account closed
Advocate M J
(Querist) 28 February 2011
This query is : Resolved
Good Evening Respected Members
Sir my query is when a cheque was issued and thn after one year the account was closed .........can this lead to offense of cheque bouncing under 138 NI Act. According to Honble supreme court the cheque returned due to account closed and stop cheque does not attract section 138 of NI Act. IS this right sir
adv. rajeev ( rajoo )
(Expert) 28 February 2011
Yes it is right. The validity of the cheque is only 6 months from the date of issuance of the cheque. You have to sent it for collection within 6 months.
Amit Minocha
(Expert) 28 February 2011
the date on body of cheque would matter, 138 is attracted if it is within 6 months from date on the cheque and not from date of issue.
Sachin Bhatia
(Expert) 28 February 2011
If the cheque is presented with in six month of its validity and it is bounced for the reason account closed and stop cheque then it attracts section 138 of N.I.Act.
Kirti Kar Tripathi
(Expert) 28 February 2011
validity period of cheque is only six month, therefore, a cheque can be presented within six month from the date of issue. in case, the period of six month falls within the date of presentation of the cheque, in that circumstance section 138 NI Act is attracted otherwise if the cheque is presented after six month, the cheque is time barred and reason given as stop payment is not permissible under the law for time barred cheque. thus no action can be brought on this score.
Parveen Kr. Aggarwal
(Expert) 28 February 2011
Who has said that in case of account closed and stop payment section 138 is not attracted?
NOTTAM VENKATASAMY
(Expert) 01 March 2011
ONE CHEQUE IS VALID ONLY FOR 180 DAYS, YOU CAN USE THAT CHEQUE UP TO THE LIMIT, IF YOU PRESENTED THE SAID CHEQUE WITH IN THE PERIOD, WHAT EVER THE ENDORSEMENT EVENTHOUGH ACCOUNT CLOSED THAT IS ALSO ATTRACT THE 138 NI ACT, WHO SAID 138 NI ACT IS AGAINST THE ACCOUNT CLOSED ENDORSEMENT IT IS WRONG.DONT WORRY.
Guest
(Expert) 01 March 2011
As a supplementary query for reply by the experts --
What would be the position, in case the cheque was undated and issued one year back, but the holder of the cheque puts the current date on the cheque and presents the same in the bank after closure of account?
Amit Pateria
(Expert) 01 March 2011
Hi Mary John,
The account holder issued a cheque and when it was presented for clearance during the period of its validity [i.e. within 6 months from the date it was issued] it returned uncleared and the bank advice suggested "Account closed/Transferred to".
In this situation whether the account was closed prior to the issuance of such instrument or it was closed thereafter, in both of the conditions if the issuer refuses to pay the cheque amount despite the expiry of the notice period, provisions of Sec.138 of the N.I Act 1881 are attracted.
@ Mr. P.S. Dhingra : although it's not advisable but to meet the business requirements instruments without putting on any date are being issued on good will, such instruments are always at the risk on the issuer however if the account has been been closed issuer of such instrument can make the instrument good by acting accordingly to the Notice of demand.
Amit Pateria
(Expert) 01 March 2011
Here the term "date it was issued" refers to the actual date which the instruments bares and "not" the the date such instrument was handed over.
malipeddi jaggarao
(Expert) 04 March 2011
Mr.Dhingra, undated cheque can be dated subsequently and it is presumed that the date of issue is the date which is appearing on the instrument.
Advocate. Arunagiri
(Expert) 04 March 2011
If the cheque is presented within the time limit, and bounced because of account closed, the supreme court says "it will attract 138 case".
If the cheque is returned for stop payment, that is not a cheque bounce. But, if the cheque is returned for Stop payment but, the account is not having sufficient balance to honour the cheque, it will attract 138 offense.
Sarvesh Kumar Sharma Advocate
(Expert) 28 February 2011
