Rebuttable presumption of consideration in promissory notes survives absent credible rebuttal; missing account books alone is insufficient.

A duly executed promissory note carries a rebuttable presumption of consideration under Section 118 of the Negotiable Instruments Act, and the burden first lies on the defendant to rebut that presumption with credible evidence on a preponderance of probabilities. The defendant failed to discharge that burden, so the presumption remained intact. Non-production of the plaintiff's account books did not, by itself, warrant an adverse inference under Section 114 of the Evidence Act, because there was no clear basis to require those records for the transaction. The lower appellate court therefore erred in treating that omission as sufficient to negate the statutory presumption.

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Issues: Whether the presumption under Section 118 of the Negotiable Instruments Act stood rebutted so as to justify dismissal of the suit for want of consideration, and whether an adverse inference could be drawn against the plaintiff for non-production of account books under Section 114 of the Evidence Act.

Analysis: Once execution of the promissory note was accepted, the statutory presumption of consideration operated in favour of the holder. The presumption could be displaced only by convincing rebuttal evidence showing, on a preponderance of probabilities, that the consideration did not exist. The defendant did not discharge that initial burden. The plaintiff's non-production of account books did not, by itself, justify an adverse inference because there was no reliable basis to treat the transaction as one that necessarily depended on such accounts, nor was there a clear call for production of those records. The lower appellate Court therefore erred in treating the absence of account books as sufficient to negate the statutory presumption.

Conclusion: The presumption of consideration remained unrebutted, no adverse inference could be drawn on the facts, and the suit was liable to be decreed in favour of the plaintiff.

Ratio Decidendi: A duly executed promissory note carries a rebuttable presumption of consideration, and unless the defendant first rebuts that presumption by credible evidence, the plaintiff is not required to prove consideration by producing account books or similar records.

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