Admitted Signature on Cheque Triggers S.139 NI Act Presumption; Revisional Court Won't Re-appreciate Evidence: Himachal Pradesh HC - 2025-07-10

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HP High Court: Admitting Signature on Cheque Triggers Presumption of Liability; Revisional Courts Can't Re-appreciate Evidence

Shimla: The Himachal Pradesh High Court, in a significant ruling on cheque dishonour cases, has reiterated that a revisional court cannot act as an appellate court to re-appreciate evidence and overturn concurrent findings of conviction. Upholding the conviction of an individual in a cheque bounce case, Hon’ble Mr. Justice RakeshKainthla affirmed that once the signature on a cheque is admitted, the presumption of a legally enforceable debt under Section 139 of the Negotiable Instruments Act, 1881 (NI Act) is automatically triggered, and the burden shifts to the accused to rebut it.

The High Court dismissed the criminal revision petition filed by Radha Krishan against his conviction and sentence, which were previously upheld by the Additional Sessions Judge-I, Solan.

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Background of the Case

The case originated from a complaint filed by D.D. Modgil , who alleged that he had given a friendly loan of ₹1.00 lakh to Radha Krishan in November 2019. To discharge this liability, Krishan issued a post-dated cheque for the said amount. However, when presented, the cheque was dishonoured due to ‘insufficient funds’. Despite a legal notice, Krishan failed to make the payment, leading to the filing of a criminal complaint under Section 138 of the NI Act.

The Trial Court found Krishan guilty, sentencing him to three months of simple imprisonment and a fine of ₹1,25,000. This decision was subsequently confirmed by the Appellate Court.

Arguments of the Petitioner and the Court's Rebuttal

In the revision petition before the High Court, the petitioner’s counsel, Mr. Parikshit Sharma , argued that the lower courts had erred in their judgment. The key contentions were: - The cheque was not issued for a legal liability but as a security for a third person, one Amit Kumar . - The complainant's case was riddled with contradictions, and he failed to prove his financial capacity, especially since the loan was not mentioned in his income tax returns. - The fine of ₹1,25,000 imposed by the Trial Court exceeded its jurisdictional competence.

The High Court meticulously addressed and dismissed each argument, relying on established Supreme Court precedents.

Limited Scope of Revisional Jurisdiction

Justice Kainthla began by defining the narrow scope of the High Court's revisional jurisdiction. Citing landmark Supreme Court judgments like Malkeet Singh Gill v. State of Chhattisgarh and Kishan Rao v. Shankargouda , the Court emphasized:

“The High Court in criminal revision against conviction is not supposed to exercise the jurisdiction like the appellate court, and the scope of interference in revision is extremely narrow. The object of the provision is to set right a patent defect or an error of jurisdiction or law.”

The Court held that it is impermissible for a revisional court to re-analyse evidence or interfere with concurrent factual findings unless they are perverse, based on no evidence, or have resulted in a gross miscarriage of justice.

The Unrebutted Presumption Under NI Act

The cornerstone of the judgment was the powerful presumption under Sections 118 and 139 of the NI Act. The Court noted that since the petitioner admitted his signature on the cheque, the presumption of it being issued for a legally enforceable debt was absolute.

"Once the execution of the cheque is admitted, Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability... The onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities."

The Court observed that the petitioner’s claim of acting as a guarantor was a "mere denial" without any supporting evidence. He failed to examine Amit Kumar or any other witness to substantiate his defence. The judgment cited Sumeti Vij v. Paramount Tech Fab Industries , stating, "The statement of the accused recorded under Section 313 of the Code is not substantive evidence of defence... there is no evidence to rebut the presumption."

Furthermore, the Court dismissed the argument that non-declaration of the loan in income tax returns was fatal to the complainant's case, terming it an insufficient ground for acquittal.

Competence to Impose Fine

Rejecting the petitioner's final contention, the Court clarified that Section 143 of the NI Act empowers a Magistrate to impose a fine exceeding the general limit of ₹5,000 prescribed in the Cr.P.C. Citing R. Vijayan v. Baby , the Court confirmed that a Magistrate can impose a fine up to twice the cheque amount in a Section 138 case.

The Court found the compensation of ₹25,000 over the cheque amount of ₹1.00 lakh to be reasonable, considering the interest lost and litigation costs incurred by the complainant over four years.

Final Decision

Concluding that the petitioner had failed to prove any legal infirmity, jurisdictional error, or perversity in the lower courts' judgments, the High Court dismissed the revision petition. The ruling serves as a strong reminder of the legal sanctity of cheques and the limited grounds on which concurrent convictions in such matters can be challenged in revision.