Statutory presumptions under the Negotiable Instruments Act sustained conviction, while sentence was modified to substitute fine.

Once issuance of the cheque and the accused's signature were proved, statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act operated in favour of the complainant. The defence failed to rebut them on a preponderance of probabilities, as the documents relied on were found self-serving and the alleged account book was not shown to be kept in the regular course of business. The conviction under Section 138 was therefore upheld. On sentence, the custodial component was modified and fine was substituted, while compensation to the complainant was maintained. The revision succeeded only to the limited extent of sentence modification.

---

---

Issues: (i) Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 was sustainable in view of the defence version and the evidence adduced to rebut the statutory presumptions; (ii) whether the sentence required modification.

Issue (i): Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 was sustainable in view of the defence version and the evidence adduced to rebut the statutory presumptions.

Analysis: The cheque issuance and the signature of the accused were accepted, and the dishonour was for stop payment. Once execution of the cheque was proved, the presumptions under Sections 118 and 139 of the Negotiable Instruments Act, 1881 operated in favour of the complainant. The defence documents were found to be self-serving and unreliable, and the alleged account book was not shown to be maintained in the regular course of business. The accused failed to prove, on a preponderance of probabilities, that the cheque was not issued towards a legally enforceable debt or that the liability had been discharged.

Conclusion: The conviction under Section 138 of the Negotiable Instruments Act, 1881 was upheld.

Issue (ii): Whether the sentence required modification.

Analysis: The sentence of simple imprisonment with compensation was reconsidered in the light of the governing sentencing approach in cheque dishonour cases. The Court modified the custodial component and substituted a fine, while preserving payment of the cheque amount to the complainant as compensation.

Conclusion: The sentence was modified by substituting fine of Rs. 1,00,000/- in default simple imprisonment for three months.

Final Conclusion: The revision succeeded only to the limited extent of sentence modification, while the finding of guilt under Section 138 of the Negotiable Instruments Act, 1881 remained intact.

Ratio Decidendi: Once issuance of the cheque and signature are proved, the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act, 1881 arise, and the accused must rebut them by credible evidence showing that the cheque was not issued towards a legally enforceable debt.

---