Cheque presumptions under the Negotiable Instruments Act remain unless rebutted by a probable defence, even when security cheque is pleaded.

Once the cheque and signature are admitted, the statutory presumptions under Sections 118(a) and 139 of the Negotiable Instruments Act operate, and the accused must rebut them by a probable defence on a preponderance of probabilities. A contradictory plea that the cheque was only a security cheque, together with denial of liability and absence of receipts, was insufficient to displace the presumption. The cheque dishonour for insufficiency of funds and due service of the demand notice supported liability under Section 138. The sentence of simple imprisonment and compensation was also treated as consistent with the deterrent and compensatory object of the provision, with no exceptional ground for revisional interference.

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Issues: (i) Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 was liable to be set aside on the grounds that the cheque was issued as a security cheque, the complainant did not produce receipts, and the accused had rebutted the statutory presumption; (ii) whether the sentence of simple imprisonment for one year and compensation awarded were liable to interference in revision.

Issue (i): Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 was liable to be set aside on the grounds that the cheque was issued as a security cheque, the complainant did not produce receipts, and the accused had rebutted the statutory presumption.

Analysis: The cheque was admitted by the accused, including his signature, which attracted the presumptions under Sections 118(a) and 139 of the Negotiable Instruments Act, 1881. The accused was required to rebut those presumptions by raising a probable defence on the touchstone of preponderance of probabilities. His defence was found to be contradictory, as he alternately claimed that the cheque was issued as security for the apple transaction and as security for repayment of a loan. Mere denial, absence of goods receipts, or the plea of a security cheque did not dislodge the statutory presumption. The cheque was dishonoured for insufficiency of funds and the notice of demand was held duly served, with no payment made within the statutory period.

Conclusion: The conviction was upheld and the challenge to the finding of guilt failed.

Issue (ii): Whether the sentence of simple imprisonment for one year and compensation awarded were liable to interference in revision.

Analysis: The sentence was considered in the light of the deterrent and compensatory object of Section 138 of the Negotiable Instruments Act, 1881. The award of compensation, being linked to the cheque amount and the passage of time, was treated as justified. No exceptional circumstance was shown to warrant interference with the quantum of sentence or compensation in revisional jurisdiction.

Conclusion: No interference was called for with the sentence or compensation.

Final Conclusion: The revision was found to be without merit, and the conviction, sentence, and compensation order were left undisturbed.

Ratio Decidendi: Once execution of the cheque and signature are admitted, the statutory presumptions under Sections 118(a) and 139 operate, and the accused can escape liability only by proving a probable defence on preponderance of probabilities; a bare or contradictory defence, including one based on a security cheque, is insufficient to rebut the presumption.

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