The Himachal Pradesh High Court held that admission of a signature on a cheque raises a statutory presumption of liability under Section 139 of the Negotiable Instruments Act, which must be rebutted by contrary evidence.
HP HC: Admission of Signature on Cheque Triggers Presumption Under NI Act
The Himachal Pradesh High Court has reaffirmed that the admission of a signature on a cheque creates a statutory presumption of consideration and guilt under Section 139 of the Negotiable Instruments Act, 1881. The burden then shifts to the accused to rebut this presumption by credible evidence showing no legitimate obligation existed.
In the matter before the Court, the accused admitted signing a blank signed cheque but claimed it was given as security and never intended for encashment. The Court held that such claims must be supported by strong corroborative evidence.
"The mere statement that the cheque was blank and given as security, without supporting documentary or circumstantial evidence, is insufficient to rebut the presumption under Section 139,"the Court observed.
This decision is crucial for practitioners handling NI Act prosecutions. It clarifies that signature admission is a pivotal moment in trial, after which the evidential burden on the accused becomes stringent. Lawyers defending such cases must prepare to produce tangible evidence—such as correspondence, witness testimony, or electronic records—to overcome the statutory presumption.
Citations
- Negotiable Instruments Act, 1881, Section 139
