THE HON’BLE SRI JUSTICE R.KANTHA RAO CRIMINAL APPEAL No. 1112 of 2006. JUDGEMENT This criminal appeal is directed against the Judgement dt. 22.6.2006 passed by the J.F.C.M. Tandur, Ranga Reddy District in C.C.No. 239 of 2002 acquitting the accused/1st respondent for the offence under Section 138 of the Negotiable Instruments Act (for short ‘the Act’). I have heard the learned Counsel for the respective parties. Brief facts of the case are that the 1st respondent borrowed an amount of Rs. 85,000/- from the appellant for his domestic expenses and subsequently in discharge of the said loan, issued a cheque for Rs. 85,000/- and the said cheque when presented for collection of the amount, it was dishonored. Thereafter, the appellant after issuing statutory notice filed the complaint against the 1st respondent for the offence under Section 138 of the Act. Before the trial court, the appellant examined Pws 1 and 2 and got marked Exs:P.1 to P.7. The 1st respondent/accused himself was examined as Dw.1 and got marked Exs:D.1 to D.3. The defense of the 1st respondent before the trial court was that the appellant/complainant failed to establish that there was legally enforceable debt and in discharge of the same, the cheque in question was issued and the said plea of the 1st respondent was accepted by the trial court and acquitted him of the offence under Section 138 of the Act. The 1st respondent however admitted borrowing of an amount of Rs. 100,000/- in the year 1997 and the complaint paid an amount of Rs. 85,000/- to the 1st respondent after deducting interest and he issued three blank cheques in favour of the appellant in the presence of Sri.Bichaiah, who is the brother of appellant and after paying the entire amount, the 1st respondent demanded the appellant to return the cheques but the same were not returned on some pretext or the other. Therefore, it is not the question that the 1st respondent never borrowed any amount from the appellant. The version of the 1st respondent is that the appellant using one of the blank cheques issued by him filed a false case against him. The learned Counsel for the 1st respondent contended that the learned trial court rightly held that since there was no document evidencing the loan advance to the 1st respondent, the appellant failed to establish that there is any legally enforceable debt. I see no force in the contention advanced by the learned Counsel for the 1st respondent. Even according to the 1st respondent also, he did not borrow the amount by executing any promissory note. Therefore, merely because the loan transaction is not evidenced by any document, it cannot be said that the debt is not true. Mere filing of Exs:D.1 to D.3 the counterfoils do not establish that one of the blank cheques was used by the appellant for the purpose of filing the present case under Section 138 of the Act. Except Exs:D.1 to D.3 no evidence is adduced by the 1st respondent in proof of his defense. Pw.2 who is said to be working as a collection boy in the shop of Pw.1 stated that on 14.6.2002 while he was present in the kirana shop, the 1st respondent came to the shop and gave the cheque in question which was drawn on the Co-operative Bank for an amount of Rs. 85,000/-. To arrive at a proper decision of the issue involved in this case, it is necessary to refer Section 139 of the Act, which reads as under: “139 Presumption in favour of holder: It shall be presumed, unless contrary is proved, for the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or any part, or any debt or other liability.” Since it is not at all the case of the 1st respondent that he never borrowed any amount from the appellant at any point of time and in view of the fact that the 1st respondent admitted the signature on the cheque in question and in view of the statement of Pw.2 that on 14.6.2002 the 1st respondent came to the shop of the appellant and issued the cheque in questin for an amount of Rs. 85,000/-, a presumption under Section 139 of the Act can be drawn in favour of the appellant and it is for the 1st respondent to rebut such presumption. The 1st respondent did not adduce any evidence with regard to the defense pleaded by him except filing Exs:D.1 to D.3. The learned trial court erroneously appreciated the evidence and facts and came to the conclusion that initial burden to prove the existence of legally enforceable debt is not discharged by the appellant. In fact, the appellant, as could be seen from the facts and evidence adduced by him discharged the initial burden and the respondent could not be able to rebut the presumption under Section 139 of the Act. The finding of the learned trial court therefore is not only contrary to the evidence on record but also perverse. The trial court ought to have held that the cheque in question was issued by the 1st respondent towards satisfaction of the legally enforceable debt. The judgement of the trial court is therefore cannot be sustained and is liable to be set aside. In the result, the order of acquittal passed by the trial court is set aside. The 1st respondent is found guilty of the offence under Section 138 of the Act and he is convicted and sentenced to suffer SI for a period of six months and to pay a fine of Rs. 5,000/-. In default of payment of fine, the 1st respondent shall suffer SI for one month. The appeal is allowed. _____________________ R.KANTHA RAO, J 2.09.2011. KRB. THE HON’BLE SRI JUSTICE R.KANTHA RAO CRIMINAL APPEAL No. 1112 of 2006. JUDGEMENT Dt. 02.09.2011.