
Understanding Cheque Bounce Laws in India: Legal Remedies and Consequences
In India, cheque bounce cases are governed under Section 138 of the Negotiable Instruments Act, 1881. A cheque is said to be dishonoured or bounced when it is returned by the bank unpaid due to insufficient funds, a mismatch in signature, or the account being closed. Key Provisions of the Law: Legal Notice: The payee must issue a written demand notice to the drawer within 30 days of receiving the cheque return memo from the bank. The drawer has 15 days from receiving the notice to make the payment. Filing a Complaint: If payment is not made within the stipulated 15 days, the payee can file a criminal complaint before the magistrate within 30 days of the expiry of the notice period. Punishment: The offence is punishable with imprisonment up…