An admitted cheque signature triggers the Section 139 presumption, rebuttable by a probable defence.

The complainant alleged that, in the course of business transactions concerning fish cultivation and sale, Ravichandran issued a cheque for ₹14,00,000, which was dishonoured when presented.

After notice and a reply from the accused, the complainant filed a complaint under Section 138 of the Negotiable Instruments Act, 1881.

The trial court convicted the accused and imposed two years’ simple imprisonment and compensation of ₹14,00,000 with interest at 9% per annum, with six months’ simple imprisonment in default; the appellate court affirmed the conviction and sentence.

In revision, the accused contended that the cheque had been issued for security and that no legally enforceable debt existed; the complainant relied on the accused’s admission of his signature, issuance of the cheque, and business dealings.

The accused also failed to comply with the High Court’s condition requiring deposit of the cheque amount for suspension of sentence, after which the Court proceeded to decide the revision on its merits.

1. Whether the accused rebutted the statutory presumption under Section 139 of the Negotiable Instruments Act that the cheque was issued towards a legally enforceable debt or liability

2. Whether the concurrent findings of conviction and sentence under Section 138 disclosed an error, illegality, or perversity warranting interference in revision

Section 138 of the Negotiable Instruments Act, 1881, criminalises the dishonour of a cheque issued towards a legally enforceable debt or liability, subject to the statutory requirements.

Under Section 139, once the accused admits the cheque signature, a presumption arises that the cheque was received towards discharge of a debt or liability; the accused may rebut that presumption by raising a probable defence.

In Rangappa v. Sri Mohan, (2010) 11 SCC 441, the Supreme Court recognised that the presumption includes the existence of a legally enforceable debt or liability.

In Bir Singh v. Mukesh Kumar, AIR 2019 SC 2446, the Court held that filling in the particulars of a voluntarily signed blank cheque does not, by itself, invalidate it, and the accused bears the onus of establishing that it was not issued towards a debt or liability.

The High Court noted that the accused did not dispute the business dealings, his signature on the cheque, or its issuance to the complainant.

It found that he produced no persuasive evidence to support his claim that the cheque was given only as security or had been misused, and therefore had not raised a probable defence sufficient to rebut the Section 139 presumption.

Applying Rangappa and Bir Singh, the Court concluded that the presumption remained unrebutted and that the courts below had properly found the cheque to have been issued towards a legally enforceable debt.

It found no error, illegality, or perversity warranting revisional interference.

The Court also recorded the accused’s failure to comply with the suspension-of-sentence deposit condition, but nevertheless decided the revision on its merits.

It cancelled the earlier order suspending the sentence and directed the trial court to secure the accused to serve the sentence.