Section 138 cheque liability survives where signature is admitted, licence absence is irrelevant, and time-barred debt defence fails.

Admission of the cheque and signature attracted the presumption under Section 139 of the Negotiable Instruments Act, 1881. The Karnataka HC held that lack of a money-lending licence does not defeat a prosecution under Section 138, and that a cheque issued towards a time-barred debt can still sustain liability. Once issuance of the cheque in relation to a debt was proved, the defence of no enforceable debt was not accepted in the manner urged. The trial court's contrary view was held erroneous, the acquittal was set aside, and the accused was convicted under Section 138.

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Issues: Whether the acquittal for an offence under Section 138 of the Negotiable Instruments Act, 1881 was sustainable where the cheque was admitted, the accused raised a defence of absence of money-lending licence, and the debt was alleged to be time-barred.

Analysis: The cheque and signature were admitted, attracting the statutory presumption under Section 139. The Court held that in a prosecution under Section 138, absence of a money-lending licence does not defeat the complaint. It further held that a cheque issued towards a time-barred debt can still support liability, and once issuance of the cheque in relation to a debt is proved, the defence of no enforceable debt is not available in the manner urged. The trial court's view that the complainant could not succeed for want of licence and because the debt was stale was therefore erroneous.

Conclusion: The acquittal was set aside and the accused was convicted under Section 138 of the Negotiable Instruments Act, 1881.

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