Facts
The complainant advanced a hand loan of ₹4,50,000 to the accused. The accused issued a cheque which was dishonoured for insufficiency of funds. After the statutory notice remained unanswered, a complaint under S.138 NI Act was filed. The Trial Court convicted the accused, and the Appellate Court affirmed the conviction with modification of sentence. In revision, the High Court acquitted the accused on the ground that the complainant had failed to prove his financial capacity to advance the loan. The complainant challenged the acquittal before the Supreme Court.
Issues Framed
Whether the High Court was justified in reversing concurrent findings of conviction under S.138 NI Act by holding that the complainant failed to prove financial capacity and by reappreciating the evidence in exercise of revisional jurisdiction.
Court's Reasoning
(a) The Court held that once the accused admitted his signature on the cheque, the statutory presumptions under S.118 and S.139 NI Act automatically arose that the cheque was issued for a legally enforceable debt. The burden thereafter shifted to the accused to rebut those presumptions through probable and cogent evidence. Mere denial or speculative defence was insufficient.
(b) The accused's defence that the cheque was a blank security cheque misused by the complainant was unsupported by any documentary evidence. The legal notice relied upon by the accused was issued after commencement of the complaint proceedings and was treated as an afterthought lacking evidentiary value.
(c) The complainant's financial capacity stood sufficiently established through his own testimony and corroborative evidence of PW-2 and PW-3 regarding financial assistance extended to him. The High Court erred in treating the complainant's monthly income alone as determinative of his capacity to lend.
(d) The Court reiterated that revisional jurisdiction is supervisory and not appellate. The High Court exceeded its jurisdiction by reappreciating evidence and upsetting concurrent findings without demonstrating perversity, illegality, or miscarriage of justice.
Held
The Supreme Court allowed the appeal, set aside the High Court's judgment, and restored the conviction and sentence passed by the Trial Court as affirmed by the Sessions Court.
Ratio
Admission of execution of a cheque attracts the mandatory presumptions under S.118 and S.139 NI Act, which can be displaced only by cogent rebuttal evidence; a High Court exercising revisional jurisdiction cannot overturn concurrent findings by reappreciating evidence unless the findings are perverse or legally unsustainable.
Relevant Para
Para 7.3
“The contours for exercise of revisional jurisdiction has been well settled by the judicial dicta of this Court wherein time and again it has been observed that the High Court shall not interfere with the orders of the lower court unless:
i. The order or finding of the lower court is perverse, grossly erroneous, glaringly unreasonable or wholly unreliable or untenable in law.
ii. The lower court has passed the impugned order after considering an immaterial or irrelevant material or no material at all.
iii. There is a non-consideration of any relevant material or the judicial discretion has been exercised arbitrarily or capriciously.”
Case Details
Citation: 2026 INSC 790
Decided on: 04 August 2026
Case Title: Kuntegowda v. Thurubaiah
Court: Supreme Court of India
Bench: B.V. Nagarathna, J.; Ujjal Bhuyan, J.