Legal Review and Analysis of Sanjabij Tari vs Kishore S Borcar & Anr 2025 INSC 1158
1. Heading of the Judgment
Sanjabij Tari vs. Kishore S. Borcar & Anr.
Citation: Criminal Appeal No. 1755 of 2010, Supreme Court of India, decided on September 25, 2025.
(2025) INSC 1158 (REPORTABLE)
2. Related Laws and Sections
The judgment primarily interprets and applies the following legal provisions:
Negotiable Instruments Act, 1881 (NI Act):
Section 138: Offence of dishonour of cheque for insufficiency of funds, etc.
Section 139: Presumption in favour of the holder that the cheque was received for the discharge of a legally enforceable debt or liability.
Section 118: Presumptions as to negotiable instruments, including that they were made or drawn for consideration.
Section 143A: Power of the court to direct interim compensation.
Section 147: Offences under the Act to be compoundable.Code of Criminal Procedure, 1973 (Cr.P.C.) / Bhartiya Nagarik Suraksha Sanhita, 2023 (BNSS):
Provisions related to summary trial, compounding of offences, and procedure for issuing summons.Income Tax Act, 1961:
Section 269SS: Mode of taking or accepting certain loans, deposits, and specified sums.Probation of Offenders Act, 1958.
3. Basic Judgment Details
Parties:
Appellant: Sanjabij Tari (the original complainant who alleged that his cheque was dishonoured).
Respondents: Kishore S. Borcar (the accused who issued the cheque) and Another.Subject Matter: This criminal appeal was filed by the complainant against the judgment of the Bombay High Court (Goa Bench) which had acquitted the accused under Section 138 of the NI Act. The High Court reversed the concurrent convictions recorded by the Trial Court and the Appellate Sessions Court.
Courts Involved:
Trial Court: Convicted the accused.
Appellate Court: Sessions Court upheld the conviction.
Revisional Court: High Court acquitted the accused.
Final Appellate Court: Supreme Court of India.
4. Core Principle and Legal Analysis
This judgment serves two paramount purposes: first, to clarify the law on presumptions under the NI Act and the limits of revisional jurisdiction; and second, to address the colossal backlog of cheque dishonour cases by issuing comprehensive, forward-looking guidelines for their expeditious disposal.
The Central Issue: The Scope of Presumptions under the NI Act and the Limits of Revisional Jurisdiction
The factual dispute was whether a cheque for Rs. 6,00,000 issued by the accused (Kishore Borcar) was for a legally enforceable debt or was a blank cheque given for some other purpose. The Trial Court and Sessions Court, applying the statutory presumptions, held the complainant's version to be true. The High Court, in revision, re-appreciated the evidence and acquitted the accused, primarily doubting the complainant's financial capacity to lend such an amount.
The Supreme Court's Analysis and Reasoning
The Supreme Court allowed the appeal, setting aside the High Court's order and restoring the conviction. The Court's reasoning is multifaceted:
A. Reinforcing the Mandatory Nature of Presumptions under Sections 118 and 139, NI Act
The Court delivered a strong rebuke to courts that dilute the statutory presumptions. It held that once the execution of the cheque (i.e., the signature) is admitted, Sections 118 and 139 of the NI Act raise a mandatory presumption that the cheque was for consideration and was issued to discharge a legally enforceable debt. The initial burden is squarely on the accused to rebut this presumption by raising a "probable defence." It is not for the complainant to first prove the existence of the debt. The Court criticized the trend of treating NI Act cases as ordinary civil recovery suits, which prolongs litigation and defeats the very objective of the statute.
B. Clarifying that Violation of Income Tax Act (Section 269SS) Does Not Invalidate the Debt
The Supreme Court expressly overruled the view taken by the Kerala High Court in P.C. Hari vs. Shine Varghese. It held that a cash transaction above Rs. 20,000 in violation of Section 269SS of the Income Tax Act may attract a penalty under that Act, but it does not render the debt "illegal" or "not legally enforceable" for the purpose of Section 138 of the NI Act. Such a violation cannot rebut the presumption under Section 139.
