Once a signature on a cheque is admitted, a rebuttable presumption of legal debt arises under the Negotiable Instruments Act. The burden lies on the accused to rebut this via a preponderance of probabilities; failure to do so, through evidence or cross-examination, warrants upholding a conviction.

Headnote:(A) Negotiable Instruments Act, 1881 - Sections 138, 139 and 118 - Dishonour of cheque - Presumption of debt - Rebuttal of presumption - Standard of proof - The court reiterated that once the signature on the cheque is admitted, a presumption arises under Section 139 that the cheque was issued for the discharge of a legally enforceable debt. The burden of rebutting this presumption lies on the accused, who must establish a probable defence based on a preponderance of probabilities. It is not necessary for the accused to depose as a witness to rebut the presumption, as they may rely on materials already on record or cross-examination of the complainant. (Paras 5, 8, 9, 17, 18)

(B) Appellate Review - Criminal Revision - Interference - Once the trial court and the first appellate court have recorded findings of guilt based on evidence and the failure of the accused to rebut statutory presumptions, such findings should not be interfered with unless found to be perverse or contrary to law. (Paras 12, 19)

Facts of the case:
The revision petitioner, convicted for the offence under Section 138 of the Negotiable Instruments Act in multiple tiers of lower courts, challenged the orders. The accused had taken inconsistent defences, claiming the cheque was stolen in one instance and given as security in another. Despite having opportunity, the accused failed to lead defence evidence during the trial.

Findings of Court:
The court observed that the accused failed to establish any probable defence to rebut the presumption under Section 139. The inconsistent stand taken by the accused and the failure to provide evidence, despite the opportunity to cross-examine, led the court to conclude that the conviction was justified and the legal presumptions in favour of the complainant remained unrebutted.

Issues: Whether the trial court and first appellate court erred in convicting the accused for the offence under Section 138 despite the defences raised, and whether the presumption under Section 139 was effectively rebutted.

Ratio Decidendi: Where a drawer admits signature on a cheque, the court is mandated to draw a presumption of legal liability. If the accused fails to discharge the evidentiary burden of rebutting this presumption through a preponderance of probabilities—either by evidence or by highlighting contradictions in the complainant's case—the presumption holds, and conviction must follow.

Result: Revision petition dismissed.

Table of Content
1. presumption of debt under sec 139 ni act applies when signature is admitted. (Para 1 , 2 , 3 , 4 , 6 , 7 , 8 , 9 , 10 , 11 , 12)
2. review of precedents; presumption persists without cogent rebuttal evidence. (Para 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20)

THIS CRL.RP IS FILED U/S.397 R/W 401 CR.P.C. PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF CONVICTION DATED 04.11.2017 PASSED IN C.C.No.191/2014 PENDING ON THE FILE OF PRINCIPAL SENIOR CIVIL JUDGE AND JMFC, BELTHANGADY AND ITS CONFIRMATION IN CRL.A.No.161/2017 DATED 10.09.2018 PENDING ON THE FILE OF THE I ADDITIONAL DISTRICT AND SESSIONS JUDE, D.K. MANGALORE AND CONSEQUENTLY ACQUIT THE PETITIONER FOR THE OFFENCE P/U/S 138 OF N.I ACT.

THIS PETITION, COMING ON FOR FINAL HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE V SRISHANANDA

ORAL ORDER

Heard Sri K. Ravishankar, learned counsel for the revision petitioner. None appears for the respondent.

2. Accused who suffered an order of conviction for the offence punishable under Section 138 of the Negotiable Instruments Act in C.C.No.191/2014, confirmed by the First Appellate Court in Crl.A.No.161/2017 is the revision petitioner.

3. There is no dispute as to the issuance of cheque as the defence taken by the accused that the cheque is stolen is not established by placing necessary material evidence on record.

4. Pertinently, no action has been taken for the alleged issues. In another breath, the accused has also taken stand that the cheque in question was issued towards the security.

5. Learned Trial magistrate after recording the oral evidence of PW1 permitted the defence to cross examine even in the absence of an application under Section 145(2) of the Negotiable Instruments Act, without following the principles of law enunciated in the case of Indian Bank Association and others vs Union of India and others reported in (2014) 5 SCC 590.

6. Nevertheless, the contents of the reply was put across to the complainant, which has been denied by him.

7. For the reasons best known to the accused, he failed to enter into the witness box and lead defence evidence.

8. Therefore, presumption available to the complainant under Section 139 of the Negotiable Instruments Act stood unrebutted.

9. Further, the plea that has been taken by the accused that the cheque was stolen in one breath and cheque was given as a security which has been misused at another breath stands not proved by placing any material evidence on record.

10. No normal prudent person would keep quiet if a cheque is misused especially when he has engaged the services of an Advocate who has extensively cross examined PW1.

11. Pertinently, cheque is in a sum of Rs.4,00,000/- and the same is issued in the year 2011.

12. Taking note of these aspects of the matter order of conviction recorded by the learned Trial Magistrate, confirmed by the First Appellate Court needs no interference.

13. However, learned counsel for the petitioner placed on record following judgments and wants to establish that the reasoning established by learned Trial Magistrate, confirmed by the First Appellate Court is incorrect.

“1. (2025) Supreme SC 682- N Vijaya Kumar Vs. Vishwanath Rao N - Para 1, 3, 5, 6.3, 8, 9, 11 and 12.

2. (2024) 8 SCC 573- Dattatreya Vs. Sharanappa - Para 22 to 32

3. (2019) 5 SCC 418- Basalingappa Vs. Mudibasappa para 20, 23 to 26, 29 and 32

4. Crl.A. No.533/2015 dated 03/02/2025-HV Jagannatha Vs Prabhakar B J-para 3, 5, 10, 11, 13 and 17

14. Relevant portions of those judgments are culled out hereunder for ready reference:

(i) N VIJAY KUMAR v. VISHWANATH RAO N, 2025 SCC ONLINE SC 873

The present appeal is filed assailing the judgment dated 21st December 2020 passed by the High Court of Karnataka at Bengaluru in Criminal Appeal No. 94 of 2011, whereby the High Court reversed the order of acquittal passed by the Court of XV Additional Chief Metropolitan Magistrate, Bangalore City and convicted the appellant-accused under Section 138 of th

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THE HIGH COURT OF KARNATAKAV Srishananda, JU Harishchandra Thamankar – AppellantVersusVenkappa Kotian – RespondentCRIMINAL REVISION PETITION NO. 1379 OF 2018

Once a signature on a cheque is admitted, a rebuttable presumption of legal debt arises under the Negotiable Instruments Act. The burden lies on the accused to rebut this via a preponderance of probabilities; failure to do so, through evidence or cross-examination, warrants upholding a conviction.

Cases Referred (6)

THE HIGH COURT OF KARNATAKA
V Srishananda, J
U Harishchandra Thamankar – Appellant
Versus
Venkappa Kotian – Respondent
CRIMINAL REVISION PETITION NO. 1379 OF 2018