1. Cheque bounce is a criminal offense in India that can result in imprisonment of up to 2 years or a fine, as per Section 138 of the Negotiable Instruments Act. 2. If a cheque is dishonored, the payee can send a notice to the drawer demanding payment within 15 days. If payment is not made, a complaint can be filed in court along with relevant documents. 3. Once a cheque bounce complaint is filed, the drawer will be summoned to court for proceedings. It is advisable to seek legal counsel to prevent imprisonment or fines for cheque bouncing.

1. Cheque Dishonoured -
Legal Tips On Your
Cheque Bounce

2. Cheque Bounce is something that all of us would have faced in
our lives. However, did you know that the person who had
issued the cheque can go to prison for the same? The dishonor
of a cheque drawn in furtherance of discharging, any debt or
other liability owed by such drawer, is considered to be a
criminal offense in India, punishable by imprisonment of up to 2
years, or with fine which may extend to twice the amount of
the cheque, or with both. Hence, we have discussed below the
legal provisions dealing with issues of cheque bounce.

4. What Does the Law Say?
As it stands, the ingredients required to constitute an offense
relating to the dishonor of cheques have been mentioned within
Section 138 of the Negotiable Instruments Act, 1881, and have
been reproduced below:

5. 1. The cheque should have been issued in discharge of a
legally enforceable debt or liability
2. The cheque should have been presented within the period
of its validity
3. The cheque should have been dishonored for want of funds
in the account of the drawer

6. 5. The payee or holder of the cheque should have issued,
within thirty days, a notice in writing to the drawer
demanding the amount of cheque
6. The drawer must have failed to make payment within fifteen
days of receipt of the notice.

7. The intention of the drawer is not considered relevant while
deciding his culpability under this Section. Furthermore, it is
worth noting that Section 141 of the Negotiable Instruments
Act also renders liable, companies, partnership firms, and other
associations of individuals liable for the offense mentioned in
Section 138.

8. Typically, the persons in charge of the company (usually
directors or partners, as the case may be) are held liable for
punishment under the same. They may claim defense on the
grounds that the offense was committed without their
knowledge or that they had exercised all due diligence to
prevent the commission of such offense. The Court trying a case
under Section 138 may order for interim compensation not
exceeding twenty percent of the amount of the cheque to the
payee during the pendency of the case.

9. Filing a complaint for Cheque Bounce
If you have been presented with a cheque which gets
dishonored, you can take the following steps:
1. Send a notice to the drawer of the cheque.
2. If the drawer of the cheque does not honor the cheque
within 15 days of the receipt of the notice, then file a
complaint before the prescribed Court.

10. 3. Submit documents such as oath letter, copy of the notice served
along with the complaint.
4. Preferably, approach a lawyer to contest your case.

11. What happens if your Cheque Bounces?
Once your cheque bounces, you will be served with a notice to
make the payment within 15 days of such notice. If you fail to
do so, a complaint against you may be filed. You will be
summoned to the Court, and a court proceeding will commence.
It is advisable to take legal help in such circumstances.

12. Cheque bounce offenses lead to imprisonment of up to 2 years
along with fine. Furthermore, intention does not play a role in
affixing liability. Hence, you may be held liable, despite not
intending to dishonor the cheque.
Conclusion

13. The severity and seriousness of this offense hence need to be
understood. It is pertinent to take care that if this offense has
been committed unintentionally, the amount promised should
be paid within the stipulated time period of 15 days. Also, it is
preferred that in the event of such a situation arising; one
should approach a lawyer and take advice.

14. Talk To A Lawyer Now!
When it comes to solving a
legal problem, consulting a
Legal Expert is the first thing
you should do.

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