Synopsis

The appellant (complainant) had entered into a contract with the respondents for supply of iron ore. The complainant paid Rs.35 lakhs by demand draft and claimed that the respondents issued a cheque of the same amount as collateral security. When the respondents allegedly failed to supply quality ore, the complainant presented the cheque, which was dishonoured. The trial court convicted the respondents under Section 138 of the NI Act. On appeal, the Sessions Court acquitted them. The High Court dismissed the complainant’s appeal, holding that: (i) the contract did not mention the cheque; (ii) the complainant presented the cheque before knowing whether the ore was sub‑standard; (iii) the complainant gave contradictory versions in a separate cheating complaint; (iv) the statutory presumptions under Sections 118 and 139 were rebutted by the respondents; (v) as on the date of presentation, there was no crystallised, enforceable debt or liability. The acquittal was upheld, applying the principle that an appellate court against acquittal will not interfere unless the trial court’s view is perverse.

Court: High Court of Bombay at Goa

Coram: Hon’ble Mr. Justice Ashish S. Chavan (Single Judge)

Date of Judgment: 4th May 2026

Citation: Criminal Appeal No.39/2017 (2016:BHE-GOA:974)

Core Law: Negotiable Instruments Act, 1881 – Sections 118, 138, 139 (presumptions and dishonour of cheque); Criminal Procedure Code, 1973 – Section 378 (appeal against acquittal).

1. Heading of the judgment

High court of bombay at goa

Criminal appeal no.39 of 2017

Kala mines and minerals (appellant) vs. Shri m. v. krishnamurthy & ors (respondents)

Coram: hon’ble mr. justice ashish s. chavan

Reserved on: 27th april, 2026; pronounced on: 4th may, 2026

2. Legal framework

Major laws and provisions involved:

• Negotiable instruments act, 1881 – section 118 (presumptions as to negotiable instruments), sect

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