In Brief
A merchant supplied rice bags to a trader on credit, and the trader issued cheques which were later dishonoured. The trader claimed the cheques were blank security instruments that should have been returned after cash payments were made. The courts below acquitted him, but the Supreme Court held that the merchant had proven a legally enforceable debt and that the statutory presumption under Section 139 of the Negotiable Instruments Act had arisen. The trader's receipts for some cash transactions could not rebut the presumption that the cheques were issued for credit purchases. The Court convicted the trader and imposed a fine with compensation, holding his defence implausible in normal business practice.
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