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Negotiable Instruments Act, 1881 · Chapter XVII: Of Penalties in Case of Dishonour of Certain Cheques for Insufficiency of Funds in the Accounts

Section 139: Presumption in favour of holder

In plain words

Unless the contrary is proved, it is presumed that the holder received the cheque to discharge, wholly or partly, a debt or other liability.

  • In Rangappa v Sri Mohan, the Supreme Court held that this presumption includes the existence of a legally enforceable debt, and that the accused can rebut it by raising a probable defence.

A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.

Read the in-depth explanation, with key Supreme Court rulings ↓

Official text

It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.

Source: India Code (indiacode.gov.in), the consolidated text published by the Legislative Department, Government of India. Text as updated on India Code on 15 October 2026. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.

Understanding this section

Section 139 creates a presumption in favour of the holder of a cheque: unless the contrary is proved, it is presumed the cheque was received for the discharge of a debt or other liability. In practice this decides most cheque bounce cases, because it shifts to the accused the burden of showing there was no enforceable debt.

What is presumed

Once the accused admits signing the cheque, the presumption arises that it was issued for a legally enforceable debt or liability. The presumption covers the existence of the debt itself, not only the purpose of the cheque.

How it is rebutted

The accused need not disprove the debt beyond reasonable doubt. He must raise a probable defence on a preponderance of probabilities. He can do this by leading his own evidence, or by pointing to material in the complainant's own case, such as doubts about the complainant's financial capacity to lend the amount. A bare denial is not enough.

Blank signed cheques

If the accused admits voluntarily signing a blank cheque and handing it over, the presumption still applies, even if someone else filled in the amount and other details. He remains liable unless he rebuts the presumption.

The courts' approach

Once the presumption is triggered, the focus shifts to whether the accused has rebutted it. Courts err if they demand that the complainant prove the debt in detail before considering the presumption.

Key Supreme Court rulings

  • Rangappa v. Sri Mohan 2010 INSC 289

    The presumption under section 139 includes the existence of a legally enforceable debt or liability; it is rebuttable, and the accused can rebut it by raising a probable defence on a preponderance of probabilities, without an unduly high standard of proof.

  • Bir Singh v. Mukesh Kumar 2019 INSC 149

    Section 139 is a presumption of law shifting the onus to the drawer; a person who signs a cheque and hands it over, even blank, remains liable unless he adduces evidence to rebut the presumption.

  • Rajesh Jain v. Ajay Singh 2023 INSC 888

    Once the presumption under section 139 is given effect, the evidential burden shifts to the accused, and the inquiry must focus on whether the accused has rebutted it; the courts below erred by not proceeding on that footing.

Common mistakes

  • Treating the presumption as conclusive. It is rebuttable on a preponderance of probabilities.
  • Making the complainant prove the debt in full before applying the presumption.
  • Assuming a blank cheque defeats the presumption.

Read with: Section 118 NI Act, Section 138 NI Act, Section 20 NI Act

Prepared with AI assistance as a study aid. Every ruling listed was checked against the Supreme Court's own judgments on this site, and quoted words appear in those judgments; linked names open the full judgment. Read the judgments themselves before relying on them. Not legal advice.

Supreme Court judgments citing the section 139