A bare challenge to financial capacity does not rebut NI Act presumptions.

The complainant alleged that the accused borrowed ₹1,50,000 on 14 November 2015 and later issued a cheque for that amount, which was dishonoured for insufficient funds. The accused did not pay after receiving the statutory notice

The Trial Court convicted him under Section 138 of the Negotiable Instruments Act, 1881 (NI Act), imposed one year’s simple imprisonment and a fine, and directed payment of ₹3,00,000 as compensation; the First Appellate Court affirmed the conviction and sentence

In revision, the accused challenged the findings, principally disputing the debt and the complainant’s financial capacity.

Whether the concurrent findings of guilt under Section 138 of the NI Act suffered from illegality, perversity, or material irregularity warranting interference in revision

Whether the substantive sentence of imprisonment should be modified to a fine, with compensation payable to the complainant

Section 138 of the NI Act provides for punishment by imprisonment for up to two years, a fine of up to twice the cheque amount, or both

Under Sections 118 and 139 of the NI Act, once the foundational facts are established, statutory presumptions arise in favour of the cheque holder; the accused may rebut them by raising a probable defence

A mere assertion that the complainant lacked financial capacity, without supporting material, is insufficient to rebut those presumptions

Section 357(1)(b) of the Code of Criminal Procedure, 1973 (Cr.P.C.) permits the Court to direct that an appropriate portion of a fine be paid as compensation

The Court also assessed the concurrent findings within the limits of its revisional jurisdiction

The accused did not seriously dispute that the cheque related to his bank account. The Court found that the cross-examination contained no specific suggestion disputing the complainant’s financial capacity and that the accused produced no cogent material to support that defence

Although the accused’s failure to reply to the statutory notice was not conclusive, the Court considered it with the other evidence

The defence and alleged inconsistencies between the witnesses did not displace the statutory presumptions or undermine the concurrent findings; the Court therefore found no basis to interfere with the conviction

However, given the nature of the offence, the cheque amount, the age of the transaction, and the period of pendency, it considered a fine in place of substantive imprisonment appropriate

In default of payment, the accused must undergo six months’ simple imprisonment; the fine is to be deposited before the Trial Court within eight weeks from receipt of the certified copy of the order