Case Name : Kishan Rao vs Shankar Gouda Case Reference: (2018) 8 SCC 165 Case Number: Crl A No 803/2018 : (2018) 5 SCR 69 Court: Supreme Court Bench: 02 Coram: AK Sikri, Ashok Bhushan (Author) Date: 02.07.2018
Mere denial of a debt or liability cannot shift the burden of proof from the accused in a case of dishonour of cheque. (Para 19)
When the accused raises a probable defence which creates doubt with regard to the existence of a debt or liability, the presumption may fail (Para 21)
Refer also: State of Kerala vs Puttumana Illath Jathavedan Namboodiri, (1999) 2 SCC 452 Sanjaysinh Ramrao Chavan vs Dattatray Gulabrao Phalke, (2015) 3 SCC 123 In exercise of revisional jurisdiction, the court can interfere only when the order is perverse, wholly unreasonable, or there is non-consideration of any relevant material. Kumar Exports vs Sharma Carpets. (2009) 2 SCC 513 Presumptions are devices by use of which courts are enabled and entitled to pronounce on an issue notwithstanding that there is no evidence or insufficient evidence. All presumptions come under one of three classes: 1. “May presume” - Rebuttable 2. “Shall presume” - Rebuttable 3. “Conclusive presumptions” - Irrebuttable The term “presumption” is used to designate an inference affirmative or dis-affirmative of the existence of a fact; this presumed fact is drawn by a judicial tribunal by a process of probable reasoning from some matter of fact either judicially noticed, admitted, or established by legal evidence. Presumption means taking as true without examination or proof Applying the definition of ‘proved’ in Evidence - Section 3, as soon as the complainant discharges the burden to prove that the instrument was executed by the accused, the rules of presumptions under NI Act - Section 118 and NI Act - Section 139 shift the burden on the accused. These presumptions live, exist and survive and end only when the contrary is proved by the accused. That the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence but only makes a prima facie case for a party for whose benefit it exists The presumptions under NI Act - Section 118 and NI Act - Section 139 are rebuttable (Evidence, Section 4) The accused may adduce evidence to rebut the presumption but mere denial regarding existence of debt will not serve any purpose; but the accused need not disprove the non-existence of consideration and debt by leading evidence because the existence of negative evidence is neither possible nor contemplated. The court, upon consideration of facts and circumstances brought on record by the accused may either believe that the consideration and debt did not exist or that their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist Rangappa vs Sri Mohan, (2010) 11 SCC 441 {03 Judge Bench} When the accused raises a probable defence which creates doubt with regard to the existence of a debt or liability, the presumption may fail. The rebuttable presumption under NI Act - Section 139 is a device to prevent undue delay in the course of litigation. The offence punishable under NI Act - Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. The defendant-accused cannot be expected to discharge an unduly high standard of proof.
See also: NI Act - Section 138 CrPC - Section 397 CrPC, Section 401 Evidence - Section 3 Evidence, Section 4