A cheque issued in discharge of a legally enforceable liability constitutes basis for recovery under Section 138 of the N.I. Act, irrespective of prior acquittals in criminal cases.

JUDGMENT :

Vikram Aggarwal, J.

This is defendant’s second appeal against the judgment and decree dated 05.07.2016, passed by the Court of learned Additional District Judge, Kaithal, dismissing the appeal filed by the defendant against the judgment and decree dated 30.01.2016, passed by the Court of learned Civil Judge (Junior Division), Kaithal, vide which the suit for recovery filed by the plaintiff was decreed.

2. For the sake of convenience and clarity, parties shall be referred as per their original status.

3. The plaintiff filed a suit for recovery of Rs. 58,500/- (Rs. 45,000/- as Principal amount and Rs. 13,500/- as interest). The case set up was that the defendant had taken a friendly loan of 45,000/- from the plaintiff and had issued a cheque bearing No.623616 dated 18.09.2009 for Rs. 45,000/- in favour of the plaintiff in discharge of his legally enforceable liability. The cheque issuing slip in his hand writing duly signed by the defendant was also issued. On presentation, the cheque was dishonoured vide memo dated 19.09.2009 on the grounds of ‘insufficient funds’. A registered notice dated 29.09.2009 was issued to the defendant but despite the same, the payment was not made leading to the filing of the suit.

4. The defendant opposed the suit. In the written statement, certain preliminary objections as regards maintainability, locus standi, suppression of true and material facts and limitation were raised. On merits, the case set up was that the plaintiff and his son were running a financial committee whereof the defendant and other persons were members. The modus of the plaintiff was to obtain cheques from all members which included the defendant, as security. The said cheque was misused by the plaintiff. The cheques of other members were also misused and 60-70 complaints were filed by him under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as ‘the Act’). The defendant contested the said complaint and was acquitted vide judgment dated 31.10.2012, passed by the Judicial Magistrate Ist Class, Kaithal. It is thereafter that the suit was filed. The defendant denied having taken any loan or having issued any cheque.

5. Replication was filed in which the contents of the written statement were denied and those of the plaint were reiterated.

6. From the pleadings of the parties, the following issues were framed by the trial Court:-

1. Whether the plaintiff is entitled for decree for recovery of Rs.58,500/- alongwith interest @ 10% as prayed for ? OPP

2. Whether the suit of plaintiff is not maintainable? OPD

3. Whether the plaintiff has no locus-standi to file the present suit? OPD

4. Whether the suit of the plaintiff is time barred? OPD

5. Relief.

7. The parties led their respective evidence.

8. The trial Court decreed the suit filed by the plaintiff. The appeal filed by the defendant against the said decision was dismissed, leading to the filing of the present regular second appeal.

9. I have heard learned counsel for the appellant and the respondent in person.

10. Learned counsel for the appellant-defendant submits that both the Courts have erred in decreeing the suit. He submits that in fact the plaintiff was running a Committee and used to take cheques from all members. The plaintiff presented cheques of 60-70 persons which were dishonoured and he filed complaints under Section 138 of the N.I. Act which were also dismissed after which he filed recovery suits against all such persons. Learned counsel submits that for decreeing the suit, the plaintiff was su