Cheque dishonour complaints cannot be quashed at the threshold where statutory presumptions and disputed settlement issues require trial.

In a Section 138 prosecution, a complaint disclosing issuance and dishonour of the cheque, statutory notice, and non-payment satisfies the basic ingredients of the offence. At the threshold, the statutory presumptions under Sections 118 and 139 operate in favour of the complainant, and the accused must rebut them by a probable defence on a preponderance of probabilities. Disputed questions about a civil consent decree, memorandum of understanding, or whether the cheque transaction was covered by them could not be decided in quashing proceedings, and the absence of supporting proof at the summoning stage was insufficient to defeat the complaint.

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Issues: Whether a complaint under Section 138 of the Negotiable Instruments Act, 1881 could be quashed in exercise of inherent jurisdiction at the threshold on the grounds of disputed facts, alleged settlement in civil proceedings, and absence of supporting proof of liability.

Analysis: The complaint disclosed issuance of the cheque, dishonour, statutory notice and non-payment, thereby satisfying the basic ingredients of the offence. At the stage of issuance of process, the statutory presumption under Sections 118 and 139 of the Negotiable Instruments Act, 1881 operates in favour of the complainant, and the accused can rebut it only by raising a probable defence on the standard of preponderance of probabilities. The Court held that the effect of the consent decree and memorandum of understanding, and the question whether the cheque-related transaction was covered by them, involved disputed questions of fact that could not be conclusively decided in quashing proceedings. The absence of supporting evidence at the summoning stage was held to be insufficient to displace the statutory presumption, and the complaint could not be rejected on that basis.

Conclusion: The petition for quashing was not maintainable on the facts at the pre-trial stage, and the complaint was allowed to proceed.

Final Conclusion: Interference under Section 482 of the Code of Criminal Procedure, 1973 was declined because the matter required trial and evidence, not summary adjudication.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881, where issuance and dishonour of the cheque are prima facie disclosed, the statutory presumption of a legally enforceable liability cannot be displaced in quashing proceedings merely by raising disputed factual defences or relying on civil settlement material requiring evidence.

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