Cheque dishonour defence based on security cheque and prior payment must be tested at trial, not rejected at threshold.

A plea that a cheque was issued only as security, or that the underlying liability had already been discharged, does not justify discharge or closure at the threshold in a cheque dishonour prosecution. The accused's defence requires evidentiary examination and rebuttal of the statutory presumption under the Negotiable Instruments Act. Accordingly, a complaint under Section 138, and the connected cheating charge, may proceed to trial where liability and payment can be proved on evidence rather than decided summarily at the discharge stage.

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Issues: Whether an accused in a cheque dishonour prosecution could obtain discharge or closure at the threshold on the plea that the cheque was issued as security and that the alleged liability had already been paid.

Analysis: The complaint disclosed issuance of a cheque, its dishonour, and a prosecution under Section 138 of the Negotiable Instruments Act, 1881, along with a charge under Section 420 of the Indian Penal Code, 1860. The defence raised by the accused, namely that the cheque was a security cheque and that payment had already been made, required evidentiary evaluation. The Court applied the principle that such a defence cannot be finally accepted at the stage of discharge or closure in a summons trial, and that the matter must proceed to trial for proof of liability and rebuttal of the statutory presumption.

Conclusion: The application for discharge or closure was not maintainable at that stage, and the complaint under Section 138 of the Negotiable Instruments Act, 1881 was allowed to proceed.

Final Conclusion: Threshold interference was declined because the defence set up by the accused was a matter for trial and not for summary rejection of the prosecution.

Ratio Decidendi: In a prosecution for dishonour of cheque, a plea that the cheque was issued as security or that the underlying liability stands discharged is ordinarily a matter of defence to be established at trial and does not justify discharge at the threshold.

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