Section 138 cheque prosecution fails where Section 139 presumption is rebutted and enforceable debt remains unproved.

In a prosecution under Section 138 of the Negotiable Instruments Act, the cheque was treated as unlikely to have been issued for the alleged later loan because the cheque number and cheque-book entries supported the defence that it was only security for an earlier transaction. The accused rebutted the Section 139 presumption by pointing to the earlier liability, its claimed discharge, and supporting documents, after which the complainant had to prove a legally enforceable debt and failed to do so. The trial court's reliance on admitted signatures under Section 73 of the Evidence Act was found sustainable, and the acquittal was upheld.

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Issues: Whether the acquittal in a prosecution under Section 138 of the Negotiable Instruments Act called for interference, in the light of the statutory presumption under Section 139 and the defence that the cheque was issued as security for an earlier transaction.

Analysis: The cheque number and the surrounding cheque-book entries showed that the cheque in question was unlikely to have been issued in discharge of the alleged 2000 loan. The earlier transaction between the parties in 1995, the alleged discharge of that liability, and the documentary materials relied on by the defence made the complainant's version of a subsequent cash loan improbable. Once the accused rebutted the presumption under Section 139, the burden shifted back to the complainant to prove the existence of a legally enforceable debt, which was not done. The trial court's appreciation of evidence, including the use of admitted signatures under Section 73 of the Indian Evidence Act, was found to be sustainable.

Conclusion: The acquittal was justified and no interference was warranted; the complaint under Section 138 failed.

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