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IN THE HIGH COURT OF KARNATAKA KALABURAGI BENCH
M.G.Uma
Sidaray M. Biradar – Appellant
Versus
Basavaraj S/O Mallappa Yadavannavar – Respondent
JUDGMENT :
M G Uma, J.
The complainant in C.C.No.5324/2018 on the file of learned II Additional Civil Judge and JMFC-II Vijayapur (for short ‘Trial Court’), registered for the offence punishable under Section 138 of Negotiable Instruments Act, 1881 (for short ‘N.I.Act’), is impugning the judgment of acquittal dated 09.10.2020, acquitting the respondent/accused for the above said offence.
2. For the sake of convenience, the parties are referred to as per their rank before the Trial Court.
3. The complainant has filed the private complaint in P.C.No.624/2018 before the Trial Court against the accused alleging commission of the offence punishable under Section 138 of N.I.Act. It is the contention of the complainant that, he was having cordial relationship with the accused since 2014. During February, 2018 the accused approached the complainant and sought for loan of Rs.10,00,000/- to meet his family necessities. The complainant and his son have promised to arrange for the same and accordingly, gave Rs.10,00,000/- to the accused who agreed to repay the same. When the complainant insisted for returning the amount, the accused issued the cheque as per Ex.P1 dated 08.08.2018 for Rs.10,00,000
Court held that issuance of a cheque raises a presumption of debt, shifting the burden to the accused to demonstrate otherwise, particularly upon admission of signature.
The signed blank cheque carries a legal presumption of liability under the Negotiable Instruments Act, shifting the burden of proof to the accused to demonstrate non-liability.
A signed cheque creates a presumption of liability in favor of the payee, where the accused must prove otherwise to avoid conviction under Section 138 of the Negotiable Instruments Act.
The court established that once a cheque is issued and signed, a legal presumption exists regarding its use for a valid debt, shifting the burden of proof to the accused to deny its validity.
The issuance of a negotiable instrument establishes a presumption of liability, shifting the burden to the accused to disprove the debt, as established by Sections 118 and 139 of the N.I. Act.
Presumption of legally enforceable debt arises upon admission of cheque by the accused; failure to rebut results in liability for cheque dishonor.
The court reaffirmed that the burden of proof lies on the accused to disprove the presumption of liability under Section 139 of the Negotiable Instruments Act.
The burden of proof, legal presumptions, and the accused's admission of debt in the issuance of the cheque are crucial in determining liability under the Negotiable Instrument Act.
Presumption under Section 139 of the Negotiable Instruments Act requires the accused to present credible evidence to rebut the holder's claim of legal liability regarding the cheque issued.
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