A Legally Enforceable Debt IV


Though a post-dated cheque might be drawn to represent a legally enforceable debt at the time of its drawing, the cheque must represent the legally enforceable debt at the time of encashment.   

The sum, as represented in the cheque at the time of encashment, was not owed. Since the cheque did not represent the legally enforceable debt at the time of encashment, offence under Section 138 of The Negotiable Instruments Act, 1881 is not made out.

It was contended, drawers of cheques could evade prosecution under Section 138 by paying a small amount of the debt while defaulting on the remaining payment. An endorsement may be made by recording the part-payment of the debt in the cheque or in a note appended to the cheque. If the endorsed cheque when presented for encashment of the balance amount is dishonoured, drawee can take recourse to Section 138.

Hon’ble Justice Dr. D.Y. Chandrachud, Dashrathbhai Trikambhai Patel v. Hitesh Mahendrabhai Patel, [Criminal Appeal No. 1497 of 2022].



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