Dishonour of Cheque -- Friendly Transaction -- Presumption of legally enforceable debt rebutted where material shows a friendly transaction and not a contractual debt
(i) Negotiable Instruments Act, 1881, S.138 -- Dishonour of Cheque -- Friendly Transaction -- Presumption of a legally enforceable debt does not survive where material on record shows the transaction was a friendly one and did not amount to a contract creating a legally enforceable debt. In such a case, the Court must decide the matter on the material available on record rather than on the presumption alone. (ii) Negotiable Instruments Act, 1881, S.138 -- Dishonour of Cheque -- Absence of Commercial Consideration -- Consideration is a basic ingredient of a legally enforceable contract and it must be commercial in nature. Friendship cannot constitute consideration. Where no contract is formed for want of consideration, the underlying transaction is not a legally enforceable debt, and proceedings under Section 138 of the Act are not maintainable.
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