#presumption under NI Act

The Madhya Pradesh High Court ruled that an accused can rebut the presumption of financial capacity under Section 138 of the Negotiable Instruments Act only if the challenge is raised in the statutory notice or during trial. Documentary evidence, such as bank statements, will be admissible solely if this procedural requirement is met, impacting defence strategies in cheque bounce cases.

The Bombay High Court holds that failure to produce the original resolution authorizing a bank representative to file a complaint under Section 138 NI Act cannot override the statutory presumptions under Sections 118 and 139, provided the essential ingredients of cheque dishonour are established. This reinforces that procedural lapses in authorization are secondary to substantive proof in negotiable instruments cases, protecting financial institutions from technical acquittals.