Sanjabij Tari v. Kishore Borcar
“Presumptions Under Section 138 NI Act Cannot Be Lightly Ignored”
TL;DR
The Supreme Court restored conviction in a cheque bounce case, holding that presumptions under Sections 118 and 139 of the NI Act are strong safeguards that cannot be lightly ignored. High Courts must not re-appreciate evidence in revision and upset concurrent factual findings.
The Bottom Line
If a cheque bounces, the law presumes you owe the money. You must prove otherwise. High Courts cannot act as appellate courts in revision proceedings.
Case Timeline
The journey from FIR to Supreme Court verdict
Loan Advanced
Complainant claims to have given Rs. 6 lakh loan to accused
Loan Advanced
Complainant claims to have given Rs. 6 lakh loan to accused
Cheque Issued
Accused issued cheque for Rs. 6 lakhs
Cheque Issued
Accused issued cheque for Rs. 6 lakhs
Cheque Dishonoured
Cheque bounced due to insufficient funds
Cheque Dishonoured
Cheque bounced due to insufficient funds
Statutory Notice Sent
Complainant issued notice under Section 138
Statutory Notice Sent
Complainant issued notice under Section 138
Criminal Complaint Filed
Complaint filed after no payment within 15 days
Criminal Complaint Filed
Complaint filed after no payment within 15 days
Trial Court Conviction
Accused convicted under Section 138 NI Act
Trial Court Conviction
Accused convicted under Section 138 NI Act
Sessions Court Appeal
Conviction upheld on appeal
Sessions Court Appeal
Conviction upheld on appeal
High Court Acquittal
High Court acquitted accused in revision
High Court Acquittal
High Court acquitted accused in revision
Supreme Court Judgment
High Court order set aside; conviction restored
Supreme Court Judgment
High Court order set aside; conviction restored
The Story
The appellant Sanjabij Tari (complainant) claimed to have advanced a friendly loan of Rs. 6,00,000 to the respondent Kishore S. Borcar (accused), who was a close friend. To discharge this liability, the accused issued a cheque which was dishonoured due to insufficiency of funds.
After the cheque bounced, the complainant issued a statutory notice under Section 138 of the Negotiable Instruments Act demanding payment. The accused did not pay within 15 days and also did not reply to the notice.
The complainant filed a criminal complaint under Section 138 NI Act. The Trial Court examined the evidence and convicted the accused. The Sessions Court upheld the conviction on appeal.
The accused then filed a revision petition before the High Court of Bombay at Goa. The High Court, in an ex-parte judgment dated 16th April 2009, acquitted the accused by re-appreciating the evidence and finding that the complainant had no financial capacity to lend Rs. 6 lakhs.
The complainant appealed to the Supreme Court challenging the High Court's order.
Legal Issues
Click each question to reveal the Supreme Court's answer
Arguments
The battle of arguments before the Supreme Court
Petitioner
Vihaan Kumar
Presumptions apply strongly
Sections 118 and 139 NI Act create strong presumptions in favor of the cheque holder that the cheque was issued for discharge of debt.
High Court exceeded jurisdiction
The High Court in revision cannot re-appreciate evidence and act as an appellate court.
No reply to notice
Accused did not reply to the statutory notice, which undermines his defense.
Respondent
State of Haryana
No financial capacity
The complainant had no financial capacity to advance Rs. 6 lakhs loan.
Blank cheque defense
The cheque was given as blank security cheque, not for any debt.
Court's Analysis
How the Court reasoned its decision
The Supreme Court found that the High Court had exceeded its revisional jurisdiction by re-appreciating evidence and upsetting concurrent factual findings of the Trial Court and Sessions Court. The Court emphasized that Sections 118 and 139 create strong presumptions that cannot be ignored without proper rebuttal evidence.
Presumptions under Sections 118 and 139 are strong safeguards and cannot be lightly ignored.
Para Para 15
Reinforces the strength of statutory presumptions in cheque cases.
Financial incapacity cannot be presumed without evidence. The accused must prove his defense, not merely assert it.
Para Para 22
Burden of rebutting presumption is on the accused.
Revisional jurisdiction is narrow; High Courts must avoid re-evaluating factual findings.
Para Para 28
Defines limits of revisional power.
Procedural lapses (non-reply to notice, blank cheque defenses) weaken the accused's case.
Para Para 32
Conduct of accused matters in assessing defense.
Cash loans, even if violating IT Act provisions, remain enforceable debts under Section 138.
Para Para 35
Tax violations do not make underlying debt unenforceable.
The Verdict
Relief Granted
Accused's acquittal reversed; original conviction under Section 138 NI Act restored.
Directions Issued
- High Court acquittal order set aside
- Trial Court and Sessions Court conviction restored
- Presumptions under Sections 118 and 139 must be respected
- High Court exceeded revisional jurisdiction by re-appreciating evidence
Key Legal Principles Established
Sections 118 and 139 NI Act create strong presumptions favoring cheque holder
Burden of rebutting presumption is on the accused issuer of cheque
High Courts cannot re-appreciate evidence in revision - only appellate courts can
Financial incapacity of lender must be proved, not presumed
Non-reply to statutory notice weakens accused's defense
Blank cheque defense requires strong evidence to succeed
Cash loans remain enforceable even if they violate Income Tax Act
Key Takeaways
What different people should know from this case
- If your cheque bounces, the law assumes you owe the money - you have to prove otherwise
- Never give blank signed cheques as "security" - they can be misused
- If you receive a cheque notice, respond immediately - silence hurts your case
- Even if a loan was given in cash, the cheque remains enforceable
Legal Framework
Applicable laws and provisions
Statutory Provisions
Section 138
Negotiable Instruments Act, 1881
“Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid...”
Relevance: Creates criminal liability for cheque dishonour.
Section 118
Negotiable Instruments Act, 1881
“Until the contrary is proved, the following presumptions shall be made: that every negotiable instrument was made or drawn for consideration.”
Relevance: Presumption of consideration for negotiable instruments.
Section 139
Negotiable Instruments Act, 1881
“It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque for the discharge, in whole or in part, of any debt or other liability.”
Relevance: Presumption that cheque was for debt.
Section 397
Code of Criminal Procedure, 1973
“The High Court or any Sessions Judge may call for and examine the record of any proceeding before any inferior Criminal Court...”
Relevance: Governs revisional jurisdiction and its limits.
Related Cases & Precedents
Rangappa v. Sri Mohan
followed(2010) 11 SCC 441
On presumptions under Sections 118 and 139 NI Act.
Hiten P. Dalal v. Bratindranath Banerjee
cited(2001) 6 SCC 16
On rebuttal of presumption in cheque cases.
Watch & Learn
Video explanations in multiple languages
Frequently Asked Questions
Explore Related Cases
More case summaries on similar legal topics
Vihaan Kumar v. State of Haryana
2025 INSC 162
The Case That Made Silence During Arrest Unconstitutional
Shajan Skaria v. State of Kerala
2024 INSC 625
When Criticism of a Public Figure Doesn't Become a Caste Atrocity
Just Rights for Children v. S. Harish
2024 INSC 714
Watching Child Pornography is NOT Just "Moral Decay" — It's a Serious Crime
Bhuwan Mohan Singh v. Meena
(2015) 6 SCC 353
Justice Delayed is Justice Denied - The Call for Swift Maintenance Orders
DISCLAIMER: This case summary is for educational and informational purposes only. It does not constitute legal advice. For advice on your specific situation, please consult a qualified advocate. JurisOptima is not responsible for any actions taken based on this information.
Facing aSimilar Situation?
Our advocates can help you understand how this judgment applies to your case.