Kerala High Court holds that a Blank Cheque issued attracts presumption under section 139 of Negotiable Instruments Act when signed voluntarily.

The Kerala High Court has dismissed a Revision Petition holding that the petitioner should have rebutted the presumption under Section 139 of the N.I Act, and he should have adduced cogent evidence for disproving the cheque. The facts leading to the filing of the Revision Petition are that a Criminal Complaint was filed by the 1st respondent against the petitioner herein alleging an offence under section 138 of the Negotiable Instruments Act. The 1st Respondent’s case was that the revisionist had borrowed an amount of Rs.4 lacs and towards its discharge he issued a cheque assuring him that there would have been sufficient funds in his bank account to honour the same. However the cheque was dishonoured due to insufficiency of funds and a subsequent demand notice was issued to the revisionist. The amount had remained unpaid and hence a private complaint was filed and the Magistrate on analysing the facts and evidence, found the revision petitioner guilty under Section 138 of the N.I Act, and was sentenced to undergo simple imprisonment for six months and to pay compensation of Rs.4 lakh with interest @ 9% per annum from the date of dishonour of the cheque till the date of payment. In default, he had to undergo simple imprisonment for six months more. 
Aggrieved by the order of the Magistrate the revisionist filed a criminal appeal and on analysing the available facts and evidence, the appellate court confirmed the conviction, but the substantive sentence of simple imprisonment for six months was reduced to imprisonment till rising of court, and the compensation amount of Rs.4 lakh awarded by the trial court was converted into fine amount, and in default of payment of fine, the revision petitioner was directed to undergo simple imprisonment for two months, with a further direction that the fine amount will be paid to the complainant as compensation under Section 357(1) of Cr.P.C. 
Now aggrieved by the order of the Appellate court the revisionist filed a Revision Petition before the High Court of Kerala. The High Court observed thus:
“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. The contentions with regard to the vehicle loan, entrustment of blank cheque etc. are liable to be rejected, as no evidence is forthcoming to support the same. As he is admitting that, Ext.P1 cheque was signed by him and it was voluntarily given by him to the 1 st respondent, not under any threat or coercion, the presumption under Section 139 of the N.I Act is very much available to the 1 st respondent, and the revision petitioner failed to rebut that presumption.”
“The mode of advancing the money is irrelevant, as far as a complaint under Section 138 of the N.I Act is concerned, and what is relevant is whether the cheque in question was issued towards discharge of any legally enforceable debt.”

P.K. UTHUPPU Vs. N.J. VARGHESE & Anr.