The Supreme Court of India has clarified that the absence of documentary proof doesn’t necessarily nullify cash payments in recovery suits. This ruling emphasizes that while documentary evidence is important, it lack doesn’t automatically invalidate claims of cash transactions, particularly in money recovery suits.
Key Points
Burden of Proof: In money recovery suits, the defendant bears the burden of proof if they claim a payment was a full and final settlement or gratuitous.
Cash Transactions: The Supreme Court has indicated that cash payments shouldn’t be disbelieved solely due to a lack of documentary evidence.
Promissory Notes: Amounts recoverable under a promissory note can’t be reduced merely because part of the transaction was in cash without documentary proof.
Section 70 of Indian Contract Act: This section deals with obligations of persons enjoying benefits of non-gratuitous acts, playing a role in determining liabilities in money recovery cases.
Implications
Money Recovery Suits: Plaintiffs can pursue recovery based on credible claims, even with limited documentation.
Defendant’s Responsibility: Defendants must provide robust evidence to support their claims of settlement or gratuitous payments.
This judgment underscores the importance of understanding legal nuances in recovery suits and highlights the Supreme Court’s stance on evaluating evidence in such cases.
