Cheque admission and statutory presumptions under the Negotiable Instruments Act sustained the conviction for dishonour liability.

Where execution of a cheque is admitted, presumptions under Sections 118 and 139 of the Negotiable Instruments Act arise in favour of the holder, and the accused must rebut them on a preponderance of probabilities. The accused failed to establish that the cheque was issued only as a security cheque or without consideration. The evidence showed that the cheque was issued towards repayment of an enforceable liability arising from unauthorised transfer of the complainant's money to a third party. The challenge to the conviction under Section 138 therefore failed, and the finding of guilt was upheld.

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Issues: Whether the conviction under Section 138 of the Negotiable Instruments Act was liable to be set aside on the ground that the cheque was issued only as a security cheque and without consideration.

Analysis: The accused admitted issuance of the cheque. Once issuance was admitted, the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act operated in favour of the holder of the cheque. The evidence showed that the accused had unauthorisedly transferred the complainant's money to a third party and the cheque in question was issued towards repayment of that liability. The plea that the cheque was a mere security cheque was not established on a preponderance of probabilities. The Court also held that the liability was legally enforceable and that the accused had failed to rebut the presumption arising in favour of the complainant.

Conclusion: The challenge to the conviction failed and the finding of guilt under Section 138 of the Negotiable Instruments Act was upheld.

Ratio Decidendi: Where execution of a cheque is admitted, the statutory presumption of consideration and liability arises, and the accused must rebut it by proving, on a preponderance of probabilities, that no legally enforceable debt or liability existed.

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