C. Reiterating the Limited Scope of Revisional Jurisdiction
The Court emphasized that a revisional court (like the High Court) cannot re-appreciate evidence or interfere with concurrent findings of fact recorded by the courts below unless the findings are perverse or suffer from a jurisdictional error. Since the Trial Court and Sessions Court had meticulously evaluated the evidence and found the accused's defence (that a blank cheque was given for obtaining a loan) to be "unbelievable" and "funny," the High Court exceeded its jurisdiction by substituting its own view.
D. Issuing Sweeping Guidelines for Expediting NI Act Cases
Acknowledging the "unprecedented strain" on the judicial system—with nearly 50% of pendency in some states being cheque bouncing cases—the Supreme Court issued 12 detailed guidelines (Paragraph 36 A-L). These are aimed at every stage of the process:
Service of Summons: Mandates dasti (direct) service by the complainant and use of electronic means (email, WhatsApp) based on details provided in an affidavit.
Early Settlement: Directs the creation of online payment facilities (QR codes/UPI links) linked to court accounts, allowing accused persons to pay the cheque amount at the outset and seek compounding.
Standardization: Requires every complaint to include a standardized synopsis for easy reference of key details.
Procedure in Court: Dispenses with pre-cognizance summons, introduces a specific questionnaire for the accused under Section 251 Cr.P.C./Section 274 BNSS to narrow down issues, and encourages the use of summary trial and interim compensation under Section 143A.
Monitoring: Orders the creation of dedicated dashboards in high-pendency cities (Delhi, Mumbai, Calcutta) and monthly reviews by District Judges to monitor disposal rates.
E. Modifying the Compounding Guidelines
The Court revisited its earlier guidelines from Damodar S. Prabhu (2010) and reduced the compounding costs to encourage early settlement:
Before defence evidence: Compounding allowed with 0% cost.
Before judgment by Trial Court: 5% of the cheque amount.
Before Appellate/Revisional Court: 7.5%.
Before Supreme Court: 10%.
Conclusion on the Core Principle
The Supreme Court reaffirmed that the presumptions under Sections 118 and 139 of the NI Act are the cornerstones of the statute and must be respected by courts. The judgment strengthens the credibility of cheques by placing the burden of explanation on the drawer. Simultaneously, it adopts a pragmatic approach to the systemic crisis by introducing robust procedural reforms to decongest the courts, emphasizing early settlement and efficient case management.
5. Final Outcome
The Supreme Court:
Allowed the appeal filed by the complainant, Sanjabij Tari.
Set aside the impugned judgment of the High Court dated April 16, 2009.
Restored the judgments of the Trial Court and the Sessions Court convicting the accused.
Directed the accused (Respondent No. 1) to pay a total of Rs. 7,50,000 to the complainant in 15 equated monthly instalments of Rs. 50,000 each.
Issued comprehensive guidelines for the expeditious disposal of cases under Section 138 of the NI Act, to be implemented by all High Courts and District Courts by November 1, 2025.
6. MCQs Based on the Judgment
Question 1 In the case of Sanjabij Tari vs. Kishore S. Borcar, what was the Supreme Court's primary criticism of the High Court's decision?
A. The High Court failed to award adequate compensation to the complainant.
B. The High Court exceeded its revisional jurisdiction by re-appreciating evidence and upsetting concurrent factual findings.
C. The High Court incorrectly applied the provisions of the Income Tax Act.
D. The High Court did not grant the accused an opportunity for a hearing.
Answer: B. The High Court exceeded its revisional jurisdiction by re-appreciating evidence and upsetting concurrent factual findings.
Question 2 According to the Supreme Court's judgment, what is the legal consequence of a cash loan transaction above Rs. 20,000 that violates Section 269SS of the Income Tax Act, 1961, in relation to a case under Section 138 of the Negotiable Instruments Act?
A. The transaction becomes void, and the cheque cannot be considered for a legally enforceable debt.
B. It attracts a penalty under the Income Tax Act but does not rebut the presumption of a legally enforceable debt under the NI Act.
C. The complainant is barred from filing a case under the NI Act.
D. The burden of proof shifts entirely to the complainant to prove the source of funds.
Answer: B. It attracts a penalty under the Income Tax Act but does not rebut the presumption of a legally enforceable debt under the NI Act.