Dishonour of Cheque--Cheque Marked as Non Negotiable -- S.138 NI Act would be attracted
Endorsement "Not Negotiable" merely restricts transferability of title under Section 130 of the Negotiable Instruments Act but does not extinguish the drawer's liability or negate the instrument's validity for prosecution under Section 138. The endorsement does not render the cheque non-existent or invalid; it merely restricts the transferee from acquiring a better title than that of the transferor. The drawer's obligation to honour the cheque remains unaffected. Whether the cheque was issued toward a legally enforceable debt is a matter of evidence to be determined during trial, not at the interlocutory stage.
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