How do you take legal action on a bounced cheque?

After the expiry of 15 days of issuing the cheque bounce notice, the payee can initiate legal action against the drawer. The payee should register a complaint under Section 138 of the Act. Under Section 138 of the Act, the offence of cheque bounce is a criminal offence for which the payee can initiate a criminal suit.

What happens if a cheque bounces?

In India, a person issuing a cheque will be committing a criminal offence if the cheque is dishonoured (cheque bounce) for insufficiency of funds. Cheque bounce offence is punishable with imprisonment for a term up to two years or with a fine twice the amount of the cheque or both.

How can I recover my money from a bounced cheque?

The only way to recover the money of a dishonoured cheque is by filing a civil case. Dear Questioner, We suggest you file a criminal complaint against that person, who issued the cheque.

Is cheque bounce a bailable Offence?

No. A Magistrate can take cognizance of an offence of dishounour of Cheques under Section 138 of the NI Act only on a Complaint from the holder in due course (in this case the person in whose favour the cheque was drawn). Further, the offence is non-cognizable so the police cannot arrest without a warrant.

What is the court fee for cheque bounce case?

Court fees is 10,000/- for 5 lakhs. The court in who’s jurisdiction you are to file the case is the branch area you have deposited your cheque. Do send him a statutory notice before filing the complaint within 30 days of the cheque being bounced.

Is cheque bounce a crime?

If a cheque is bounced citing insufficient funds in bank account, it is a criminal offence and the payee – the person or the bank – can file a complaint under Section 138 of the Negotiable Instruments Act.

Why would a cheque be returned?

Generally, a returned check is one that a bank declines to honor — typically because there’s not enough money in the check writer’s account to cover the amount of the payment. You might know this situation as a “bounced check,” while the bank calls it “nonsufficient funds,” or NSF.

Will a bank rerun a returned check?

Neither federal nor state laws compel banks to redeposit returned checks or place limits on the number of times a bank can redeposit an item returned unpaid due to insufficient funds. However, major banks typically redeposit items that are returned unpaid.

How long does it take to settle a cheque bounce case?

A cheque bounce case will realistically take you anywhere from 1 to 2.5 years to conclude. The penalty amount is twice the cheque amount which should be more than enough to cover your expenses and the accused may just want to settle in the meantime.

Who is responsible if a cheque bounces?

If the Company has failed to reply or pay the amount of the cheque within 15 days from the legal notice, the payee can then file the complaint in a court of appropriate jurisdiction, within a stipulated time period of 30 days. The complaint should be accompanied by the following documents: An affidavit.