What to do in case of bounced cheque
In the world of digitization, people either do bank transaction online or through bank cheques. And in cheque transaction many times we hear that a cheque becomes a bounced cheque or dishonoured. There are many reasons under which a cheque can be bounced. But, do we know under section 138 and certain grounds we can file a case against the drawer or a defaulter of a cheque?
If you are also the one who submitted the cheque to the bank and the issued cheque becomes a bounced cheque, then need not to worry. Just follow the guidelines given below and take the right action under section 138 accordingly.
Few facts about Cheques:
• Cheques can be valid only for 3 months. After three months of period, the particular cheque gets cancelled and has no value
• One can give cheque for any type of bank transactions
• Cheques can also be used for donation to NGO’s
• Cheques are issued for the purpose of keeping the money as security in any business
Complain Under Section 138:
After the cheque bounces one has to send a notice to the defaulter of the cheque given by. If the creditor will not get any reply from the debtor, then within 15 days creditor of the cheque can send a notice to the debtor and file a case. According to Kapil Shankla, Lawyer, Supreme Court of India- “India is going through cashless economy; in this situation, there should be some special court to solve cheque bounce cases, where one can resolve the cases through fastrack court as soon as possible.”
• If a cheque bounces and the amount is not paid to you, then send a demand notice letter to the party (Drawer) that gave cheque to you, and inform them about the actions under the Negotiable Instruments Act 1881 Section 138.
• If a drawer is an individual then the case will be file under Negotiable Instruments Act Section 138
• While in case of a company, if a cheque bounces, then one can prosecute the managing director of the company under Section 141
• One must send the demand notice within 30 days from the date of bounced cheque issued to you
• Demand notice is usually employed to inform the issuer of the cheque to do the payment within 15 days else he or she will be prosecuted
• One can file a complaint from the place where the cheque was drawn, cheque was presented, returned by the bank or the place from where he or she sent a demand notice to the defaulter/debtor
• Remember, one cannot take legal action if the cheque given to you was for gift, advertisement or a donation
• According to RBI’s rule, the bank has the right to stop issuing cheque books to the customer who had a record of bounced cheque more than 4 times
• If offence has been done at least four times with cheque valued over Rs 1 crore, then the bank has the right to stop issuing cheque book to the customer
• One may get two years jail and debtor has to pay the due amount along with double interest rate charges (depends on the decision of the court)
Before filing a complaint against a debtor always go through the detail along with the reason in a slip as for why cheque bounced. Try to keep a sufficient amount in your account before issuing a cheque to anyone; else you have to face legal consequences.
