Unsupported claims of cheque misuse do not rebut statutory presumptions under Sections 118 and 139.

The respondent alleged that the revisionist had borrowed ₹5,70,000 and, towards repayment of the legally enforceable debt, issued Cheque No. 293159 dated 08 July 2020 for the same amount.

The cheque was dishonoured for “Insufficient Funds.” Despite service of the statutory notice under Section 138 of the Negotiable Instruments Act, 1881 (“NI Act”), the revisionist failed to make payment, leading to the institution of Criminal Case No. 220 of 2020.

The Judicial Magistrate, Kashipur, convicted the revisionist under Section 138 of the NI Act and sentenced him to four months’ simple imprisonment and a fine of ₹6,10,000, of which ₹6,00,000 was directed to be paid as compensation to the respondent; two months’ additional imprisonment was prescribed in default of payment of fine.

The revisionist’s criminal appeal was dismissed by the First Additional Sessions Judge, Kashipur, on 21 August 2024, resulting in the present criminal revision.

The revisionist contended that he had not issued the cheque to the respondent but had handed it over to one Ramesh, and that it had subsequently been misused.

Whether the concurrent findings convicting the revisionist under Section 138 of the NI Act were perverse, manifestly erroneous, unsupported by evidence, or otherwise affected by illegality, material irregularity, or jurisdictional error warranting interference in criminal revision?

Whether the revisionist rebutted the statutory presumptions under Sections 118 and 139 of the NI Act by establishing a probable defence that the cheque had been handed over to Ramesh and was not issued towards discharge of a legally enforceable debt owed to the respondent?

The Court applied Section 138 of the NI Act, which criminalises the dishonour of a cheque issued towards discharge of a legally enforceable debt or liability when the drawer fails to make payment within the statutory period after receiving notice.

Sections 118 and 139 of the NI Act create rebuttable presumptions regarding the consideration for, and legally enforceable liability underlying, a cheque once its execution and signature are admitted.

The accused may rebut these presumptions by raising a probable defence supported by cogent material; a bare assertion is insufficient.

In exercising criminal-revisional jurisdiction, the High Court exercises a limited supervisory power and ordinarily does not re-appreciate or re-weigh evidence; interference with concurrent findings is justified only where they are perverse, manifestly erroneous, based on no evidence, or affected by patent illegality, material irregularity, or jurisdictional error causing miscarriage of justice.

The revisionist admitted his signature on the cheque, which named the respondent as the payee. Consequently, the presumptions under Sections 118 and 139 of the NI Act operated in the respondent’s favour.

Although the revisionist claimed that the cheque had been given to Ramesh and later misused, he produced no reliable or cogent evidence substantiating that defence.

The trial court had specifically examined whether the cheque was issued in favour of the respondent and rejected the revisionist’s case, while the appellate court independently re-examined the evidence and concurred with that finding.

The High Court found no material contradiction, omission, evidentiary infirmity, or circumstance sufficient to rebut the statutory presumption or demonstrate that the cheque was not issued towards a legally enforceable liability.

Since the concurrent findings were supported by evidence and reasoned conclusions, the limited scope of revisional jurisdiction did not permit interference.

The conviction under Section 138 of the NI Act and the sentence of four months’ simple imprisonment with a fine of ₹6,10,000, including ₹6,00,000 as compensation to the respondent and two months’ additional imprisonment in default of payment, were left undisturbed.

The criminal revision was dismissed as devoid of merit.