Cheque Bounce (Section 138 NI Act)
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Criminal and Commercial Litigation
Cheque Dishonour Cases under Section 138 of the Negotiable Instruments Act
When a cheque is returned unpaid for insufficient funds or because the amount exceeds the arrangement with the bank, the payee has a strict statutory route to recover the money. The timelines under the Negotiable Instruments Act, 1881 are short, and a missed deadline can end the case.
Advocate Ashish Jain represents payees who need to recover a dishonoured cheque amount, and drawers who need to defend a complaint, before the Magistrate courts in Delhi.
Chamber Practice Highlights
- Legal demand notice drafting and reply
- Complaint filing before the Magistrate
- Defence of Section 138 complaints
- Interim compensation and settlement
Scope of services
What we handle in cheque bounce matters
Legal Demand Notice
Drafting and sending the statutory notice within 30 days of receiving the bank return memo.
Complaint Filing
Filing the complaint within one month after the 15 day payment period given in the notice ends.
Defence for Drawers
Reply to notice, challenge on limitation, presumption, security cheques and signature disputes.
Interim Compensation
Applications under Section 143A for interim compensation of up to 20 percent of the cheque amount.
Settlement and Compounding
Negotiated settlement and compounding of the offence with court permission.
Appeals and Revision
Appeals against conviction or acquittal, including deposit requirements under Section 148.
How a matter proceeds
Stages of a Section 138 case
Review of documents
Cheque, bank return memo, agreement and payment history are examined.
Demand notice
Notice is sent within 30 days. The drawer has 15 days to pay.
Complaint
If unpaid, the complaint is filed before the Magistrate within the limitation period.
Trial and judgment
Summary trial, evidence, arguments and judgment, with scope for settlement.
FAQ
Frequently asked questions
Within what time must the notice be sent?
The notice must be sent within 30 days of receiving information from the bank that the cheque was returned unpaid.
How long does the drawer have to pay after the notice?
The drawer has 15 days from receipt of the notice. If payment is not made, the complaint can be filed within one month after that period ends.
What is the punishment under Section 138?
Imprisonment up to two years, or a fine up to twice the cheque amount, or both. Courts also frequently encourage settlement.
Where is the complaint filed?
Before the Magistrate having jurisdiction, generally where the payee holds the account in which the cheque was presented. The right court depends on the facts of each case.
Need advice on a bounced cheque?
Call to arrange a consultation at the Rohini Court chamber or the Sector 11 office, by prior appointment.
Call +91 78386 56755WhatsAppThis page gives general information only and is not legal advice. Each case depends on its own facts.