A single bench of Justice Sophy Thomas of Kerala high Court has confirmed that the presumption outlined in Section 139 of the Negotiable Instruments Act (NI Act) – that a cheque was given to settle a debt or liability – is still valid even when it comes to voluntarily issued blank cheques.
“Even if a blank cheque leaf is voluntarily signed and handed over by the accused, towards some payment, it would attract the presumption under Section 139 of the N.I Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt”.
A revision was petition filed by a man who was convicted under Section 138 of the NI Act which deals with the offence of cheque bouncing.
The accused issued a cheque without ensuring that he had sufficient funds in his bank account after which the check bounced due to insufficient funds.
As per the petitioner, he issued a blank check to the financial institution of the complainant solely as collateral for a vehicle loan.
The High Court dismissed the claims of the petitioner, citing a lack of evidence from the petitioner demonstrating their acquisition of a vehicle loan from the financial institution associated with the complainant.
“The revision petitioner failed to adduce any cogent evidence to show that, the cheque given by him was not towards discharge of any legally enforceable debt … Since the presumption stands unrebutted, this Court has to hold that, the appellate court rightly upheld the conviction of the revision petitioner under Section 138 of the N.I Act, and sentenced him to undergo imprisonment till rising of the court and to pay fine of Rs.4 lakh”.