Sri Om Sales Vs Abhay Kumar (Supreme Court of India)
Cheque Bounce Case Revived — Supreme Court Says High Court Cannot Test “Debt or Liability” at Quash Stage
Supreme Court allowed the appeal filed by M/s Sri Om Sales and set aside the Patna High Court order which had quashed proceedings u/s 138 of the Negotiable Instruments Act, 1881.
The complaint alleged issuance of a cheque of ₹20 lakh towards goods supplied, dishonour due to insufficiency of funds, service of statutory demand notice, and failure to make payment within the prescribed period.
The High Court, while exercising powers u/s 482 CrPC, quashed the complaint by holding that the cheque was not issued for discharge of any debt or liability.
Supreme Court held that such an exercise was impermissible at the pre-trial stage, as Section 139 of the NI Act raises a statutory presumption that the cheque was issued for discharge of a legally enforceable debt or liability.
The presumption u/s 139 is rebuttable only during trial by leading evidence, and not by conducting a roving enquiry at the quashing stage.
Disputed questions of fact, including whether the cheque was issued towards a debt or liability, cannot be examined while considering a petition u/s 482 CrPC.
Reliance was placed on settled precedents including Maruti Udyog Ltd., Rangappa v. Sri Mohan, Rajeshbhai Muljibhai Patel and Rathish Babu Unnikrishnan.
Supreme Court held that the complaint disclosed all essential ingredients of Section 138 NI Act and therefore could not have been quashed at the threshold.
Accordingly, the impugned High Court order was set aside and the criminal complaint was restored to the file of the Magistrate to be proceeded with in accordance with law, without any prejudice to the defence of the accused at trial
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
