The Tax Publishers 2018 TaxPub(CL) 0937 (SC)

 

Kishan Rao v. Shankargouda

 

NEGOTIABLE INSTRUMENTS ACT, 1881

--Dishonour of cheque for insufficiency, etc., of funds in account --Appeal against order of High Court regarding set aside of conviction order against drawerIssue of creating doubt by drawer with regard to existence of debt or liability--No evidence led by drawer to rebut presumption under section 139 regarding existence of debt or liability--When drawer failed to file any evidence, which proved that his cheque was stolen and no evidence was led by the drawer to rebut presumption under section 139 regarding existence of debt or liability of the borrower, then, High Court could not pass order setting aside conviction order under section 138 against the drawer.--Drawer obtained loan from payee. Therefore, the drawer issued cheques to the payee in respect of repayment of the loan, but the cheque were dishonoured for insufficient funds. Payee filed complaint under section 138 against the drawer. Drawer raised objection that the cheque were stolen. Trial Court rejected the defence of the drawer on the ground that the drawer failed to rebut presumptions under section 139 by leading any evidence of his behalf. Therefore, the Trial Court convicted the drawer under section 138, which was affirmed by Appellate Court. Drawer filed petition before High Court against the order. The High Court passed order setting aside the conviction order on the ground that the drawer had been successful in creating doubt with regard to existence of debt or liability. Payee filed an appeal before Supreme Court on the ground that the drawer failed to rebut the presumption under section 139 by leading evidence. Therefore, there was no ground for setting aside the conviction order. Held: Payee had led oral as well as documentary evidence on record, which proved that the cheque was issued by the drawer, which contained his signatures. Further that, Bank official was produced as one of the witnesses who proved that the cheque was not returned on the ground that it did not contain signatures of the drawer rather it was returned due to insufficient funds. Drawer had not filed any evidence, which proved that the cheque was stolen. Further that, no evidence was led by the drawer to rebut the presumption under section 139 regarding existence of debt or liability of the drawer. The High Court had committed error in setting aside the order of conviction, as there was no sufficient ground for setting aside the conviction order. Hence, the judgment of the High Court was set aside and judgment of the Trial Court as affirmed by the Appellate Court was restored.

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