One of the important condition to make out a case of cheque bouncing under Section 138 of the Negotiable Instruments Act is that the cheque should have been issued for the discharge, in whole or in part, of any debt or other liability.
In your facts, while it is not fully clear as to whether you have entered into any MOU as per which you have agreed to pay the cheque amount as a consideration of withdrawal of the case against you. If that is the case, then PERHAPS it may be considered as a liability.
Otherwise, if the cheque has been taken under duress, threat or gun point, as you have mentioned, then the cheque may not be for discharging any debt or liability. In such a situation, the cheque bouncing case may not be proved even if the cheque bounces. However, you’ll have to defend the case and prove this point, since there is a presumption under law under Section 139 that the cheque was issue for discharge of such debt or liability. So, the burden will be on you to prove that there was no debt or liability and that the cheque was given under threat, duress or gun point.
Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.
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