(A) Negotiable Instruments Act, 1881 Sections–139–Presumption of Legality–Reverse Onus & Standard of Proof–
Section 139 imposes a reverse onus on the accused, meaning that once the foundational facts of issuance and dishonour of the cheque are established, the presumption of a legally enforceable debt follows. (Para 8)
(B) Negotiable Instruments Act, 1881–Sections 138,118&139–Dishonour of Cheque–Statutory Presumption–Rebuttal of Presumption– Accused’s Burden of Proof–Trial Court’s error in computation of Liability–Accused claimed that the cheque was issued as security for a loan of Rs. 3,00,000 and was misused by the complainant by filling a higher amount–The Trial Court held that the liability of the accused on the date of cheque issuance was Rs.9,82,700 instead of Rs. 10,00,000 and, therefore, Section 138 NI Act was not attracted–Held–That, the complainant's claim of advancing Rs. 10,00,000 was duly supported by a written agreement–The trial court's failure to properly consider this presumption, coupled with its erroneous approach in demanding additional proof of the complainant’s source of funds, was found to be inconsistent–Accused failed to rebut the presumption–Acquittal quashed–Accused convicted–Appeal allowed. (Paras 11,12,13,18 and 19)