The rebuttable presumption under Section 139 of the N.I. Act requires the accused to present a probable defense, affirming the standard of proof is preponderance of probabilities.

JUDGMENT :

JOHNSON JOHN, J.

1. This appeal by the complainant is against the acquittal of the accused under Section 138 of the Negotiable Instruments Act, 1881 (‘N.I Act’ for short).

2. As per the complaint, the accused, a friend of the complainant, borrowed Rs.50,000/- on 06.05.2006 and subsequently on 07.08.2006, the accused issued a cheque dated 09.08.2006 for Rs.50,000/- to the complainant in discharge of the debt.

3. When the complainant presented the cheque for collection, the same was dishonoured due to insufficiency of funds in the account of the accused and in spite of issuance of statutory notice, the accused failed to pay the cheque amount to the complainant.

4. Before the trial court, PW1 examined and Exhibits P1 to P6 were marked from the side of the complainant and from the side of the accused, DW1 examined and Exhibit D1 marked.

5. After hearing both sides and considering the oral and documentary evidence on record, the trial court found that the accused has succeeded in rebutting the statutory presumptions and that the complainant has not succeeded in proving the offence under Section 138 of the N.I Act against the accused and hence, the accused was acquitted.

6. Heard Smt. Bhavan J. Menon, the learned counsel representing the learned counsel for the appellant on record, Sri. Chelson Chembarathy, the learned State Brief appearing for the accused/first respondent and Sri. Alex M. Thombra, the learned Senior Public Prosecutor appearing for the second respondent.

7. The learned counsel for the appellant argued that the accused has not disputed the signature in Exhibit P1 cheque and that the trial court has not appreciated the evidence in a proper manner and the finding of the trial court that the accused has succeeded in rebutting the statutory presumptions is not legally sustainable

8. The learned State Brief appearing for the accused/first respondent argued that the specific case of the complainant is that she used the consideration received in connection with the sale of her property for advancing the loan to the accused and the evidence of DW1 and Exhibit D1 would show that the complainant has not received any money as consideration for executing Exhibit D1, mutual exchange deed, and that the evidence of PW1 in cross examination would show that she availed a loan of Rs.50,000/- from Cheruvannoor Co-operative Bank and a loan of Rs.40,000/- from Thiruvannur KDC Bank for her personal needs.

9. In cross examination, PW1 stated that one Raveendran has introduced the accused to her. According to PW1, she sold her property to one Manilal. PW1 denied the suggestion that she has no acquaintance with the accused and that she filed the case after obtaining the cheque from one Raveendran. She also denied the suggestion that the accused never had any transaction with her.

10. The evidence of DW1, Manilal, and Exhibit D1, certified copy of Exchange Deed No. 355 of 2006, clearly shows that there was no financial transaction between the parties in connection with the execution of the said exchange deed and therefore, I find that the accused has succeeded in rebutting the presumption regarding consideration in favour of the complainant. In Shree Daneshwari Traders (M/s.) v. Sanjay Jain and Another [2019 (4) KHC 495] , the Honourable Supreme Court held thus:

“20. The accused in a trial under S.138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non - existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. To rebut the statutory presumption