{"id":7512,"date":"2019-11-27T09:00:02","date_gmt":"2019-11-27T03:30:02","guid":{"rendered":"https:\/\/swaritadvisors.com\/learning\/?p=7512"},"modified":"2021-03-20T15:12:46","modified_gmt":"2021-03-20T09:42:46","slug":"procedure-to-file-cheque-bounce-cases","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/","title":{"rendered":"What is the Procedure to File Cheque Bounce Case?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">Cheque bounce is a grievous <em>criminal offence filed under Section 138 of the Negotiable Instruments Act, 1881<\/em>. Over the last decade, several bounce cases engulfed the Indian court. According to the Supreme Court&#8217;s data, there is over 40 lakh pending cheque bounce cases in India. Lets take a deep dig for <strong>Procedure to File Cheque Bounce Case<\/strong> in India.<\/p>\n\n\n\n<p>Some common reasons for dishonoured or <strong>bounced cheque<\/strong> <a href=\"https:\/\/www.investopedia.com\/terms\/b\/bouncedcheck.asp\">[1]<\/a>  are an <strong>insufficient balance<\/strong> in the account of the person drawing the cheque, expired <strong>validity of the cheque<\/strong>, and a disparity of signatures with the bank records. If you encounter a <strong>cheque bounce case<\/strong>, then you must know about the procedure of filing complain against it.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3a5e950da4b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3a5e950da4b\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/#Key_Characteristics_of_a_Cheque\" title=\"Key Characteristics of a Cheque\">Key Characteristics of a Cheque<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/#What_is_a_Cheque_Bounce\" title=\"What is a Cheque Bounce?\">What is a Cheque Bounce?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/#Primary_Reasons_for_a_Cheque_Bounce\" title=\"Primary Reasons for a Cheque Bounce \">Primary Reasons for a Cheque Bounce <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/#How_to_File_Cheque_Bounce_Cases_in_India\" title=\"How to File Cheque Bounce Cases in India?\">How to File Cheque Bounce Cases in India?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/learning\/procedure-to-file-cheque-bounce-cases\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Key_Characteristics_of_a_Cheque\"><\/span>Key Characteristics of a Cheque<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A cheque is an exchange bill drawn upon a designated banker which is only payable on demand by the applicant. <em>In legal terms<\/em>, &#8220;the organization or individual who issues the cheque is the &#8216;drawer.&#8221; While the organization or individual in whose favour the cheque gets issued is the &#8216;drawee&#8217;. Here are the <strong>principal features of a cheque<\/strong>:<\/p>\n\n\n\n<ul><li>A <strong>cheque must be in written form with a clear signature<\/strong> of the drawer.<\/li><li>The <strong>cheque should entail an unconditional order<\/strong>.<\/li><li>Any <strong>cheque must specify the Bank<\/strong>.<\/li><li>The <strong>amount of payment<\/strong> should direct towards an identified organization or person.<\/li><li>The <strong>cheque must be payable on demand always<\/strong>.<\/li><li>A cheque should be for a <strong>particular sum of money<\/strong>.<\/li><\/ul>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/pdc-all-about-dishonour-of-post-dated-cheques\/\">PDC: All about Dishonour of Post Dated Cheques<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_a_Cheque_Bounce\"><\/span>What is a Cheque Bounce?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>When a drawer sends a <em>cheque to the payee concerning payment of fees<\/em>, loans or salary, but instead of payment, the Bank returns it to the <em>payee stating lack of funds in the drawer&#8217;s account<\/em> then this is known as <strong>cheque bounce. Section 138 of the Negotiable Instrument Act<\/strong>, defines the entire process to follow in the <em>dishonour of checks<\/em>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Primary_Reasons_for_a_Cheque_Bounce\"><\/span>Primary Reasons for a Cheque Bounce <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There can be a substantial number of reasons for the dishonour of a cheque or a cheque bounce. Let&#8217;s have a look at some of them:<\/p>\n\n\n\n<ul><li><strong>Insufficient Funds in the Account:<\/strong>\u00a0A shortage of funds in the drawer&#8217;s account is one of the <em>chief reasons for cheque bounce cases<\/em>. For instance, if you obtain a cheque from a person whose account has little balance than the mentioned-amount on the cheque, in such a case, the <strong>Bank will not initiate the transaction<\/strong>. Henceforth, it will hinder the payment and <strong>dishonour the cheque<\/strong>.\u00a0<\/li><li><strong>An issue with the date on the Cheque:\u00a0<\/strong>The date on the <strong>cheque holds utmost significance<\/strong>. Any mistake or readability issue with the date can lead to a <strong>bounced cheque<\/strong>.