Rebuttable presumption in cheque dishonour cases fails when the underlying debt is not proved by reliable evidence.

In a Section 138 prosecution, the cheque-holder's presumptions under Sections 118A and 139 remain rebuttable, but the complainant must still prove a legally enforceable liability. The court treated the loan memorandum as unreliable because of irregular form, missing concluding signature, overwriting in the date, and doubts about its genuineness and execution. As the alleged loan transaction was not proved in a clear and unambiguous manner, the accused rebutted the presumption on a preponderance of probabilities without leading defence evidence, and the acquittal was upheld as a reasonably possible view.

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Issues: Whether the complainant established the existence of a legally enforceable debt and, if so, whether the accused rebutted the statutory presumption arising under the cheque dishonour law.

Analysis: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, the complainant receives the statutory presumptions under Sections 118A and 139, but the foundational requirement remains proof of a legally enforceable liability. The written memorandum relied upon as the basis of the loan was found to contain material irregularities, including discrepancies in the form of the document, absence of a signature at the conclusion of the recitals, overwriting in the date, and circumstances creating doubt about its genuineness and execution. The evidence also did not clearly establish the alleged loan transaction in a plain, clear, and unambiguous manner. On that basis, the presumption stood rebutted on the standard of preponderance of probabilities, and the acquittal already recorded by the trial court was found to be a reasonably possible view.

Conclusion: The complainant failed to prove the legally enforceable debt, the accused successfully rebutted the statutory presumption, and the acquittal was upheld.

Ratio Decidendi: In a Section 138 prosecution, the presumption in favour of the cheque holder is rebuttable, and where the material relied upon to prove the debt is doubtful or lacks reliable proof of execution, the accused may rebut the presumption on a preponderance of probabilities without leading defence evidence.

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