Part-Payment Made After Cheque Is Drawn Must Be Endorsed On Cheque As Per Section 56 NI Act : Supreme Court
www.livelaw.in
The Supreme Court has held that when a part- payment of the debt is made after the cheque was drawn but before the cheque is encashed, such payment must be endorsed on the cheque under Section 56 of the Negotiable Instruments Act. The cheque cannot be presented for encashment without recording the p
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- The Supreme Court has held that when a part- payment of the debt is made after the cheque was drawn but before the cheque is encashed, such payment must be endorsed on the cheque under Section 56 of the Negotiable Instruments Act.
- The cheque cannot be presented for encashment without recording the part payment. If the unendorsed cheque is dishonoured on presentation, the offence under Section 138 NI Act would not be attracted since the cheque does not represent a legally enforceable debt at the time of encashment.
- It must be noted that when a part-payment is made after the issuance of a post-dated cheque, the legally enforceable debt at the time of encashment is less than the sum represented in the cheque", the Court observed. "An offence under the provision arises if the cheque represents a legally enforceable debt on the date of maturity. The offence unde...
- Dashratbhai Trikambhai Patel versus Hitesh Mahendrabhai Patel and others
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