Dishonour of Cheque -- Ponzi Scheme -- Involvement and Absence of Loan Details Rebuts Presumption of Legally Enforceable Debt
Under Section 138 of the Negotiable Instruments Act, 1881, the cheque must be drawn for discharge of a legally enforceable debt or liability. The statutory presumption under Section 139 is rebuttable on a preponderance of probabilities. A postal endorsement of "seven days absent" does not constitute deemed service where the accused establishes through evidence a genuine reason for absence during the relevant period. Once the accused raises a probable defence creating reasonable doubt about the existence of consideration, the burden shifts back to the complainant, who must then prove the debt as a matter of fact.
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