". For the purpose of rebutting the initial evidential burden, the defendant can rely on direct evidence or circumstantial evidence or on presumptions of law or fact. Once such convincing rebuttal evidence is adduced and accepted by the Court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the plaintiff who has also the legal burden." 25. In Hiten P.Dalal v. Bratindranath Banerjee [(2001) 6 SCC 16 : 2001 SCC (Cri) 960] this Court compared evidentiary presumptions in favour of the prosecution with the presumption of innocence in the following terms: "22....Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter, all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fac....
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....ng an Association, the account books of the defendants if produced, the truth about the money transaction between the plaintiff and the defendants Association would have surfaced. P.W-1 has specifically deposed that the subject cheque was written by the second defendant. The defendants have not disputed it. When the burden to rebut the legal presumption is casted upon the defendants, the non-production of evidence to probablise the defence is fatal to the case of the defendants. 25. In the instant case, presumption of existing debt has to be drawn since the defendants have failed to rebut the presumption against them. The explanation given by the defendants regarding the cheque is not a plausible explanation. No direct or circumstantial evidence adduced before the Court to rebut the statutory presumption. 26. Limitation: The cheque dated 28.11.2002 issued to discharge the existing debt incurred on 20.11.2002. The said cheque presented for collection and got dishonour on 11.12.2002. The suit for recovery of money filed on 12.12.2002. (i). Section 6 of the Negotiable Instrument Act, defines:- Cheque is a bill of exchange drawn on a specified banker and not expressed....
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....of Section 20, Limitation Act. Reliance was sought to be placed upon judgment of the Calcutta High Court in Kedar Nath v. Dinobandhu Saha (1916) cal 580. In that case, Sir Lawrence Jenkins, Chief Justice, delivering the judgment of Court held that if a cheque is delivered to a payee by way of payment and is received as such, it operates as a payment subject to a condition subsequent that if upon due presentation the cheque is not paid, the original debt revives. It was further held that where such a cheque is signed by the debtor and paid in part payment of the principal of a debt, the cheque being subsequently honoured, the proviso to Section 20 of the Limitation Act has been complied with. It is evident from the judgment in 'Kedar Nath's case (A) that a cheque was given in partpayment, it was received in part-payment and the cheque was honoured and the Court held in that case that the requirement of the proviso to Section 20, Limitation Act was complied with. In the present case the cheque was dishonored and when it was dishonored, the amount of the cheque cannot be regarded as part-payment of the principal. It is true that when a cheque is delivere....
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....dence to corroborate the original cause of action and does not constitute a cause of action by itself to institute a suit. 10. Per Contra, the Counsel for the respondent relied on the ruling of this Court in Surendra v. Smt. Padma [ILR 2000 Kar 579.], it is held thus: "8. Here in this case, the Court below not examined the plaint properly and ignored from considering the material allegations, plaintiff's case is that defendant borrowed the money, no doubt in 1991. His further case is that defendant gave the cheque in payment of that amount, thereafter he changed the dates and, later on when the cheques were presented to the Bank for payment on 8th September and 9th of September 1992, the Bank dishonored the cheques on 8th September with endorsement to the effect, insufficient funds in the account and the other on 9th of September that, the accountholder is dead. So this cheque and the cause of action for the suit and valuation of claim in the suit have also been given on the basis of amount of cheque which defendant had given and which Bank had dishonored. It appears to be that this is a cheque for recovery of amount which is the subject-matter of cheque and w....
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.... filed is within time." 29. When a case almost identical to the facts of the instant appeal came for consideration before the Hon'ble High Court of Delhi, in Ajanta Raj Proteins Private Limited & another vs. Himanshu Foods Private Limited reported in 2018 SCC Online Del 6874, Delhi High Court, after extensive analysis of law, has held that, the limitation will start only from the date of dishonor of cheque and not from the date of the cheque. "16.The date of the cheque is 21st November, 2010. The return memo of HDFC Bank which quoted the remarks of Axis Bank is dated 10th May, 2011. The cheque issued by the Defendants was drawn on Axis Bank. The suit has been instituted on 8th May 2014. Thus, it is filed within three years of the date of dishonour of the cheque, but beyond three years from the date of cheque. The Defendant argues that the limitation has to be construed from the date of the cheque and not the date of dishonour." 17. The Defendants place heavy reliance on the judgment of the Learned Single Judge of this Court in Empire Home Appliances Pvt. Ltd. vs. Suraj Enterprises reported in 2016 SCC OnLine Del 3954, (dated 3rd May 2016 in R.F.A.No.208 of 2016....
