Himanshu v. B. Shiva Ram

Supreme Court of India(2023) 3 SCC 553

Bench: J. B.R. Gavai, J. C.T. Ravikumar

The Supreme Court held that Section 138 NI Act requires the cheque to have been drawn "for the discharge, in whole or in part, of any debt or other liability." The term "legally enforceable" is an express statutory qualifier — a debt that is time-barred under the Limitation Act is not legally enforceable since the remedy to recover it through court is extinguished. A cheque issued in respect of a time-barred debt does not satisfy the requirement of being issued for a "legally enforceable" liability. The Court held that the presumption under Section 139 NI Act is a rebuttable one — the accused successfully rebutted it by establishing that the underlying debt was time-barred. The complaint was quashed.