Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Mad) 759

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
K.MURALI SHANKAR, J.
PL. Karuppan Chettiar - Appellant
Versus
R. Kumar - Respondent
CRL.A(MD).No. 719 of 2024
Decided On : 09-01-2026

Advocates Appeared:
For the Appellant : Mr. J. Anandkumar
For the Respondent: Mr. S. Bharathy Kannan.

A drawer of a cheque is presumed liable unless they provide evidence to rebut the presumption of issuance for debt repayment, established under Sections 138 and 139 of the Negotiable Instruments Act.

Headnote:(A) Negotiable Instruments Act - Sections 138, 139, and 118 - Complainant filed a complaint under Section 200 Cr.P.C. for cheque dishonor, asserting Rs.7,00,000/- was borrowed; cheque dishonored due to insufficient funds - The learned Judicial Magistrate acquitted the accused, leading to this appeal. (Paras 1, 2, 8, 9)

(B) Presumption under Section 139 - Upon proving the execution of a cheque, Section 139 creates a presumption of liability, which can be rebutted by the accused establishing a 'probable defence'. (Paras 10, 14, 36)

(C) Standard of proof - The burden lies on the accused to rebut this presumption via preponderance of probabilities, without needing to present evidence personally. (Para 16)

(D) Findings of Court - The court overturned the acquittal ruling, finding the accused liable under Section 138 based on the lack of evidence to counter the presumption established in favor of the complainant. (Paras 37, 40) (E)

Result: The appeal is allowed, setting aside the acquittal and convicting the accused with a fine and compensation. (Paras 40)

Table of Content
1. background of the criminal appeal. (Para 1 , 2 , 3)
2. complainant's account of loan and cheque dishonor. (Para 4 , 7 , 10)
3. accused's defense and rebuttal of claims. (Para 11 , 12 , 13 , 14)
4. burden of proof and presumptions under ni act. (Para 16 , 17 , 18 , 20)
5. judgment and penalty imposed. (Para 37 , 39 , 40)

JUDGMENT :

K.MURALI SHANKAR, J.

This Criminal Appeal is directed against the judgment made in C.C.No.153 of 2019, dated 05.06.2024 on the file of the learned Judicial Magistrate (Fast Track Court), Karaikudi, in acquitting the respondent/accused for the offence under Section 138 of Negotiable Instruments Act .

2.The appellant, who is the complainant, filed a complaint under Section 200 Cr.P.C., against the respondent for the offence under Section 138 r/w 142 of Negotiable Instruments Act .

3. For the sake of convenience and brevity, the parties hereinafter will be referred as per their ranking/status before the trial Court.

4.The complainant's case is :

a) The accused, having good acquaintance with the complainant, requested for a loan for development of his grocery shop, renewal of his son Singapore permit and for family expenses. Accordingly, the accused borrowed a sum of Rs.4,00,000/- on 15.05.2019 from the complainant, agreeing to repay the same within two months and executed a promissory note therefor.

b) The accused again approached the complainant and requested further loan for extending his son Singapore permit and borrowed a sum of Rs.3,00,000/- on 10.06.2019. The accused received back the promissory note already executed and issued a cheque, dated 25.07.2019 for Rs.7,00,000/- drawn on Indian Bank, Pattamangalam Branch for discharging the said loan.

c) As per the request of the accused, the complainant presented the cheque for collection on 25.07.2019 through his Bank Lakshmi Vilas Bank, Karaikudi, but the said cheque was returned dishonored as 'funds insufficient'. Hence, the complainant sent a legal notice, dated 02.08.2019 to the accused demanding to pay the amount covered by the cheque. The accused having received the notice, dated 03.08.2019, sent a reply notice, dated 16.08.2019 with false and untenable allegations. Since the accused failed to pay the cheque amount within the stipulated period, the complainant was constrained to file the above complaint against the accused for the alleged offence under Sections 138 r/w 142 of Negotiable Instruments Act .

5. The learned Judicial Magistrate, upon receiving the complaint, recorded the sworn statement of the complainant and on perusing the records, upon satisfied that there existed a prima facie case, took the case on file in C.C.No.153 of 2019 for the offence under Section 138 of Negotiable Instruments Act . The Court sent the summons along with copy of the complaint. After appearance of the accused, he was questioned about the offence alleged against him and he denied the commission of offence and pleaded not guilty.

6. During trial, the complainant examined himself as P.W.1 and exhibited 10 documents as Ex.P.1 to Ex.P.10. The accused examined himself as D.W.2 and examined one Annaveeran as D.W.1, but adduced no documentary evidence.

7. The learned Judicial Magistrate, upon considering the evidence both oral and documentary and on hearing the arguments of both the sides, passed the impugned judgment, dated 05.06.2024 holding that the complainant failed to prove the offence under Section 138 of Negotiable Instruments Act as against the accused beyond reasonable doubt, acquitted him under Section 255(1) of Cr.P.C. Aggrieved by the impugned judgment of acquittal, the complainant has preferred the present appeal.

8. Whether the impugned judgment of acquittal passed in C.C.No.153 of 2019, dated 05.06.2024 on the file of the learned Judicial Magistrate (Fast Track Court), Karaikudi, is liable to be set aside ? is the point for consideration.

9. Before proceeding further, it is necessary to refer Section 118 (a) and 139 of the Negotiable Instruments Act