Practice area
Cheque bounce cases under Section 138
Whether you are owed money on a dishonoured cheque or have received a notice, the strict deadlines matter more than anything else. Here is how the process works.
In short
- Send a written demand notice within 30 days of the bank's return memo.
- The drawer then has 15 days to pay.
- If they don't pay, file a complaint within the following 30 days.
- Missing any of these deadlines can weaken or end the case, so act early.
When you may need help
- A cheque given to you for a debt or payment was returned “funds insufficient” or “account closed”.
- Payment was stopped on a cheque issued to you against a legally enforceable debt.
- You have received a Section 138 notice or summons and need to respond.
How the process works
| Stage | What happens | Typical time |
|---|---|---|
| 1. Notice | We draft and send the statutory demand notice. | Within 30 days of the return memo |
| 2. Waiting period | The drawer may pay the amount. | 15 days |
| 3. Complaint | We file the complaint with your affidavit and documents. | Within the next 30 days |
| 4. Summons & trial | Evidence and arguments. Settlement is possible at any stage. | Depends on the court's schedule |
Documents to keep ready
- Original cheque and the bank's return memo
- Proof of the debt: invoice, agreement, ledger, or messages
- Copy of the demand notice and postal/courier receipts, if already sent
- Your ID and address proof (or company authorisation, for a business)
The law, in plain words
Section 138 of the Negotiable Instruments Act, 1881 makes it an offence to issue a cheque for a legally enforceable debt that is then dishonoured, if the amount is not paid within 15 days of a proper demand notice. The court may impose imprisonment of up to two years, a fine of up to twice the cheque amount, or both. Under Section 143A, the court may also order interim compensation of up to 20% of the cheque amount.
General information only, not legal advice. The facts of your case may change the position.
Frequently asked questions
How long do I have to send a legal notice?
Within 30 days of receiving the bank's return memo. Keep proof of when you received it.
Can the matter be settled?
Yes. Section 138 offences are compoundable, and courts encourage settlement, including through Lok Adalat and mediation.
I received a notice. What should I do?
Don't ignore it. Speak to an advocate before the 15-day period ends. A timely reply or payment can change how the case unfolds.
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