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2026 Supreme(Online)(Mad) 44612
IN THE HIGH COURT OF JUDICATURE AT MADRAS
G.K.Ilanthiraiyan, J
V.Naveen – Appellant
Versus
S.Kalidass – Respondent
Criminal Revision Case
For the Appellants/Petitioners: N.Ponraj
For the Respondents: L.Baskaran
When an accused rebuts the presumption under Section 139 of the NI Act by showing a lack of legally enforceable debt or insufficient financial capacity of the complainant, the burden shifts to the complainant to establish the debt beyond reasonable doubt.
Headnote:The proceedings concern an offence under Section 138 of the Negotiable Instruments Act, 1881. The accused challenged the conviction and sentence imposed by the trial court, which were confirmed by the appellate court, based on the allegation that cheques issued to the complainant were dishonoured. The accused argued that there was no legally enforceable debt, the cheques were stolen, and the complainant lacked the financial capacity to lend the claimed amount. The Court found that the prosecution failed to establish the existence of a legally enforceable debt and noted that the presumption under Section 139 of the Act was successfully rebutted by the accused through consistent evidence and cross-examination. The central issue was whether the complainant proved the existence of a legally enforceable debt to sustain the conviction. The ratio decidendi established that once the accused successfully rebuts the statutory presumption by raising a probable defence—such as lack of source of income of the complainant or evidence of stolen cheques—the burden shifts back to the complainant to prove the debt. Failure to produce critical evidence, like the promissory note or proof of financial capacity, renders the complaint under Section 138 unsustainable. The final result is that the criminal revision case is allowed, the impugned judgments are set aside, and the petitioner is acquitted of all charges.
| Table of Content |
|---|
| 1. overview of charges and procedural history under ni act. (Para 2 , 3) |
| 2. defense arguments regarding absence of legally enforceable debt and rebuttal of statutory presumption. (Para 4) |
| 3. court observation on failure of complainant to prove debt and validity of rebuttal. (Para 6 , 7) |
| 4. final acquittal of the accused due to failure of proving legal liability. (Para 8) |
ORDER
This criminal revision case has been filed against the judgment dated 07.10.2021 passed in CA.No.566 of 2018 on the file of the III Additional District and Sessions Judge, Coimbatore thereby confirming the conviction and sentence imposed by the trial court in judgment dated 01.12.2018 in CC.No.365 of 2017 on the file of the learned Judicial Magistrate, Fast Track Court Magisterial Level-2, Coimbatore under Section 138 of NI Act.
2. The petitioner is the accused in the complaint lodged by the first respondent for the offence punishable under Section 138 of NI Act on the allegation that the accused and the first respondent are relatives and the accused used to borrow loan from the first respondent on various occasions. While being so, he borrowed a sum of Rs.50,000/- on 03.10.2008 and a sum of Rs.17,000/- on 06.10.2008. Further, he agreed to pay interest at the rate of 12% per annum and thereafter he had paid only a sum of Rs.9,200/- as interest. Further, once again the accused borrowed a sum of Rs.32,000/- and later he also borrowed another sum of Rs.48,000/-, in total a sum of Rs.1,47,000/-. In order to repay the said amount, after borrowal, on 26.03.2011, the accused and his mother had jointly executed promissory note in favour of the first respondent thereby it was agreed to repay the said amount with interest at the rate of 12% per annum. In order to repay the said amount, the accused issued two cheques for a sum of Rs.67,000/- and Rs.80,000/- respectively. Both were presented for collection. However, both were returned dishonoured for the reason ‘funds insufficient’. After causing statutory notice, the first respondent lodged complaint and the same was taken cognizance by the trial court.
3. In order to prove the complaint, the first respondent had examined himself as PW1 and marked Ex.P1 to Ex.P9. On the side of the accused, he had examined DW1 and DW2 and marked Ex.D1 to Ex.D3. On perusal of oral and documentary evidences, the trial court found the petitioner guilty for the offence punishable under Section 138 of NI Act and sentenced him to undergo six months simple imprisonment. He was also ordered to pay compensation to the tune of the cheque amount with interest. Aggrieved by the same, the accused preferred appeal and the same was dismissed confirming the order of conviction and sentence imposed by the trial court. Aggrieved by the same, this criminal revision case has been filed by the accused.
4. The learned counsel for the petitioner would submit that the first respondent failed to mention for what purpose the loan was availed by the accused. The first respondent failed to prove the source of income to lend such huge amount as loan since he is working as acting driver for the accused’s family. Though the first respondent categorically mentioned in his complaint that the petitioner agreed to pay interest, in his cross examination he categorically deposed that loan was not borrowed for any interest. Even assuming that the accused had paid interest to the tune of Rs.9,200/-, as per the calculation, interest at the rate of 12% per annum comes around Rs.18,760/-. The specific case of the accused is that the first respondent had stolen the cheques along with other cheques for which DW1 also lodged complaint against the first respondent. It was marked as Ex.D1 and the acknowledgment was marked as Ex.D2. Further, the first respondent also lodged another complaint against DW1 and it is also pending. In fact, on receipt of the statutory notice, the accused had sent detailed reply which was marked as Ex.P9. Therefore, the accused categorically
