LYCA FINANCE LTD. Vs. STATE & ANR.

JUDGEMENT

(1.) Petitioner seeks leave to appeal against the judgment dated 24th Jan., 2013 whereby complaint under Sec. 138 of the Negotiable Instruments Act, 1881 ('the Act', for short), filed by the petitioner against the respondent no. 2, has been dismissed, after trial.

(2.) Case set up by the petitioner, before the trial court, was that it had financed Rs. 42,600.00 to respondent no.2, to enable him to purchase a motorcycle. Loan-cum-hypothecation agreement dated 16th March, 2005 was executed between the petitioner and respondent no. 2. As per the agreement, respondent no. 2 was to pay Rs. 57,000.00 in 30 instalments. First instalment was payable on 15th April, 2005. Petitioner alleged that respondent no. 2 did not adhere to financial discipline resulting in accumulation of outstanding dues. On persuasion of petitioner the respondent no. 2 issued a cheque bearing no. 045159 dated 17th Feb., 2009 for Rs. 30,650.00 drawn on Indian Overseas Bank, Naraina, New Delhi to discharge his part liability. However, on presentation the cheque was returned unpaid vide banker s memo dated 19th Feb., 2009 for the reason Funds Insufficient . Since cheque amount was not paid within the prescribed period despite service of legal notice dated 13th March, 2009, hence, the complaint.

(3.) The complaint case was contested by respondent no. 2. Issuance of cheque was not disputed. However, it was alleged that cheque was as security cheque. Subsequently, it was accepted that it was not a security cheque. On the basis of evidence adduced by the parties, it was concluded that cheque amount was much more than the actual amount due, therefore, cheque was not in discharge of a legal liability. Trial court has meticulously scrutinised evidence adduced by the parties and on the basis thereof has held that, as per the loan agreement Ex. CW1/B, petitioner had advanced Rs. 42,600.00. As agreed the interest of Rs. 14,400.00 was also payable. Thus, total amount payable in instalments was Rs. 57,000.00. CW1 admitted in his cross-examination that respondent no. 2 had already paid about Rs. 40,000.00 to petitioner. Statement of account Ex. CW1/1 indicated that as on 16th Feb., 2009 Rs. 17,100.00 was outstanding balance. Over and above this, overdue charges of Rs. 12,451.48 were added. Even the aggregate of this amount comes to Rs. 29,551.48; whereas cheque amount was much more than this. Thus, the cheque being of higher amount could not be taken towards discharge of the existing legal liability.