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Is stop-payment cheque considered bounce under Section 138?
13-Dec-2025 (In Cheque Bounce Law)
Subject: Is stop-payment cheque considered bounce under Section 138?
Query:
A cheque was cancelled/stop-payment issued via bank app before presentation and returned as “payment stopped by drawer.” The cheque was stopped due to defective, incomplete interior work and delays, with a documented dispute. The payee is calling it a cheque bounce and threatening Section 138 action. Does Section 138 apply in this case? What is the correct legal position?
Dear Sir,
Courts have held:
If payment is stopped due to bona fide contractual dispute,
and the cheque amount is not an admitted liability,
Section 138 prosecution fails.
This becomes a civil dispute, not a criminal offence.
Helpful?
Adv. Kishan Dutt Kalaskar
Bangalore / Bengaluru | 1000+ Answers
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Stopping payment doesn't end the underlying debt. If the payee sends a legal notice (under India's Negotiable Instruments Act), you must pay within 15 days or face criminal charges (fine/imprisonment). Apart from, you can file suit consumer court for service deficiency and claim damages. also you can file complaint criminal intimidation for threatening through phone. please take action soon
Helpful?
Adv. Praveenkumar S
Bangalore / Bengaluru | 5+ Answers
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