Presumption under cheque dishonour law was rebutted where the complainant failed to prove financial capacity for the alleged loan.

Admission of the cheque signature triggered the statutory presumption under Section 139 of the Negotiable Instruments Act, 1881, but the complainant still had to show a legally enforceable debt. The complainant's evidence of a modest salary, no income-tax status, and no reliable proof of financial capacity to advance the alleged loan undermined that case. The accused raised a probable defence and rebutted the presumption on the balance of probabilities. On that basis, the conviction under Section 138 was found unsustainable, the revision was allowed, and the applicant was acquitted with reimbursement of any deposited compensation.

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Issues: Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 could be sustained when the complainant failed to establish financial capacity to advance the alleged loan and the accused had rebutted the statutory presumption.

Analysis: The cheque signature having been admitted, the statutory presumption under Section 139 of the Negotiable Instruments Act, 1881 operated in favour of the complainant. However, the complainant's own evidence showed a modest salary, absence of income-tax status, and no convincing proof of financial ability to advance Rs. 2.20 lakhs. In the circumstances, the accused raised a probable defence and successfully rebutted the presumption, while the complainant failed to prove the existence of a legally enforceable debt with reliable evidence.

Conclusion: The conviction under Section 138 of the Negotiable Instruments Act, 1881 was not sustainable and the revision was allowed, resulting in acquittal of the applicant and reimbursement of any deposited compensation.

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