<\/li><li><strong>Mismatch of Signature:\u00a0<\/strong>Every drawer needs to ensure that his signature on the cheque matches the <strong>signature in the bank records<\/strong>; otherwise, he has to bear severe consequences.<\/li><li><strong>A Difference in the Amount in Numbers and Words:<\/strong> If there is any dissimilarity in the payable amount in numbers and words, then, the bank will bounce that cheque. Moreover, the same action applies if the <strong>amount in words section<\/strong> involves some numbers or the other way round.<\/li><li><strong>Scribbling or Overwriting on the Cheque:<\/strong> Mistakes are <em>inevitable while framing a cheque<\/em>, but banks do not permit any sort of overwriting or scribbling and dishonour it there and then. <\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_to_File_Cheque_Bounce_Cases_in_India\"><\/span>How to File Cheque Bounce Cases in India?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>You need to follow these steps in case of cheque bounce:<\/p>\n\n\n\n<ul><li><strong>Demand Legal Notice:<\/strong> In accordance with <strong>provisions of Negotiable Instruments Act, Section 138<\/strong>, the payee must send a formal notice to the <em>drawer after the cheque gets bounced<\/em>. Ensure to send the notice to the defaulter within <em>15 days of dishonour of notice<\/em>.<\/li><li><strong>Draft Important Details in the Notice:\u00a0<\/strong>It is essential to <em>draft the legal<\/em> notice carefully without committing any mistakes. The best practice is to <strong>appoint a lawyer<\/strong> and provide him with all the details. A <em>well-framed legal notice consists of all the facts<\/em> regarding payee like the amount of Loan, the nature of the transaction, <em>Date of deposit in Bank, Date of dishonour of cheque, etc.<\/em><\/li><li><strong>Law provides Grace Period to the Drawer:\u00a0<\/strong>The <em>Drawer gets 15 days grace period to pay off his debt<\/em> to the payee as per the notice. To grant a second chance to the Drawer, <strong>Law gives 15 days grace period<\/strong> before taking any further legal action.<\/li><li><strong>If Drawer does not pay the debt within 15 days:<\/strong> When a person denies paying the rightful debt for having insufficient funds in his account, in this case, the payee has the right to file a complaint in the <strong>form of a CRIMINAL CASE<\/strong>.<\/li><li><strong>The payee has 30 days period to file the Criminal Case:\u00a0<\/strong>As per the law, the <em>complainant has 30 days<\/em> to file the case from the expiry of the <strong>15 Notice Period<\/strong> that was given to the Drawer to repay the debt.<\/li><li><strong>The court proceeds to issue the process:<\/strong>\u00a0After you <em>file a cheque bounce case<\/em>, the <em>court soon registers the case<\/em>. The <em>Magistrate listens<\/em> to the <em>arguments of the complainant<\/em> and then issues the required process. <\/li><li><strong>Police initiate the process issued by the court: <\/strong>The nearby <em>police station of the accused&#8217;s residence informs him about the case<\/em>. Thereby, he has to comply by serving the summons at his residence.<\/li><li><strong>The court may also issue a Warrant:\u00a0<\/strong>Lastly, in some of the cheque bounce cases, the accused remains absent on the Court Dates even after service of the summons. It compels the court to issue a warrant against him. Even the police have the power to bring the accused under custody and ultimately drag him into the next court hearing.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>As prevention is better than cure, so it\u2019s better to take\u00a0<strong>professional assistance<\/strong>\u00a0when stuck in a\u00a0<strong>cheque bounce case<\/strong>. Therefore, seek the guidance of an experienced lawyer who will sail you through in obtaining your money back.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/difference-between-director-and-shareholder\/\">What is the Difference between Director and Shareholder?<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Cheque bounce is a grievous criminal offence filed under Section 138 of the Negotiable Instruments Act, 1881. Over the last decade, several bounce cases engulfed the Indian court. According to the Supreme Court&#8217;s data, there is over 40 lakh pending cheque bounce cases in India. Lets take a deep dig for Procedure to File Cheque [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":7513,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[666,1],"tags":[1125],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7512"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/comments?post=7512"}],"version-history":[{"count":20,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7512\/revisions"}],"predecessor-version":[{"id":18223,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/7512\/revisions\/18223"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media\/7513"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media?parent=7512"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/categories?post=7512"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/tags?post=7512"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}