Archive · 5 Sep 2025
Supreme Court: Cash Transactions Valid Despite No Bank Record
Imagine someone lends money, part of it in cash.
Later, if there's a dispute, and no bank record exists for the cash, a lower court said the cash part didn't happen.
The Supreme Court disagreed!
They said if someone says they paid cash, that's enough unless proven wrong.
It's like a signed IOU; if the borrower signed it, they can't easily say they didn't get all the money.
The court said that cash payments happen and are valid, even without bank records.
They sided with the person who lent the money, stating the borrower owed the full amount recorded in the promissory note.
The Supreme Court ruled cash transactions cannot be dismissed solely due to lack of bank records.
The case involved a dispute over a loan with both bank transfers and cash payments.
The Kerala High Court had previously reduced the recoverable amount, disregarding the cash portion.
The Supreme Court emphasized the importance of the promissory note acknowledging the total amount.
The court stated that the burden was on the borrower to disprove the claim if the promissory note existed.
- Who
- The Supreme Court of India.
- What
- Ruled that cash transactions cannot be disregarded simply because they lack bank records, especially when a promissory note exists.
- When
- The ruling was made recently.
- Where
- The Supreme Court of India.
- Why
- To clarify that the absence of documentary proof does not automatically invalidate a cash transaction, particularly when supported by other evidence like a promissory note.
- Court
- Supreme Court of India
- Judges
- Justices Ahsanuddin Amanullah and Vipul M Pancholi
- Appellant
- Georgekutty Chacko
- Respondent
- MN Saji
- Original Loan Amount
- Rs 30,80,000
- Amount Transferred via Bank
- Rs 22,00,000
- Trial Court Decree
- Rs 35,29,680
- High Court Ruling
- Reduced decretal amount to Rs 22,00,000