The main legal point established in the judgment is that the presumption under Section 139 of the Negotiable Instruments Act is rebuttable, and the accused can contest the existence of a legally enforceable debt or liability by raising a probable defense.

JUDGMENT

Harnaresh Singh Gill, J. - Leave to appeal has been sought against the judgment of acquittal passed by the learned trial Court in a complaint under Section 138 of the Negotiable Instruments Act, 1881 (for short the Act).

2. This Court has heard learned counsel for the applicant and with his able assistance gone through the paper book.

3. Learned counsel has submitted that in view of the presumption under Section 139 of the Act, once the signatures on the cheque are not disputed, it was for the respondent-accused to lead evidence and rebut the presumption available under Section 139 of the Act. Hence, he submits that in absence of evidence, the Court committed an error in dismissing the complaint and acquitting the respondent.

4. Learned trial Court, on appreciation of evidence, has found that the complainant is from a decorated Air Force Officers family, whereas the accused is from a very humble family and, thus, there cannot be any friendly relationship of the complainant with the accused, who is a mason by profession. It was further found that there was no acknowledgement of the loan or advancement of money; that the complainant had advanced money to about 50 persons and any person into the business of financing would get some documents executed before advancing money; that even the income tax returns filed by the complainant, as Mark-A and Mark-B did not reflect the advancement of loan to the accused; that the table shown by the complainant reflected two figures mentioned as loan amount and even that did not tally with the cheque in question and that the complainant had not placed on record the original of the power of attorney and only photocopy thereof (Ex. C1) was produced.

5. Learned counsel for the applicant, although made sincere attempt, yet failed to draw attention of the Court to any misreading or misinterpretation of substantive evidence.

6. No doubt, initial presumption is in favour of holder of the cheque in view of Section 139 of the Act, however, the same is rebuttable. It is permissible for the accused to rebut the same on the basis of evidence led by the prosecution.

7. In the present case, the aforesaid presumption stands rebutted. Reference in this regard can be made to the judgment passed by the Honble Supreme Court dealing with rebuttable presumption and reverse onus under Section 139 of the Act in the case of Rangappa v. Sri Mohan, (2010) 11 SCC 441 .

8. Paras 3, 26, 27 and 28 of the judgment passed by the Three Judge Bench in Ragappas case (supra) are extracted as under:-

'3. The legal question before us pertains to the proper interpretation of Section 139 of the Act which shifts the burden of proof on to the accused in respect of cheque bouncing cases. More specifically, we have been asked to clarify the manner in which this statutory presumption can be rebutted.'

xx xx xx

26. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances there in. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant.

27. Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to preve