Cheque presumption under the Negotiable Instruments Act stands unless a probable defence rebuts it on preponderance of probabilities.

Admission of cheque execution triggered the rebuttable presumption under Section 139 of the Negotiable Instruments Act, and the accused failed to displace it because the claimed security-cheque defence was unsupported by contemporaneous protest, complaint, or stop-payment instructions. The appellate court's acquittal was also found unsustainable because it relied on the absence of a loan document and income-tax returns without adequately addressing the complainant's explanation of funds from land acquisition compensation and bank withdrawals. The conviction was therefore not permitted to stand as reversed on that reasoning, and the matter was remitted for fresh appellate consideration.

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Issues: (i) Whether the accused had rebutted the statutory presumption arising on admitted execution of the cheque under Section 139 of the Negotiable Instruments Act, 1881; (ii) Whether the appellate court was justified in acquitting the respondent by doubting the loan transaction and the source of funds of the complainant.

Issue (i): Whether the accused had rebutted the statutory presumption arising on admitted execution of the cheque under Section 139 of the Negotiable Instruments Act, 1881.

Analysis: Once the signatures on the cheque were admitted, the statutory presumption under Section 139 operated in favour of the complainant. The burden on the accused was only to raise a probable defence on the standard of preponderance of probabilities. The defence that the cheque was given as security for an earlier loan was found unsubstantiated, as no protest, complaint, stop-payment instruction, or other contemporaneous step had been taken to support the plea.

Conclusion: The accused failed to rebut the presumption under Section 139 of the Negotiable Instruments Act, 1881.

Issue (ii): Whether the appellate court was justified in acquitting the respondent by doubting the loan transaction and the source of funds of the complainant.

Analysis: The appellate court had relied on the absence of a loan document and on the complainant not producing income-tax returns, but the record showed that the complainant had explained the source of funds as compensation received from land acquisition and had referred to withdrawals from bank accounts. The appellate court did not adequately meet the findings of the trial court and set aside the conviction without sufficient reasoning.

Conclusion: The acquittal was not sustainable and was set aside.

Final Conclusion: The revision succeeded to the extent that the acquittal was reversed and the matter was sent back for fresh consideration by the appellate court.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, admission of cheque execution triggers a rebuttable presumption under Section 139, which can be displaced only by a probable defence proved on a preponderance of probabilities; an acquittal cannot stand where the appellate court overturns a conviction without adequately addressing the trial court's findings.

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