Chhattisgarh High Court said that signing of cheque by that of the applicant indicates that he has admitted his liability. It also indicates that he has not rebutted the presumption of Sec 139 of Negotiable Instrument Act.

In the present case viz. Madan Tiwari v. Yashwant Kumar Sahu & Anr-

Complaint was filed by the respondent against the applicant, who was running an institution named Pleasant Health Welfare Foundation at Dongragaon. The Applicant had appointed 21 persons along with the Complainant on agreement. They deposited some amount as per the agreement and it was stated in the agreement that the amount so deposited would be refunded by the respondent after completion of the probation period which was of one year. The complainant and others even after the period of probation have not been regularised therefore, they demanded the refund of the amount of Rs.3,16,000/-from the applicant.

The cheque of amount of Rs.3,16,000/-in the favour of the complainant. The said cheque was dishonoured by the bank stating insufficient amount in the account of drawer. Hence opposite party (applicant) was served with legal notice dated 10.5.2004 and the applicant did not reply the same.

Therefore, the complainant further filed a complaint under Section 138 of Negotiable Instrument Act and the accused was further sentenced with Rigorous Imprisonment for two years and fine of 5000/- with default stipulation. he applicant filed criminal appeal before the appellate authority whereby the judgment of conviction and order of sentence was affirmed and filed revision before the Chhattisgarh High Court.

Bench of Justice Rajani Dubey dismissing the revision held that cheques undoubtedly represent the outstanding liability. That once the loan is disbursed and installments fall due on the date of the cheque as per the agreement, dishonour of such cheques would fall under Section 138 of the Negotiable Instrument Act 1881.

Hon’ble Court relied upon the judgment of Supreme Court in Rangapa V Shr Mohan, (2010) 11 SCC in which it was held that issuance of a cheque and signature thereon are admitted, presumption of a legally enforceable debt in favour of the holder of the cheque arises. It is for the accused to rebut the said presumption, though accused need not adduce his own evidence and can rely upon the material submitted by the complainant. However, mere statement of the accused may not be sufficient to rebut the said presumption.

The Court therefore dismissed the revision application on lack of merits and stated trial court as well as the Appellate Court having found that cheque contained the signatures of the accused/applicant and it was presented in the Bank of the presumption under Section 139 was rightly raised which was not rebutted by the accused. That both the trial court and the appellate court convicted the applicant under Section 138 of the Negotiable Instrument Act. The Trial Court and the Appellate Court arrived at the specific concurrent factual finding that the cheque had admittedly been signed by the applicant-accused.

Judgment/Order link-Madan Tiwari v. Yashwant Kumar Sahu & Anr

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