Legal Question in Banking Law in India

Re: bounce cheque

Prior legal notice within 30 days is required first to drawer of cheque. Time of period is not provided in law. 138 of NI is reproduced here:---

138. Dishonour of cheque for insufficiency, etc., of funds in the accounts

Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for 2["a term which may extend to two year"], or with fine which may extend to twice the amount of the cheque, or with both:

Provided that nothing contained in this section shall apply unless-

(a) The cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier.

(b) The payee or the holder induce course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer, of the cheque, 3["within thirty days"] of the receipt of information by him from the bank regarding the return of the cheques as unpaid, and

(c) The drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation: For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability].

Re: bounce cheque

You may first send him a registered letter informing him about bouncing of cheque; making a request / demand for the money represented by the cheque.

Re: bounce cheque

Please read Sections 138 to 142 of the Negotiable Instruments Act for appropriate guidance.

Re: bounce cheque

No you have to sent him legal notice thru an advocate giving 15 days time for payment. i will advise to sent the notice immediately within 2 or 3 days so you will be well within limitation.

Re: bounce cheque

Firstly, you will have to send a notice through your lawyer to the person who has issued the cheque stating that the cheque has been bounced and demand payment from him (giving 14 days notice period to pay). If he fails to comply, you can go for filing the case against him u/s 138 NI Act. The time limit for notice period is 30 days.