Cheque dishonour conviction upheld on statutory presumptions, but appellate enhancement of default sentence was set aside.

Cheque dishonour under Section 138 was sustained where the cheques and signatures were admitted and the statutory presumptions under Sections 118 and 139 operated in favour of the complainant. The accused failed to rebut the presumption with reliable material showing that liability had been wholly shifted to a third party or that the cheques were only security instruments without enforceable debt. Pendency of civil proceedings or a company petition did not bar the criminal prosecution, and revisional review could not disturb concurrent factual findings absent perversity. However, the First Appellate Court could not enhance the default sentence in an appeal filed only by the accused, so that enhancement was set aside and the trial sentence restored.

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Issues: (i) Whether the cheques issued by the accused were supported by a legally enforceable debt so as to sustain conviction under Section 138 of the Negotiable Instruments Act, 1881; (ii) Whether the First Appellate Court could enhance the default sentence in an appeal filed only by the accused.

Issue (i): Whether the cheques issued by the accused were supported by a legally enforceable debt so as to sustain conviction under Section 138 of the Negotiable Instruments Act, 1881.

Analysis: The cheques were admitted, the signatures were admitted, and the statutory presumptions under Sections 118 and 139 of the Negotiable Instruments Act, 1881 arose in favour of the complainant. The accused relied on an escrow arrangement, third-party dealings, and the plea that the cheques were only security cheques, but the Court found no reliable material to show that the entire liability stood shifted to the third party or that the cheques ceased to represent an enforceable liability. The Court also held that pendency of civil proceedings or a separate company petition did not bar criminal prosecution, and that the revisional jurisdiction did not permit reappreciation of concurrent factual findings absent perversity.

Conclusion: The conviction under Section 138 of the Negotiable Instruments Act, 1881 was upheld and the challenge to the finding of guilt failed.

Issue (ii): Whether the First Appellate Court could enhance the default sentence in an appeal filed only by the accused.

Analysis: The appeal before the First Appellate Court was filed by the accused, and the complainant had not challenged the sentence. In such a situation, the appellate court had no authority to enhance the punishment on its own motion. The enhancement of the default sentence was therefore unsustainable, while the substantive conviction and the trial court's sentence could otherwise stand.

Conclusion: The enhancement of the default sentence was set aside and the sentence imposed by the Trial Magistrate was restored.

Final Conclusion: The revision succeeded only to the extent of deleting the appellate enhancement of sentence, while the conviction and the original sentence were maintained.

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