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        Case ID :

        2022 (4) TMI 1349 - HC - Indian Laws

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        Rebuttable presumption in cheque dishonour cases requires probable defence, and acquittal stands absent perversity in trial findings. The statutory presumption under the Negotiable Instruments Act on admitted cheque execution is rebuttable, and the drawer may displace it by showing a ...
                        Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                            Rebuttable presumption in cheque dishonour cases requires probable defence, and acquittal stands absent perversity in trial findings.

                            The statutory presumption under the Negotiable Instruments Act on admitted cheque execution is rebuttable, and the drawer may displace it by showing a probable defence on the preponderance of probabilities, including through the complainant's own evidence and surrounding circumstances. In a cheque dishonour prosecution based on an alleged friendly loan, failure to prove the source of funds, lack of supporting documents, non-production of material witnesses, and related inconsistencies were treated as sufficient to rebut the presumption and to show absence of a legally enforceable debt. In appeal against acquittal, interference is justified only if the trial court's view is perverse or manifestly unreasonable. No such defect was shown, so the acquittal was maintained.




                            Issues: (i) whether the statutory presumption under the Negotiable Instruments Act stood rebutted on the facts proved by the complainant and the accused; and (ii) whether the acquittal recorded by the trial court called for interference in appeal.

                            Issue (i): whether the statutory presumption under the Negotiable Instruments Act stood rebutted on the facts proved by the complainant and the accused.

                            Analysis: The presumption arising on admitted execution of a cheque is rebuttable and does not cast an irrevocable burden on the drawer. The accused may rebut it by showing a probable defence on the touchstone of preponderance of probabilities, including by relying on the complainant's own evidence and surrounding circumstances. In a prosecution based on a cheque allegedly issued towards a friendly loan, the complainant's inability to prove the source of funds, the absence of supporting documentary proof, non-production of material witnesses, and other inconsistencies were treated as sufficient to dislodge the presumption and to shift the burden back to the complainant.

                            Conclusion: The presumption stood rebutted and the complainant failed to establish a legally enforceable debt or liability.

                            Issue (ii): whether the acquittal recorded by the trial court called for interference in appeal.

                            Analysis: In an appeal against acquittal, the appellate court must keep in view the strengthened presumption of innocence and interfere only where the findings are perverse, manifestly unreasonable, or based on ignoring relevant material. Where two reasonable views are possible, the view favouring acquittal ordinarily prevails. On the evidence, the trial court's appreciation was found to be plausible and supported by material deficiencies in the complainant's case; no perversity or miscarriage of justice was shown.

                            Conclusion: No interference with the acquittal was warranted.

                            Final Conclusion: The appeal failed and the acquittal of the respondent was left undisturbed.

                            Ratio Decidendi: In a cheque dishonour case, the statutory presumption of liability is rebuttable on a showing of probable defence on preponderance of probabilities, and an appellate court will not disturb an acquittal unless the trial court's view is perverse or unsustainable.


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                            ActsIncome Tax
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