In the case titled as Uttam Ram v. Devinder Singh Hudan and Ors., SC Bench comprising of Justice L. Nageswara Rao and Justice Hemant Gupta has held the decision of both the High Court and trial court to acquit the respondent to be illegal and totally unsustainable in law. According to general rule, the holder of cheque in due course is required to prove that the cheque was issued by the Accused and that when the same presented, it was not honored.

SC Bench stated that since there is a statutory presumption of consideration, the burden is on the Accused to rebut the presumption that the cheque was issued not for any debt or other liability. In Kumar Exports, it was held that mere denial of existence of debt will not serve any purpose but Accused may adduce evidence to rebut the presumption.

The accused failed to lead any evidence before the Supreme Court to rebut the statutory presumption. The decision of both the High Court and the Trial Court was based on finding that there existed discrepancy in the cartons, packing material or the rate to determine the total liability and the amount on the cheque exceeded the total liability of accused and proceeded as if the Appellant was to prove his debt before the Court.

The Supreme Court on observation found that the accused failed to lead any evidence to rebut the statutory presumption. Therefore, it presumed that the cheques in question were drawn for consideration and the holder of the cheques i.e., the Appellant received the same in discharge of an existing debt.

Thus, the Order passed by the High Court was set aside and directed the respondent/accused to pay twice the amount of cheque ₹5,38,856 and cost of litigation of ₹1,00,000.