Cheque dishonour presumption survives unless rebutted by probable evidence; firm liability can extend to a non-signatory partner.

In a cheque dishonour prosecution, admission of the cheque signature keeps the statutory presumption under Section 139 alive unless the accused rebuts it with a probable defence supported by cogent material; inconsistent explanations and unsupported allegations of coercion or repayment are insufficient. Where a cheque is issued by an authorised partner on behalf of a partnership firm, the non-signatory partner cannot avoid liability merely because he did not sign the instrument. Defects in the return memo, non-service of notice, or limitation do not defeat the complaint when dishonour is otherwise proved, notice is duly dispatched, and the complaint is filed within time. The discussion affirms firm liability and the evidentiary burden in Section 138 cases.

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Issues: (i) whether the accused had rebutted the statutory presumption arising from issuance of the cheque and established absence of a legally enforceable liability; (ii) whether a partner who was not the signatory of the cheque could escape liability where the cheque was issued on behalf of the partnership firm; (iii) whether the plea of defective return memo, non-service of legal notice and limitation defeated the complaint under Section 138 of the Negotiable Instruments Act, 1881.

Issue (i): whether the accused had rebutted the statutory presumption arising from issuance of the cheque and established absence of a legally enforceable liability.

Analysis: The cheque signatures were admitted. The defence taken at different stages was inconsistent, ranging from coercion and blank cheque misuse to a plea that only part-payment had been made and the balance was not due. No cogent material was produced to support the alleged repayment or the alleged coercion. The Court applied the principle that the accused in a cheque dishonour prosecution must rebut the presumption on the basis of preponderance of probabilities and that such rebuttal may be drawn from the record only if the defence is probable. On the facts, the complainant's version that the tour cost was paid and the cheque represented refund liability remained intact, and the presumption under Section 139 was not displaced.

Conclusion: The presumption was not rebutted and the cheque was held to have been issued in discharge of a legally enforceable liability.

Issue (ii): whether a partner who was not the signatory of the cheque could escape liability where the cheque was issued on behalf of the partnership firm.

Analysis: The cheque was issued by one partner for and on behalf of the firm. The liability was that of the firm, and both accused were admittedly partners. In that setting, the non-signatory partner could not avoid responsibility merely by asserting absence of signatures. The Court treated the cheque as binding on the firm and all its partners because it was issued in the course of firm liability through an authorised partner.

Conclusion: The non-signatory partner remained liable and could not avoid conviction on the ground that he had not signed the cheque.

Issue (iii): whether the plea of defective return memo, non-service of legal notice and limitation defeated the complaint under Section 138 of the Negotiable Instruments Act, 1881.

Analysis: The record contained the cheque deposit slip, the bank rejection memo bearing the bank stamp, and the legal notice sent to the last known address. The memo was not ideal in form, but the surrounding evidence established the dishonour. The notice was shown to have been dispatched, and even otherwise the accused received summons in the complaint and still did not tender payment. The complaint was filed within one month of dispatch of notice and no material showed it to be time-barred.

Conclusion: The objections on dishonour proof, notice and limitation failed.

Final Conclusion: The conviction under Section 138 of the Negotiable Instruments Act, 1881 and the modified compensation order were upheld, and the revision was rejected.

Ratio Decidendi: In a cheque dishonour case, once signature on the cheque is admitted and the cheque is issued for and on behalf of a partnership firm, the statutory presumption of legally enforceable liability continues unless rebutted by a probable defence supported by cogent material; absence of signature by one partner does not by itself defeat firm liability, and duly dispatched notice with proved dishonour is sufficient for prosecution under Section 138.

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