Summary
The Supreme Court affirmed reversal of acquittals for dishonour of seven cheques. Admitted signatures and the established foundational facts attracted presumptions of consideration and enforceable debt, which the accused failed to rebut by a probable defence. Bare denial and unsupported suggestions could not displace them, especially in light of his written debt acknowledgment. The Court removed substantive imprisonment but retained fines totalling Rs 42 lakh, with concurrent default imprisonment if unpaid.
Issues
- Whether the accused rebutted the statutory cheque presumptions.
- Whether the High Court properly reversed acquittal.
- Whether the sentence required modification.
Provisions considered
- Sections 118(a) and 139, Negotiable Instruments Act, 1881The established foundational facts required presumptions of consideration and enforceable debt, rebuttable by the accused on a preponderance of probabilities. (¶ 13–17)
Held
- An accused may rely on the complainant’s evidence or circumstances and need not necessarily lead separate defence evidence. However, a probable defence must emerge; bare denial or merely suggesting an unsupported alternative transaction did not suffice here. (¶ 15–18.4)
- The signed acknowledgment identified the debt and cheque particulars. It was an acknowledgment by the accused, not a bilateral agreement requiring the complainant’s signature, and could not be discarded on the grounds advanced. (¶ 18.5–18.7)
- After drawing the presumptions, the trial court wrongly approached the matter as though the complainant still bore the initial burden of independently proving the loan source without the accused first establishing a probable rebuttal. Its fundamentally flawed assessment justified appellate reversal. (¶¶ 17, 19–22)
- Given the regulatory nature and the combined monetary sanction, substantive imprisonment was removed. Each Rs 6 lakh fine remained payable within two months, with one-year default imprisonment running concurrently across the seven cases and Rs 5.5 lakh compensation per case from the fines. (¶ 23–25)
Result
Appeal partly allowed: seven convictions upheld. Substantive imprisonment removed; Rs 6 lakh fine per case payable within two months, with one-year concurrent default sentences. Rs 5.5 lakh per case payable to complainant from recovered fines; trial court to enforce.