Accused Must Raise Probable Defence To Rebut Statutory Presumption Under Section 139 NI Act If Signatures Are Undisputed: Himachal Pradesh High Court

"Needless to say, if the accused/drawer of the cheque in question neither raises a probable defence nor is able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into play." Himachal Pradesh High Court, in a significant ruling, held that the statutory presumption under Section 139 of the Negotiable Instruments Act (NI Act) remains intact if the accused fails to raise a "probable defence" after admitting to the signatures on the cheque.

A single-judge bench of Justice Sandeep Sharma observed that once the factum of issuance and the signatures are undisputed, the burden shifts to the accused to prove the non-existence of a legally enforceable debt through a preponderance of probabilities.

The petitioner, Budhi Singh, challenged the concurrent findings of the Judicial Magistrate First Class, Chachiot and the Sessions Judge, Mandi, which convicted him under Section 138 of the NI Act. The complainant alleged that the accused borrowed Rs. 3,00,000 for domestic needs and issued a cheque that was returned with the remarks “Exceeds arrangement.” The trial court sentenced the petitioner to three months of simple imprisonment and ordered compensation of Rs. 4,00,000.

The primary question before the court was whether the petitioner had successfully rebutted the statutory presumptions under Sections 118 and 139 of the NI Act. The court was also called upon to determine the scope of its revisional jurisdiction under Section 397 of the CrPC in the face of concurrent findings of fact by the lower courts.

Statutory Presumption and Reverse Onus

The Court emphasized that Section 139 of the NI Act serves as an example of a "reverse onus clause" designed to improve the credibility of negotiable instruments. It noted that while the offence is regulatory in nature, the law mandates a presumption that the cheque was issued for a valid consideration unless the contrary is proved.

The bench relied on the landmark Supreme Court decision in Rangappa vs. Sri Mohan, noting that the standard of proof for the accused to rebut this presumption is "preponderance of probabilities." The Court observed that if the drawer cannot contest the existence of a legally enforceable debt, the statutory presumption regarding the commission of the offence comes into full play.

“Section 139 is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments.”

Failure to Lead Evidence in Defence

Upon perusing the record, the Court found that the petitioner never disputed the issuance of the cheque or his signatures. Although the accused suggested during cross-examination that a cheque issued in 2018 was misused by the complainant, he failed to lead any cogent evidence to probablize this version.

Justice Sharma noted that the accused’s statement under Section 313 CrPC, which denied the complainant’s case in toto, was insufficient without supporting material. The Court found that the petitioner had been granted multiple opportunities to comply with orders for depositing compensation during the pendency of the revision, which he failed to do, further weakening his stance.

“Though accused attempted to set up a case that cheque issued in the year 2018 was misused by the complainant, but such defence of him never came to be probablized by leading cogent and convincing evidence.”

Limited Scope of Revisional Jurisdiction

The High Court clarified that its jurisdiction under Section 397 of the CrPC is supervisory and cannot be equated with that of an appellate court. Citing the Apex Court’s ruling in State of Kerala Vs. Puttumana Illath Jathavedan Namboodiri, the bench held that it would not ordinarily re-appreciate evidence unless there is a "glaring feature" pointing toward a gross miscarriage of justice.

The Court concluded that the lower courts had meticulously dealt with every aspect of the matter. Since the petitioner's counsel failed to point out any material irregularity in the appreciation of evidence, the High Court found no reason to interfere with the well-reasoned judgments of the trial and appellate courts.

“In its revisional jurisdiction, the High Court can call for and examine the record... for the purpose of satisfying itself as to the correctness, legality or propriety of any finding... But the said revisional power cannot be equated with the power of an appellate court.”

The High Court dismissed the criminal revision petition, affirming the conviction and sentence awarded by the trial court. The petitioner was directed to surrender before the trial court within one month to serve his sentence. The Court also ordered the cancellation of any bail bonds furnished by the accused.

Date of Decision: July 02, 2026