| Category | Dishonour of Cheque |
CHEQUE BOUNCE CASE
When you write a cheque in someone else's name, you take on the role of the drawer, and the recipient of the cheque is known as the payee. A Cheque bounce occurs when the payee attempts to cash the cheque at the bank but is unsuccessful for procedural reasons. Additionally, the causes of cheque bounce range from mismatched signatures to account number issues. However, bouncing a cheque for lack of funds is a criminal infraction rather than a careless act. Both civil and criminal laws may be used in a cheque bounce case in India.
Section 138 of the Negotiable Instruments Act
According to the provision, dishonoring a cheque refers to a person who has a bank account attempting to pay another person from that account to pay off a debt or other obligation in whole or in part and having the payment returned by the bank. When the indicated amount exceeds the value paid from that account by a contract made with the bank, the price may be returned for various reasons, including inadequate bank balance to meet the payment obligation. Such a person would face a sentence of up to two years in prison, a fine up to double the value of the cheque, or a combination of the two.
Reasons for cheque bounce
In India, there are many causes of bounced checks. There are numerous technical reasons why a cheque could be returned without payment. The Negotiable Instruments Act of 1881 states that the cheque bounce case section 138 may only be used if there is insufficient money. The following list of common cheque bounce causes has been updated:
Legal Procedure in case cheque bounce
1. The drawer must first get written notice that the cheque has been dishonored and that they must immediately repay the whole amount.
2. This Notice must be given within 30 days of the Payee's bank receiving the "Cheque Return Memo."
3. The notice addressed to the Drawer must specify a 15-day notice period.
4. If the Drawer pays off the full amount within the specified notification period of 15 days, there is no assumption that they have broken the law.
5. If not, the Payee may complain about the defaulting Drawee with the appropriate court.
6. Such complaint shall be made within one month of the expiry of 15 days prescribed in the notice.
Advocate Deepti Dogra provides the complete service for cheque bounce cases.
For more details contact
Deepti Dogra and Associate
Phone no.-8989696931
Email- [email protected]
1201, Vikas Surya Arcade, 2nd Floor, CU Block LSC Uttari Pitampura, New Delhi-110030
