Admission of signatures on cheque -- Petitioner/accused has not been able to disown the factum of issuance of cheques in favour of the complainant and nor has come out with any convincing explanation as regards the reasons for which the said cheques were issued by him -- Once the signatures of the petitioner on the cheques in question are not disputed, a presumption can safely be drawn in favour of the holder as regards the existence of a legally enforceable debt.

(P&H HC) Decided on: 16.11.2022

Cheque bounce case – Time barred debt – Once a cheque is issued and upon getting dishonoured a statutory notice is issued, it is for the accused to dislodge the legal presumption available u/s 118 and 139 reply of the N.I. Act.

(SC) Decided on: 10.10.2022

Onus to rebut – Scope of evidence -- There is a mandate of presumption of consideration and the onus shifts to the accused on proof of issuance of cheque to rebut the presumption that the cheque was issued not for discharge of any debt or liability in terms of Section 138 of the Act -- To rebut this presumption, facts must be adduced by the accused which on a preponderance of probability (not beyond reasonable doubt as in the case of criminal offences), must then be proved.

(SC) Decided on: 09.03.2021

Admission of signatures on cheque – Statute mandates that once the signature(s) of an accused on the cheque/negotiable instrument are established, then these ‘reverse onus’ clauses become operative.

(SC) Decided on: 10.02.2021

Cheque bounce case -- Presumptions raised u/s 118 and Section 139 are rebuttable in nature – A probable defence needs to be raised, which must meet the standard of “preponderance of probability”, and not mere possibility -- Bare denial of passing of consideration would not aid the case of accused.

(SC) Decided on: 10.02.2021

Even if the arguments raised by the appellants at face value that only a blank cheque and signed blank stamp papers were given to the respondent, yet the statutory presumption cannot be obliterated.

(SC) Decided on: 10.02.2021

Quashing of complaint -- Rebuttal of -- Once the issuance of cheque is admitted/established, the presumption would arise u/s 139 of the N.I. Act in favour of the holder of cheque -- Burden lies upon the accused to rebut the presumption by adducing evidence -- When disputed questions of facts are involved which need to be adjudicated after the parties adduce evidence, the complaint u/s 138 of the N.I. Act ought not to have been quashed by the High Court by taking recourse to Section 482 Cr.P.C.

(SC) Decided on: 10.02.2020

Signature not denied on cheque -- Presumption of Complainant being holder of cheque and the signature on the cheque having not been denied by the accused, presumption shall be drawn that cheque was issued for the discharge of any debt or other liability.

(SC) Decided on: 09.04.2019

Source of fund for loan – Requirement of law – After purportedly drawing the presumption u/s 139 of the NI Act, the Trial Court proceeded to question the want of evidence on the part of the complainant as regards the source of funds for advancing loan to the accused and want of examination of relevant witnesses who allegedly extended him money for advancing it to the accused -- This approach of the Trial Court had been at variance with the principles of presumption in law -- After such presumption, the onus shifted to the accused and unless the accused had discharged the onus by bringing on record such facts and circumstances as to show the preponderance of probabilities tilting in his favour, any doubt on the complainant's case could not have been raised for want of evidence regarding the source of funds for advancing loan to the accused-appellant.

(SC) Decided on: 15.03.2019

Signature on cheque not denied -- Accused-appellant could not deny his signature on the cheques in question -- It is required to be presumed that the cheques in question were drawn for consideration and the holder of the cheques i.e., the complainant received the same in discharge of an existing debt -- Onus, therefore, shifts on the accused-appellant to establish a probable defence so as to rebut such a presumption.

(SC) Decided on: 15.03.2019

Complainant proved the issuance of cheque which contained signatures of the accused and on presentation of the cheque, the cheque was returned with endorsement “insufficient funds” -- Bank official-witnesses proved that the cheque was not returned on the ground that it did not contain signatures of the accused rather it was returned due to insufficient funds – Trial court as well as the Appellate Court found that cheque contained the signatures of the accused – Defence that cheque was stolen complainant – No evidence led by accused -- Defence taken that cheque was stolen rejected by the two courts below – No basis for the High court coming to the conclusion that the accused has been successful in creating doubt in the mind of the Court with regard to the existence of the debt or liability.

