Advocates appeared:
For the Appellant(s) : Mr. Amarjit Singh Bedi, Adv. Ms. Surekha Raman, Adv. Mr. Shreyash Kumar, Adv. Mr. Harshit Singh, Adv. Mr. Sidharth Nair, Adv. M/S. K J John And Co, AOR
For the Respondent(s): Mr. Ankit Yadav, Adv. Mr. T. Mahipal, AOR Ms. Gunjan Rathore, Adv. Ms. Shivangi Gulati, Adv. Mr. Chaitanya Sonkeria, Adv. Ms. Aastha Harshwal, Adv. Mr. Merusagar Samantaray, AOR

Summary of the Judgment

This Supreme Court judgment, delivered by Justices Manmohan and N.V. Anjaria on 25-09-2025 in Sanjabij Tari v. Kishore S. Borcar & Anr. (Criminal Appeal No. 1755 of 2010), allows an appeal against the High Court of Bombay at Goa's ex-parte acquittal order dated 16-04-2009 under Section 138 of the Negotiable Instruments Act, 1881 (NI Act). It restores the concurrent convictions by the Trial Court and Sessions Court, emphasizing the presumptions under Sections 118 and 139 of the NI Act, the quasi-criminal and compoundable nature of the offense, and issuing comprehensive guidelines to expedite Section 138 cases amid massive pendency. (!) (!) (!) (!)

Key Legal Principles

1. Violation of Section 269SS of Income Tax Act Does Not Invalidate Transactions Under NI Act
   A breach of Section 269SS (prohibiting cash loans above Rs. 20,000 without specified modes) attracts only a penalty under Section 271D of the Income Tax Act. Such transactions are not illegal, invalid, or void, and do not rebut presumptions under Sections 118 and 139 of the NI Act or render the debt unenforceable under Section 138. Cheques must be honored to maintain trust in the instrument. (!) (!) (!)
   

2. Presumptions Under Sections 118 and 139
   Once cheque execution is admitted, it is presumed to be for consideration (Section 118) and discharged a legally enforceable debt (Section 139). These rebuttable presumptions shift the onus to the accused to prove otherwise via evidence, documents, or cross-examination. Failure to reply to statutory notice infers the cheque was for a debt. Defenses like financial incapacity of the complainant must be substantiated; mere reliance on complainant's evidence is insufficient without independent proof. (!) (!) (!) (!) (!) (!) (!)
   

3. Revisional Jurisdiction Limits
   High Courts, in revisional powers, cannot re-appreciate evidence or upset concurrent factual findings absent perversity or jurisdictional error, even if lower courts erred. (!) (!) (!) (!)

4. Nature of Section 138 Offense and Sentencing
   The offense is quasi-criminal, aimed at ensuring payment and cheque credibility, not retribution. It is compoundable under Section 147 NI Act. Courts may suggest compounding, guilty pleas with lenient sentencing under Cr.P.C. Sections 255(2)/(3) [now BNSS Section 278], or Probation of Offenders Act benefits. (!) (!) (!) (!)

Facts and Findings

• Complainant advanced Rs. 6 lakhs as a friendly loan to accused (a friend); accused issued a cheque that bounced.
• Accused admitted signing the cheque but claimed it was blank/security for a bank loan and questioned complainant's financial capacity (low salary). No reply to notice; no independent evidence led by accused.
• Lower courts convicted, finding presumptions unrebutted and complainant's testimony credible (funds from father and own loan). High Court acquitted in revision on financial capacity and "blank cheque" defense.
• Supreme Court reversed, holding accused failed to rebut presumptions; defense was afterthought and unbelievable; no perversity in lower findings. Directed accused to pay Rs. 7.5 lakhs in 15 EMIs. (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!)

Guidelines for Section 138 NI Act Cases (Mandatory from 01-11-2025)

To address pendency (e.g., 6.5 lakh cases in Delhi), the Court issued binding directions: (!) (!) (!) (!)

Guideline	Details
Summons Service (!)	Usual modes + dasti by complainant + electronic (email/WhatsApp per BNSS Sections 64, 530). Complainant to provide accused details via affidavit; file service affidavit.
Online Payment (!)	Districts to enable QR/UPI for immediate payment/settlement at summons stage.
Complaint Format (!) - (!)	Mandatory synopsis post-index with party/cheque/dishonour/notice/cause details.
Pre-Cognizance (!)	No summons under BNSS Section 223 needed before cognizance.
Summary Trial (!) - (!)	Record reasons for conversion to summons trial. Post-cognizance, ask key questions (cheque ownership, signature, liability, defense type, compounding intent) under Cr.P.C. Section 251 / BNSS Section 274.
Interim Compensation (!)	Order under Section 143A NI Act early.
Hearings (!)	Prefer physical courts post-summons for settlement; digital pre-summons.
Evening Courts (!)	High Courts to raise realistic pecuniary limits (e.g., Delhi's Rs. 25,000 too low).
Monitoring (!) (!)	Dashboards in Delhi/Mumbai/Calcutta; monthly reviews; HCs to form committees for mediation/Lok Adalats.

Updated Compounding Guidelines (revising Damodar S. Prabhu): (!) - (!)
- Pre-defense evidence: No cost.
- Post-defense evidence, pre-judgment: 5% cost.
- Appellate/Revisional stage: 7.5% cost.
- Supreme Court: 10% cost.
Courts to encourage; suggest guilty plea/probation if complainant demands more. (!) - (!)

This judgment reinforces NI Act's intent for swift enforcement, prioritizes presumptions, and mandates procedural reforms for efficiency. (!) (!) (!) (!) (!) (!)