Security cheque disputes under the Negotiable Instruments Act must usually be tested at trial, not quashed at the threshold.

A complaint under Section 138 read with Section 141 of the Negotiable Instruments Act could not be quashed under Section 482 CrPC merely on the plea that the cheques were issued as security and no enforceable debt existed. The Court treated whether liability had arisen, and whether the cheques were only security, as disputed questions of fact for trial. It held that the statutory presumption under Section 139 operated at the threshold, and the accused must rebut it through evidence. The challenge to the complaint and summoning order therefore failed.

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Issues: Whether a complaint under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881 could be quashed under Section 482 of the Code of Criminal Procedure, 1973 on the ground that the cheques were issued as security and that no legally enforceable debt or liability existed.

Analysis: The agreement between the parties contemplated issuance of cheques as part of the contractual security arrangement and also reserved liberty to initiate action under the Negotiable Instruments Act, 1881 in case of default. The question whether the cheques were given only as security or whether liability had arisen was held to be a disputed question of fact. In proceedings under Section 482 of the Code of Criminal Procedure, 1973, the Court would not undertake a meticulous examination of disputed factual defences or short-circuit the trial process. The statutory presumption under Section 139 of the Negotiable Instruments Act, 1881 operated at the threshold, and the accused was required to rebut it in trial. The authorities relied on by the petitioners were distinguished, while the later line of decisions treating security cheque disputes as matters for evidence was followed.

Conclusion: The complaint and the summoning order were not liable to be quashed at the threshold; the petitioners' challenge failed.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, a plea that the cheque was issued as security and that no debt or liability existed cannot ordinarily be resolved in proceedings under Section 482 of the Code of Criminal Procedure, 1973, because such matters involve disputed facts to be determined at trial in the light of the statutory presumption under Section 139.

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