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Admission of cheque issuance and signature thereon by accused creates presumption in favour of holder

February 15, 2020[2020] 114 367 (SC)

FEMA, BANKING & INSURANCE : Section 139 is an example of reverse onus clause and, therefore, once issuance of cheque has been admitted and even signature on cheque has been admitted, there is always a presumption in favour of complainant that there exists legally enforceable debt or liability and thereafter, it is for accused to rebut such presumption by leading evidence

• Where appellant-complainant had issued Foreign Exchange Currency/USD Travel Currency Card to accused but accused paid only part of amount and cheque issued in favour of complainant for balance amount were dishonoured, it was held that there was a presumption under section 139 that there existed a legally enforceable debt or liability as accused admitted issuance of cheques and his signature on cheque and, therefore, accused was to be convicted under section 138.

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