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....red as 'Rohini Strips'). The Court was dealing with a suit under Order XXXVII of the C.P.C., wherein, leave to defend had been refused. The Learned Single Judge of this Court in Steel Authority (supra) had taken into consideration Article 35 of the Limitation Act and held as under:- "...I am of the considered view that the limitation would commence to run from the date when the cheques in question were returned unpaid to the plaintiff. Since in this case the cheques in question were admittedly returned unpaid to the plaintiff on the ground 'not arranged for' on 01.6.2000, the present suit filed on 23.05.2003 is to be taken as filed within limitation. Hence, the objection regarding limitation taken by the defendants has no merit..." 20. The Division Bench in Rohini Strips (supra), observing that there was no illegality in the Single Judge's Order, notes that the cause of action did not arise till the cheques were dishonoured. The Court held:- "4.We find no illegality in the aforesaid order. The cheques were given by the appellants to the respondent only on 16.3.2000. The aforesaid cheques were to be encashed after presentation in terms ....
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....ment of Rohini Strips (supra). The facts in Empire Home Appliances (supra) are distinguishable from the facts of the present case inasmuch as, in the said case, the suits were not simpliciter suits for recovery based on a cheque. The suits there were based on supply of goods, receipt of goods, credit notes issued, and thus, a much more detail factual analysis was required therein. 23. In the present case, however, though the transaction between the parties relates to supply of skimmed milk powder, the suit is a simple suit under Order XXXVII of the C.P.C based on a cheque. The cheque was valid on the date it was presented. It was returned due to 'insufficient funds'. It is the Defendants' contention that the cheque for Rs. 15,00,000/- has been issued as a security, however, there is no document to this effect. The Plaintiff simply submits that the cheque in question was dishonoured and that gave it a cause of action to file the suit for recovery. The cause of action arose only when the cheque was dishonoured and hence, the suit is filed within limitation." 30. To sum up, it is suffice to say, that a cheque is bill of exchange. The period of limitation is thr....
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....the part of the plaintiff in compliance of Section 65 of the Evidence Act before introducing the secondary evidence. The exemption alleged to have granted by the High Court in Crl.R.C. No.1161 of 2003 in the Criminal proceedings will not perforce applicable to the civil case. Furthermore, the plaintiff has not even produced the said the order of High Court passed in Crl.R.C.No.1161 of 2003, to know the content of it and whether it has any persuasive value for accepting the secondary evidence. 33. In Ashok Dulichand v. Madahavlal Dube reported in (1975) 4 SCC 664, wherein, it has been held that; "According to clause (a) of Section 65 of the Indian Evidence Act, secondary evidence may be given of the existence, condition or contents of a document when the original is shown or appears to be in the possession or power of the person against whom the document is sought to be proved, or of any person out of reach of, or not subject to, the process of the court, or of any person legally bound to produce it, and when, after the notice mentioned in Section 66, such person does not produce it." Thereafter, the Court addressed to the facts of the case and opined thus: - ....
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....idence of the contents or in another form. The secondary evidence must be authenticated by foundational evidence that the alleged copy is in fact a true copy of the original. It should be emphasised that the exceptions to the rule requiring primary evidence are designed to provide relief in a case where a party is genuinely unable to produce the original through no fault of that party." 36. In H.Siddiqui (Dead) by Lrs. vs. A Ramalingam reported in [(2011) 4 SCC 240, while dealing with Section 65 of the Evidence Act, the Hon'ble Supreme Court, opined though the said provision permits the parties to adduce secondary evidence, yet such a course is subject to a large number of limitations. In a case where the original documents are not produced at any time, nor has any factual foundation been laid for giving secondary evidence, it is not permissible for the court to allow a party to adduce secondary evidence. Thus, secondary evidence relating to the contents of a document is inadmissible, until the non-production of the original is accounted for, so as to bring it within one or other of the cases provided for in the section. The secondary evidence must be authenticated by founda....