(SC) Decided on: 02.07.2018

Cheque bounce case -- Presumption u/s 139 can be rebutted by the accused by raising probable defence -- Giving no particulars of the loan amount, as to when it was advanced nor there being any document to support the loan transaction, corroborates the version that the accused has not borrowed the amount – Furthermore, the complainant in the evidence has stated that he himself borrowed the amount on interest @ 3 to 5% -- Defence of the accused is that he has given this cheque to son in 2008 -- Before issuing legal notice to the present accused, the complainant had issued legal notice to son of the accused – Presumption u/s 139 of the Act has been duly rebutted.

(P&H HC) Decided on : 19.09.2017

Cheque bounce case -- Rebuttal of presumption -- Complainant has not produced any document on record to show the loan transaction -- Neither income tax return nor any account books have been produced to show the transaction -- Agreement has not been proved on record as per law, but the oral statements support and corroborate the defence version -- Cheque is signed in Punjabi and filled by some other person of complainant side -- By raising probable defence, which is supported and corroborated by the cross-examination of the complainant's witnesses and by the defence witnesses, the presumption has been duly rebutted by the accused.

(P&H HC) Decided on: 19.05.2017

Service of Notice -- Once notice is sent by registered post by correctly addressing to the drawer of the cheque, the service of notice is deemed to have been effected -- Then requirements under proviso (b) of Section 138 stands complied, if notice is sent in the prescribed manner -- However, the drawer is at liberty to rebut this presumption -- Notice sent by registered post and is returned with postal endorsement “refused” or “not available in the house” or “house locked” or “shop closed” or “addressee not in station”, due service has to be presumed.

(SC) Decided on: 01.03.2017

Cheque bounce case -- Rebuttal of presumption -- Section 139 of the Act raises a presumption in favour of the holder of cheque to presume that he had received the cheque in discharge of whole or in part liability or any debt -- Presumption is rebuttable one, it was the convict who was at liberty to have established it otherwise.

(P&H HC) Decided on: 06.06.2016

Cheque bounce case -- Counsel fees cheque – Accused had already admitted his signatures and date put by him -- Story that the accused had misplaced the cheque was a false defence -- Accused was not able to raise even a probable defence and the statutory presumption comes into play -- So far as the security cheque is concerned, the law is clear that it is an acknowledgment of liability on the part of the drawer that the cheque holder may use the security as an alternate mode of discharging his liability -- Complainant was only supposed to prove that the cheque issued by the respondent was dishonored -- Onus had shifted upon the respondent when he admitted his signatures and it was for him to explain -- Order of acquittal is set aside and the accused is convicted for four months.

(P&H HC) Decided on: 21.12.2015

Cheque bounce case -- Pronote and receipts for Rs.6 lacs – As per plaintiff’s income tax return he himself is a debtor to the tune of Rs. 3 lacs -- This circumstance makes a dent upon the capacity of plaintiff to lend huge amount -- Non-production of record sought by the defendants has strengthened their defence in dislodging the presumption under Section 118 of the Act -- Plea was further shattered by the fact that the loan amount was never reflected in the income tax returns of plaintiff – In the absence of proof of money being available with the plaintiff, defendant(s) had succeeded in proving that the pronotes and receipts were without consideration.

(P&H HC) Decided on: 06.11.2015

Cheque bounce case -- Pronote and receipts – Presumption provides that every negotiable instrument was made or drawn for consideration, and every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration -- However, the presumption is rebuttable once the defendant by direct or circumstantial evidence proves on record that the promissory note was not supported by consideration in the manner stated therein -- Defendant can rebut the presumption under Section 118 of the Act by showing preponderance of probability in his favour and against the plaintiff.

(P&H HC) Decided on: 05.11.2015

Cheque bounce case -- Rebuttal of presumption -- No averment in the complaint to show when the loan was given by the complainant to the accused, in whose presence the loan amount was given and at which place – No evidence on the record that what amount has been given as loan and whether any interest etc. was to be paid or not -- No document on the record to show the liability and capacity of the complainant to lend such a huge amount -- No evidence on record that such a huge amount was withdrawn from the bank -- Further, this loan amount is not paid through negotiable instrument, as per provisions of the Income-Tax Act, such a huge amount cannot be paid in cash – Held, it is for the complainant to show that the cheque was issued for legally enforceable debt -- Presumption u/s 139 of the NI Act has been rebutted from the evidence of the complainant itself -- Reasonable doubt exists in the prosecution case and the Courts below have ignored all these facts and convicted the accused/petitioner -- Petitioner is acquitted.

(P&H HC) Decided on: 22.01.2015