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2022 (2) TMI 132 - HC - Indian LawsDishonor of Cheque - insufficiency of funds - rebuttal of presumption under Sections 118 and 139 of the NI Act - HELD THAT:- The material available on record shows that the case of the appellant before the Magistrate was that since he was having friendly relations with the respondent no. 1, he had advanced certain amounts to the said respondent on different dates, totaling to an amount of 6 lakhs. It was claimed ₹ that the respondent no. 1 failed to repay the said amounts, despite several visits and eventually, the subject cheques were issued in favour of the appellant - The statutory scheme of the aforesaid Act is that presumption operates in favour of the complainant under Sections 118 and 139 of the said Act. As long as the signature on the cheque is not denied, it is presumed that the cheque has been issued in discharge of legal debt or liability and the onus is on the accused to demonstrate why the presumption ought not to operate against him. There cannot be any doubt about the proposition that the presumption can be rebutted by the accused. It can be rebutted by the accused by leading defence evidence or by discrediting the claims made by the complainant by effective cross examination or confronting the complainant with certain documents. Another aspect of the matter is that the presumption would operate when foundational facts are established by the complainant. One of the relevant facts in this regard is the material, which is required to be placed on record by the complainant as regards the details of when and the manner in which the amounts were advanced to the accused and the source of such amounts supported by cogent material on record. The failure of the appellant in showing the said amounts in the Income Tax Returns is also a relevant factor, which the Sessions Court took into consideration while reversing the conviction and sentence - it is found that the Magistrate had erred in proceeding to convict and sentence the respondent no. 1 under Section 138 of the aforesaid Act and that the Sessions Court was justified in interfering with the same. Appeal dismissed.
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