Cheque dishonour presumption prevails when issuance, dishonour, and notice are proved and rebuttal evidence is absent.

In a cheque dishonour prosecution under the Negotiable Instruments Act, the complainant proved issuance and dishonour of the cheque, service of statutory notice, and non-payment within time, so the presumption of liability under Section 139 operated. The accused neither replied to the notice nor led evidence to rebut that presumption, and the defence that the cheque was stolen was treated as an afterthought. The appellate court erred by demanding civil-trial style proof of accounts and by ignoring proved materials, including relevant account entries. The acquittal was therefore unsustainable and was set aside, with the trial court's conviction restored.

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Issues: Whether the acquittal recorded by the appellate court in a prosecution under Section 138 of the Negotiable Instruments Act, 1881 was sustainable when issuance and dishonour of the cheque, service of notice, and failure to rebut the statutory presumption stood proved.

Analysis: The cheque issuance and its dishonour were established by the complainant's evidence, along with service of notice and non-payment within the statutory period. The accused did not reply to the notice and did not lead evidence to displace the presumption arising under Section 139 of the Negotiable Instruments Act, 1881. The trial court's appreciation of evidence showed that the cheque had been issued towards liability for goods purchased, while the defence that the cheque had been stolen was found to be an afterthought. The appellate court erred in approaching the matter as if strict civil proof of accounts was required, and in disregarding the statutory presumptions and the evidentiary value of the materials proved on record, including account entries relevant under Section 34 of the Evidence Act, 1872.

Conclusion: The acquittal was unsustainable and was set aside; the conviction judgment of the trial court was restored in favour of the complainant.

Ratio Decidendi: In a cheque dishonour prosecution, once issuance of the cheque, dishonour, and statutory notice are proved, the presumption under Section 139 operates unless rebutted by the accused, and an appellate court cannot displace a reasoned conviction by insisting on civil-trial style proof in the absence of rebuttal evidence.

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