Cheque Bounce under Section 138 of Negotiable Instrument Act
Cases of cheque bounce are common these days, Dishonour of cheque is an offence under Section 138 of Negotiable Instrument Act, if the following ingredient are fulfilled.
- Cheque is issued for discharge of any debtor liability.
- Cheque is presented within its validity period. That cheque is returned by the bank unpaid either because of the insufficient fund or it exceeds the amount arranged to paid from that account by an agreement made with bank.
- The payee issues a notice to drawer written 30 days of return of cheque.
- After such notice, the drawer fails to pay the cheque within 15 days of receipt of such notice.
