Rebuttable cheque presumption under the Negotiable Instruments Act can be displaced by probable defence and doubtful debt capacity.

In Section 138 prosecutions, the statutory presumptions under Sections 118 and 139 arise on admitted cheque issuance, but they remain rebuttable through cross-examination, surrounding circumstances, or independent evidence. The text explains that a probable defence can be made out by challenging the complainant's financial capacity and the existence of a legally enforceable debt. Doubt over an alleged cash loan, lack of written documentation, inconsistencies in the claimed withdrawal and advance, and a defence of misuse of blank signed cheques were treated as sufficient to shake the debt claim and require cogent proof of liability from the complainant.

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Issues: Whether leave to appeal against the acquittal recorded in a prosecution under Section 138 of the Negotiable Instruments Act, 1881 should be granted when the accused has raised a probable defence by challenging the complainant's financial capacity and the existence of a legally enforceable debt.

Analysis: The statutory presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881 operates once issuance of the cheque is admitted, but it remains rebuttable. The accused may displace the presumption not only by independent evidence but also through the complainant's cross-examination and surrounding circumstances. Here, the complainant's case of advancing a large cash loan was found doubtful because there was no written loan document, there were inconsistencies in the amount allegedly withdrawn and advanced, the complainant's income did not support the asserted lending capacity, and the defence of misuse of blank signed cheques was specifically raised in the reply notice and cross-examination. On this material, the defence was held to be probable and sufficient to shake the complainant's claim of a legally enforceable debt.

Conclusion: Leave to appeal was rightly refused because no error was shown in the acquittal, and the presumption under Section 139 stood rebutted on the facts.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, the accused can rebut the statutory presumption by establishing a probable defence through cross-examination and surrounding circumstances, including by showing doubt about the complainant's capacity and the existence of the debt; the complainant must then prove the liability on cogent material.

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