Reply To: Bouncing of Cheque under Negotiable Instrument Act, 1881

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advtanmoy
Keymaster

A person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption

Bir Singh Vs. Mukesh Kumar, 2019 (4)  SCC 197 the Hon’ble Supreme Court observed and held:

“37. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted.

38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence.”