BANKING AFFAIRS

Detailed explanation-1: -The provisions of sec. 143 to 147 were newly inserted and provisions of section 148, 141, 142 were amended. Section 138 of Act deals with dishonour of cheques.

Detailed explanation-2: -Section 138 in The Negotiable Instruments Act, 1881. Take notes as you read a judgment using our Virtual Legal Assistant and get email alerts whenever a new judgment matches your query (Query Alert Service).

Detailed explanation-3: -The Supreme Court observed that the legal requirement which Section 138 embodies is that a cheque must be drawn by a person for the payment of money to another ‘for the discharge, in whole or in part, of any debt or other liability’. A cheque may be issued to facilitate a commercial transaction between the parties.

Detailed explanation-4: -1[139. Presumption in favour of holder.-It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.]

Detailed explanation-5: –A promissory note, bill of exchange or cheque is payable to order which is expressed to be so payable or which is expressed to be payable to a particular person, and does not contain words prohibiting transfer or indicating an intention that it shall not be transferable.