Statutory presumptions in cheque dishonour cases can be rebutted by weak proof of funds and transaction credibility.

Statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act arose because cheque signatures were undisputed, but they remained rebuttable on the complainant's evidence and surrounding circumstances. The complainant failed to satisfactorily prove possession of cash at the relevant time, and the alleged advance was not corroborated by independent documentary evidence or material witnesses; the balance-sheet entry was also not independently proved. In an appeal against acquittal, interference is confined to cases where the trial view is perverse, wholly unreasonable, or based on misreading of evidence. The court found the trial court's assessment of probability and its treatment of Section 269-SS of the Income Tax Act did not make the acquittal perverse, so the acquittal was left undisturbed.

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Issues: Whether the acquittal under Section 138 of the Negotiable Instruments Act, 1881 warranted interference in appeal in view of the statutory presumptions, the evidence regarding the source and availability of funds, and the effect of Section 269-SS of the Income Tax Act, 1961.

Analysis: The cheque signatures were not disputed, so the presumptions under Sections 118 and 139 of the Negotiable Instruments Act, 1881 arose. However, those presumptions could be rebutted on the basis of the complainant's evidence and surrounding circumstances. The complainant did not satisfactorily establish possession of cash of Rs. 75,000/- at the relevant time, nor was the alleged advance supported by independent documentary proof or the testimony of material witnesses. The balance-sheet entry relied upon was not independently proved through the Chartered Accountant or the accounts themselves. The Court also held that the trial court's approach on the probability of the transaction and the relevance of Section 269-SS of the Income Tax Act, 1961 did not render the acquittal perverse. In an appeal against acquittal, interference is justified only when the view taken is perverse, wholly unreasonable, or based on misreading or non-consideration of evidence.

Conclusion: The acquittal was not shown to be perverse or based on misappreciation of evidence, and the appeal was not liable to succeed.

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