FAQ’s on Section 138 Criminal Complaints
What is Cheque Bouncing under section 138 of the Negotiable Instrument Act, 1881?
Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the Bank unpaid, because of insufficient fund, such person shall deemed to have committed an offence and shall be punishable under section 138 of the Negotiable Instrument Act, 1881.
In which court do I need to file the complaint case under Section 138 N.I. Act in case drawer did not pay after receiving notice?
The place where the Complainant has its main bank operating account. Other points are not relevant as for all the Complainant it shall be the nearest place to fight and let the accused come to your place
What can I do if it has been more than 30 days since I received information of dishonour of cheque?
If the cheque is still valid i.e. 3 months from the date of the cheque you can represent the cheque again to your banker as there is no restriction regarding the number of times a cheque can be presented and that every subsequent representation and dishonour gives rise to fresh cause of action for filing complaint. It may be noted that once a notice for payment is given then the holder must file a complaint under Section 138 N.I. Act within 30 days from expiry of notice period as a fresh cause of action will not arise if the cheque is presented again and it is dishonoured and failure to file complaint will lead to loss of remedy available under Section 138 N.I. Act.
How long after notice has been served can I file a case against the drawer?
After giving notice you need to file a complaint case against drawer under Section 138 N.I. Act within 30 days from the expiry of notice period i.e. 15 days. In other words you need to file complaint case against drawer within 45 days (15+30) from the date of issue of notice. Failure to do so will lead to loss of remedy under Section 138 N.I. Act; however, you can file a summary suit for recovery of money and initiate criminal proceedings under Section 420 I.P.C. within 3 years from date of issue of cheque and or initiate MSME Arbitration proceedings
What can I do if I do not have the drawer's address?
You need the address of the drawer of cheque to issue notice as contemplated under provisions of N.I. Act; also the address is necessary if you wish to avail other legal remedies available to you. You can send the notice to the last known address. In case the address of the drawer has changed and the drawer has not left a forwarding address and the notice is returned with the noting that addressee is not available at the address or addressee has left without leaving a forwarding address then you need to file a complaint case after 15 days (notice period) of receipt of such information or returned notice and within 30 days from expiry of notice period. Failure to do so will lead to loss of remedy under Section 138 N.I. Act; however, you can file a summary suit for recovery of money and initiate criminal proceedings under Section 420 I.P.C. within 3 years from date of issue of cheque.
What should I do if the notice is returned and could not be served to the drawer?
When a notice is returned to the sender as unclaimed or with the noting that addressee is not available at the address or addressee has left without leaving a forwarding address then the date of receipt of such information or returned notice would be the commencing date for the notice period of 15 days. Complaint case under Section 138 N.I. Act must be filed within 30 days from expiry of notice period. Such reckoning would be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address or previous address.
Can The Legal Desk assist in drafting of legal notice as required by Section 138 of N.I. Act.?
Yes, The Legal Desk can assist in drafting the legal notice by section 138 of NI Act, 1881. We can also consult in the best way of recovering your dues in legal way from the payer.