Rebuttal of Presumption and Acquittal for Cheque Dishonour under S.138 of NI Act, 1881
In an interesting case [Devender Kumar v. Khem Chand [2015] GCtR 6581 (Delhi)], it was held that under Section 139 of Negotiable Instruments Act, 1881, unless the contrary is proved, the holder of the cheque shall be presumed to have received the cheque in discharge of any debt or liability. Sub-clause (a) of Section 118 of the NI Act, inter-alia, provides that unless the contrary is proved, the drawn up negotiable instrument, if accepted, has to be presumed to be for consideration.
In this case there was successful rebuttal of the presumption under Section 139 of the NI Act of any legally enforceable debt and the accused was acquitted. It was held that an accused may not be expected to discharge an unduly high standard of proof. A reverse onus clause requires the accused to raise a probable defence for creating doubt about the existence of a legally enforceable debt or liability for thwarting the prosecution. The standard of proof for doing so would necessarily be on the basis of “preponderance of probabilities” and not “beyond shadow of any doubt”.
When at the commencement of, or in the course of a summary trial under the NI Act, it would appear to the Magistrate that the nature of the case is such that a sentence of imprisonment for a term exceeding one year may have to be passed or that it is for any reason, undesirable to try the case summarily, the Magistrate would, after hearing the parties, record an order to the effect and thereafter recall any witness who may be examined and proceeded to here or re-hear the case in the manner provided by the Code of Criminal Procedure, 1973.