High Court of Karnataka Upholds Conviction in Cheque Bounce Case — Accused Failed to Rebut Presumption Under Section 139 of NI Act. The court confirmed that the accused's defence of a blank cheque was not credible and that the complainant had proved the existence of a legally enforceable debt.

High Court: Karnataka High Court Bench: BENGALURU In Favour of Prosecution

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2026-05-18 17:33:06

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Case Note & Summary

The case involves a criminal revision petition filed by the accused, C. Niranjan Yadav, challenging his conviction under Section 138 of the Negotiable Instruments Act, 1881, for dishonour of a cheque. The complainant, D. Ravi Kumar, alleged that the accused borrowed Rs.65,000 from him and issued a cheque bearing No.9 towards repayment. The cheque was presented and dishonoured with the endorsement 'funds insufficient'. After issuing a legal notice, the complainant filed a complaint under Section 200 of the Code of Criminal Procedure, 1908. The trial court convicted the accused and sentenced him to pay a fine of Rs.1,00,000, with Rs.65,000 to be paid as compensation to the complainant. The appeal before the I Additional Sessions Judge, Shivamogga, was dismissed, confirming the conviction. The accused then filed this revision petition. The main legal issue was whether the presumption under Section 139 of the NI Act was rebutted by the accused. The accused argued that the cheque was given as a blank security and not towards any debt. The court noted that the accused did not enter the witness box or lead any evidence to support his defence. The complainant's evidence, including the cheque, dishonour memo, and legal notice, remained unchallenged. The court held that the presumption under Section 139 operates in favour of the complainant, and the accused failed to rebut it. The concurrent findings of the courts below were found to be based on proper appreciation of evidence. The revision petition was dismissed, and the conviction and sentence were upheld. The court directed the accused to pay the fine amount within four weeks, failing which the trial court would take steps to enforce the sentence.

Headnote

A) Negotiable Instruments Act - Dishonour of Cheque - Section 138 - Legally Enforceable Debt - The complainant alleged that the accused borrowed Rs.65,000 and issued a cheque for repayment, which was dishonoured. The accused contended that the cheque was given as a blank security. The court held that the presumption under Section 139 of the Act operates in favour of the complainant, and the accused failed to rebut it by raising a probable defence. The concurrent findings of the courts below were upheld. (Paras 2-6)

B) Negotiable Instruments Act - Presumption under Section 139 - Rebuttal - The accused must adduce evidence to rebut the presumption that the cheque was issued for a legally enforceable debt. Mere denial or assertion of a blank cheque is insufficient. The court found that the accused did not lead any evidence to support his defence, and the complainant's evidence remained unchallenged. (Paras 4-6)

Issue of Consideration

Whether the conviction of the accused under Section 138 of the Negotiable Instruments Act, 1881, was sustainable in law, particularly in light of the accused's defence that the cheque was given as a blank cheque and not towards any legally enforceable debt.

Final Decision

The revision petition is dismissed. The conviction and sentence passed by the trial court and confirmed by the appellate court are upheld. The accused is directed to pay the fine amount within four weeks, failing which the trial court shall take steps to enforce the sentence.

Law Points

Presumption under Section 139 of Negotiable Instruments Act
1881
Rebuttal of presumption
Legally enforceable debt
Blank cheque defence
Standard of proof in summary trial

Case Details

NC: 2024:KHC:22939

CRL.RP No. 814 of 2021

2024-06-24

V Srishananda

NC: 2024:KHC:22939

Sateesh Chandra K. V. for petitioner, G. Lakshmeesh Rao for respondent

C. Niranjan Yadav

D. Ravi Kumar

Nature of Litigation

Criminal revision petition against conviction under Section 138 of the Negotiable Instruments Act, 1881

Remedy Sought

The petitioner (accused) sought to set aside the conviction and sentence passed by the trial court and confirmed by the appellate court.

Filing Reason

The accused was convicted for dishonour of a cheque issued towards repayment of a loan of Rs.65,000.

Previous Decisions

The trial court (J.M.F.C-III, Shivamogga) convicted the accused in C.C. No.17 of 2016 on 14.05.2019, and the appellate court (I Additional Sessions Judge, Shivamogga) dismissed the appeal in Crl.A. No.131 of 2019 on 12.03.2021.

Issues

Whether the conviction under Section 138 of the Negotiable Instruments Act, 1881 is sustainable when the accused claims the cheque was given as a blank security. Whether the presumption under Section 139 of the NI Act was rebutted by the accused.

Submissions/Arguments

The petitioner argued that the cheque was given as a blank security and not towards any legally enforceable debt, and that the complainant failed to prove the existence of a debt. The respondent argued that the presumption under Section 139 of the NI Act operates in favour of the complainant, and the accused failed to rebut it by leading evidence.

Ratio Decidendi

The presumption under Section 139 of the Negotiable Instruments Act, 1881, that a cheque was issued for a legally enforceable debt, operates in favour of the complainant. The accused must adduce evidence to rebut this presumption. Mere denial or assertion of a blank cheque is insufficient. In this case, the accused did not enter the witness box or lead any evidence, and the complainant's evidence remained unchallenged. Therefore, the conviction was upheld.

Judgment Excerpts

The accused who suffered an order of conviction under Section 138 of the Negotiable Instruments Act, 1881 in Criminal Case No.17 of 2016 confirmed in Criminal Appeal No.131 of 2019 has preferred this revision petition. The facts in brief which are utmost necessary for disposal of this revision petition are as under: A complaint came to be filed under Section 200 of the Code of Criminal Procedure, 1908 alleging the commission of offence under Section 138 of the Act by contending that the accused sought financial assistance from the complainant in a sum of Rs.65,000/- and towards repayment of the same, a cheque bearing No.9...

Procedural History

The complainant filed a complaint under Section 200 Cr.P.C. in C.C. No.17 of 2016 before the J.M.F.C-III, Shivamogga, which convicted the accused on 14.05.2019. The accused appealed in Crl.A. No.131 of 2019 before the I Additional Sessions Judge, Shivamogga, which dismissed the appeal on 12.03.2021. The accused then filed this criminal revision petition under Sections 397 and 401 Cr.P.C. before the High Court of Karnataka.