Supreme Court of India

Kundan Lal Rallaram v Custodian, Evacuee Property

AIR 1961 SC 131619611 min read
The case in brief30-second read
Facts
The appellant sued on promissory notes that had been endorsed to him. The Custodian of Evacuee Property disputed that consideration had passed for the endorsement.
Issue
How the presumption of consideration under S.118(a) of the NI Act operates, and how it can be rebutted.
Held
Once execution and endorsement are proved, S.118(a) presumes consideration and the evidential burden shifts to the party denying it. The presumption can be rebutted by direct evidence or by circumstances, including adverse inferences under S.114 of the Evidence Act from documents the plaintiff withheld. On the facts, the presumption was rebutted and the burden returned to the plaintiff, who failed to prove consideration.
Principle
S.118 presumptions are rebuttable and shift only the evidential burden; withheld evidence can rebut them.
Cite this

Facts

  • The appellant sued on promissory notes that had been endorsed to him. The Custodian of Evacuee Property disputed that consideration had passed for the endorsement.

Issue

  1. How the presumption of consideration under S.118(a) of the NI Act operates, and how it can be rebutted.

Held

  • Once execution and endorsement are proved, S.118(a) presumes consideration and the evidential burden shifts to the party denying it. The presumption can be rebutted by direct evidence or by circumstances, including adverse inferences under S.114 of the Evidence Act from documents the plaintiff withheld. On the facts, the presumption was rebutted and the burden returned to the plaintiff, who failed to prove consideration.

Cite this

Citation

Kundan Lal Rallaram v Custodian, Evacuee Property AIR 1961 SC 1316

Reported: https://www.casemine.com/judgement/in/5767b11de691cb22da6d3c55. This is an educational summary, not the judgment itself. Cite the reported version in professional or academic work.