What Should You Do If Your Cheque Bounces?
Cheque bounce is a word that describes the failed processing of a disbursed cheque for a variety of causes. One of the most common causes of a bounced cheque is a lack of money in the issuer’s account. In addition to charging a fee, the banks return or dishonor the cheques, often known as rubber Cheques. Furthermore, passing bad cheques is prohibited, and the offense can be made more serious depending on the amount and whether the activity crosses state lines.
Cheque Bounce is something that we’ve all experienced at some point in our life. Do you know, though, that the individual who issued the Cheque might face prison time? In India, dishonoring a Cheque issued to discharge any obligation or other duty owed by the drawer is a criminal act punishable by up to two years in jail, a fine up to double the value of the Cheque or both. Read till the end to know more about the legalities of Cheque Bounces in India!”
What Does the Law Say About This?
The factors necessary to create a crime involving the dishonor of Cheques have been listed in Section 138 of the Negotiable Instruments Act of 1881, and are listed below:
- The Cheque should have been written to pay off a legally enforceable debt or obligation.
- The Cheque should have been presented within its validity period.
- Due to the lack of money in the drawer’s account, the Cheque should have been dishonored.
- The payee or holder of the Cheque should have sent a written notice to the drawer demanding the amount of the Cheque within thirty days, and the drawer must have failed to pay within fifteen days of receiving the notice.
The drawer’s purpose is not taken into account for determining his guilt under this Section. It’s also worth mentioning that under Section 141 of the Negotiable Instruments Act, businesses, partnership firms, and other organizations of persons are likewise responsible for the violation described in Section 138.
Typically, the people in control of the firm (typically the directors or partners, depending on the situation) are held accountable for the same. They may claim defense on the basis that the violation was done without their knowledge or that they did all possible to prevent it from happening. A court hearing a matter under Section 138 may impose interim compensation of up to 20% of the total amount of the claim.
Complaining about a Cheque Bounce
If you’ve been given a Cheque that’s been returned as unpaid, you can pursue the following steps: Send a notification to the cheque’s drawer.
- If the cheque drawer does not honor the cheque within 15 days after receiving the notice, file a complaint with the appropriate court.
- Along with the complaint, including documents such as an oath letter and a copy of the notice issued.
To challenge your case, you should contact an expert.
What should you do if your Cheque bounces?
If your Cheque bounces, you will get a notification that you must pay within 15 days of receiving the notice. If you do not comply, a complaint may be made against you.
As per The Negotiable Instruments Act, 1881 Cheque bounce violations can result in up to two years in jail and a fine. Furthermore, the intent is not a factor in determining responsibility. Even if you had no intention of dishonoring the Cheque, you might be held accountable. As a result, the gravity and seriousness of this violation must be grasped. It is critical to remember that if this infraction was committed accidentally, the promised sum must be paid within the 15-day time limit. When it comes to fixing a legal matter, the first thing you should do is visit a Reso.
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