Cheque bounce Law Videos - How to file a cheque bounce case

Cheque Bounce is a criminal offence under the Negotiable Instruments Act. A cheque bounces when a person has issued a cheque without maintaining sufficient amount in the account and as a result the cheque is returned by the bank unpaid. Before filing a case the holder of the cheque has to send a notice by Registered Post/Courier/E-Mail/Speed Post to the defaulter within 30 days from receiving the 'cheque return memo' from the bank. Then a 15 day period after receiving the said notice is given to the defaulter to repay the cheque amount. If the defaulter fails to payback, a complaint u/S. 138 of NI Act should be filed within a 30 days from the date on which the statutory period of 15 days to repay expires.
 
In case the notice is not issued within 30 days from the date of dishonour, the Payee/holder of the cheque loses the limitation period which in turn disables him/her from filing a cheque bounce case. It is important to make sure that the notice is delivered properly, if there is no intimation of delivery, the complaint will not be taken up in the court. If the offence is committed, the drawer/defaulter/Accused will be punished with imprisonment for a term which may extend to two (2) years, or with fine which may extend to twice the cheque amount or both.
 
The procedure to file a cheque bounce case is as follows:

• After a complaint has been filed u/S. 138, the court issues a notice to the defaulter who has issued a cheque after filing of the complaint and the said person is requires to appear before the court and seek bail and contest the matter if any frivolous issue is raised
• After that all the evidences in support (cheque, memo issued by bank, record showing service of notice on the defaulter, all other relevant documents in support) have to be submitted by the complainant which can prove that the defaulter is under legal obligation to pay the amount
• Trial under Sec. 138 is summary the court has to take into consideration the records furnished by the complainant and the evidence in support. The complainant is asked to lead his evidence during which he summons the records from the bank related to the cheque. The accused is given the opportunity to cross examine. The accused is thereafter asked to lead his evidence and rebut the allegations against him.
  The court then proceeds to dispose of the matter on the merits and accordingly arguments on all issues are head and the matter is decided accordingly.

 
Even if the cheque is dishonoured, the law has made sure that the money is not lost and therefore section 138 of NI Act makes cheque bouncing a criminal offence and lands the defaulter of the same into grounds of deep trouble until he returns the amount in question.