Cheque bounce

if the cheque is not honored and instrument was refused to be enchased by bank, just get the memo and file complaint under 138 NIA

If the reason for not honouring the cheque for other than legally valid reasons, this legally invalid reason will not not constitute an offence under section 138 NI Act.

Therefore it is important to note the reason for not honouring the cheque before taking any legal action under cheque bounce offence 

Dear Ruban Sai,

Thank you for your query! I am Aadil and I will try to answer your question.

The short answer to your query is NO. A cheque bounce case cannot be applied here.

Cheque bounce cases are governed by the Negotiable Instruments Act, 1881. As per Section 138 of the same, a cheque bounce exists when any cheque drawn by a person who maintains an account with the bank for the purposes of fulfilling any debt or liability is returned by the bank unpaid due to insufficient amount of money in the account or because it exceeded the amount of money that was agreed to be paid by the bank as per an arrangement made with the bank by the drawer.

In this case, it cannot be said that the cheque has ‘bounced’ per se, instead it was simply not accepted because the KYC details were not yet verified in the account. This is not in violation of the Negotiable Instruments Act, 1881, and hence cannot come under the purview of a cheque bounce case.

Therefore if the cheque was not honoured because of the above said reason, a cheque bounce case cannot be applied here, and you may still apprise the drawer of this situation and ask them to pay the money by sending them a notice regarding the same. If the drawer does not resolve this situation, you may file a civil suit against them.

I hope this helps. Thank you for your time and patience!

Regards,

Aadil