Source: 6)a)7m,May20257 Marks
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Question Scenario

Ram purchased a second-hand car from his friend Rohan for 5 lakhs on 10th November, 2022. He paid 4 lakh immediately and promised to pay 1 lakh within a year. But, he could not pay the remaining amount till December-2023. On 5th January, 2024 Ram received an invitation for Rohan's wedding which he could not attend but sent a cheque of 51,000 as gift by post.\nWhen Rohan deposited the cheque, it was returned unpaid due to insufficient balance in the account of Ram. Rohan considered it as an offence under Section 138 of The Negotiable Instruments Act, 1881.\nAdvise\n(i) Whether Ram would be held liable for dishonour of cheque ?\n(ii) Whether Rohan was justified in considering this as an offence under Section 138 of the Negotiable Instruments Act, 1881.

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Suggested Answer

Ans – Provision of Sec. 138 will apply as per Answer – 19\ni) In the given question, Rohan received a cheque from Ram, for ` 51,000 as a gift for his marriage. In terms of section 138, cheque given as a gift does not fall within this section. Hence, Ram would not be held liable for dishonour of cheque.\nii) The explanation to the section provides that for the purpose of section 138 only a legally enforceable debt or other liability is to be taken into consideration. The cheque of ` 51,000 was issued in the nature of a gift and not as a part of the payment for the balance amount of car. Hence, Rohan was not justified in considering the dishonour of cheque, an offence under section 138 of the Negotiable Instruments Act, 1881.

Exam Strategy Tip

When answering law questions in the CA Foundation exam, follow the "Provision -> Facts -> Conclusion" structure for maximum marks. Ensure to state the relevant sections where applicable to earn bonus marks from the evaluator.

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