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A division bench of Supreme Court consisting of Justice L Nageshwar Rao and Justice Hemant Gupta recently held that burden to prove the existence of debt cannot be placed on the complainant in the cases of dishonour of cheques under Negotiable Instrument Act.
While deciding so, the court upheld the decision of Bombay High Court which had revered the acquittal of the accused. The reasoning given by the court was that the Magistrate had failed to take into consideration, the presumption given under Section 138 of Negotiable Instrument Act while dismissing the complaint. Section 138 of NI Act specifically mentions the presumption in favour of holder which says “It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in the section 138 for the discharge, in whole or in part, of any debt or other liability.”The High Court also directed him to deposit Rs. 1,20,000 within two months, and failing which he had to go under imprisonment for a term of one year.
In the present case the accused has filed an appeal against the judgment of the Bombay High Court. It was pleaded by him that the High Court has wrongfully given the decision against him and the decision of magistrate was supported by reasons. However, the Supreme Court does not agree with the same. It was held that the decision of Magistrate was wrong and erroneous as heavy burden was placed on the complainant. So, the court upheld the decision of Bombay High Court and dismissed the appeal.
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