.jpg)
Cheque bounce cases, governed by Section 138 of the Negotiable Instruments Act, can have serious legal and financial implications. This blog aims to provide a thorough understanding of cheque bounce cases, including legal recourse for the aggrieved party and preventive measures to avoid such situations.
What Constitutes a Cheque Bounce?
A cheque is said to be bounced when the bank returns it unpaid due to insufficient funds, mismatched signatures or a stopped payment. Under Section 138, issuing a cheque that is subsequently dishonored constitutes a criminal offense, subject to legal penalties.
Legal Recourse
If you receive a bounced cheque, you can take the following steps to seek legal recourse:
- Issuing a Demand Notice: The first step is to issue a demand notice to the drawer of the cheque within 30 days of receiving the bounced cheque. The notice should demand payment of the cheque amount within 15 days.
- Filing a Complaint: If the drawer fails to make the payment within 15 days, you can file a complaint in the appropriate court within 30 days. The court may summon the drawer and conduct a trial.
- Legal Representation: Engaging a competent lawyer can significantly enhance your chances of a favorable outcome. Your lawyer will help you prepare the case, present evidence and argue on your behalf.
Preventive Measures
To prevent cheque bounce situations, consider the following measures:
- Maintain Adequate Funds: Ensure that your account has sufficient funds before issuing a cheque.
- Verify Details: Double-check all details on the cheque, including the date, amount and signature.
- Monitor Account Activity: Regularly monitor your bank account to ensure there are no discrepancies or unauthorized transactions.
- Communicate with Payees: Inform the payee immediately if there are any issues that might lead to a cheque bounce and try to resolve the matter amicably.