Cheque bounce Law Videos - What to do in cheque bounce case

After a cheque bounces, the payee's bank gives a memo and the dishonoured cheque back to you after which one needs to send a formal written notice within 30 days of receiving the memo from the bank with all the relevant details to the drawer of the cheque and after such a notice, the drawer has 15 days to return the amount back.

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 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 accused is thereafter asked to lead his evidence and rebut the allegations against him. The court then proceeds to dispose off 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