Article on dishonouring of cheque by Nishil kaushal @lexcliq





As time passes, business globalised and becomes fashionable, therefore the mode of the dealings was too progressive. Cheques, note, Bills of Exchange, etc., area unit the fashionable method of dealings.


Cheques area unit the order to the bank to pay the check holder quantity mentioned within the check from the account of the one that issued the check. Post-Dated Cheques area unit the foremost well-liked method of dealings presently.


But because the use of cheques will increase, disputes conjointly increase. Dishonoring of cheques become quite common, and courts have a surplus of those cases. Section 138 to section 142 of the instrument Act, 1881 deals with this issue, and in keeping with section 138, Dishonouring of Cheque is criminal liability.


What is Dishonour of Cheque?

When someone World Health Organisation is in a very debt provides a cheque to the soul to clear his debt, however the cheque is came back by the bank owing to the insufficiency of the fund, or as a result of the number mention on the cheque exceeds the permissible withdrawal limit from the account of the receiver is named Dishonour of Cheque or in common language Cheque Bounce.


Main Ingredient to draw in Dishonour of Cheque:

The cheque should be submitted to the bank inside a amount of six months from the date on that it’s issued, or before the ending of the cheque whichever is earlier.

After receiving the cheque back from the bank, the holder of the cheque should offer written notice to the receiver inside thirty days for the payment of the aforementioned quantity.

The receiver did not pay the aforementioned quantity inside fifteen days.


Important Legalities

It shall be probable  that the holder of the cheque received the cheque from the receiver to clear the debt of the receiver

The burden to prove the contrary to the on top of purpose lies on the one that problems the check.

The receiver on dishonouring of the cheque cannot take the defence that whereas provision a cheque he has no reason to believe that the cheque goes to be ashamed.

Law for Dishonour of Blank Cheques:

Apex Court within the case of Bir Singh v/s Mukesh Kumar clears all the doubt close the problem of Dishonour of blank cheques.


The Supreme Court dominated that:

The presumption that the holder of the cheque received the cheque from the receiver to clear the debt of the receiver is valid within the case of blank cheques additionally

A cheque won’t become invalid if it’s punctually signed by the receiver, and also the details area unit crammed by the soul.

The burden to prove the contrary to the on top of points is lies on the one that issued the check. [3]


Dishonour of Cheque by corporations

Companies area unit treated as someone they will be answerable for the offence, and may be proceeded against, and shall be penalised consequently.

Any person World Health Organisation at the time of the offence is liable for the business and management of the corporate is answerable for that offence.

If the defendant person proves that the offence took an area while not his data, or he has taken all steps to stop such offences, then he’s not answerable for penalisation

If it’s proved  that the offence materialised with the consent or the negligence of any director, manager, secretary, or alternative officers of the corporate, such director, manager, secretary or alternative officers shall even be deemed to be guilty of that offence and shall be at risk of proceed against and penalised consequently.

If the person is appointed because the Director of the corporate, that is controlled by a state or central government, then he’s not answerable for the offence.


Procedure to follow:

The check will be delivered by the holder within the bank during which he holds the account, or within the bank during which the receiver holds associate account

The grievance ought to be created inside one month when the receiver did not pay the number inside fifteen days.

The court cannot take cognisance of the case till the written grievance is created by the soul or the holder of the cheque.

Offence will be inquired and tried solely by the court in whose native jurisdiction the cheque is delivered within the bank.

Only a Metropolitan judge or a Judicial judge of the primary category or on top of will strive during this offence.



If found guilty, then there’s provision for a most of biennial imprisonment or fine, which can reach double the number of the cheque, or with each.


The court that’s hearing associate offence on matters of cheque bouncing will issue direction for the receiver to compensate concerning 2 hundredth of the number on that the cheque was created to the holder of the cheque inside a amount of sixty days of such call.


The court may direct the receiver to deposit 2 hundredth of the initial antagonistic quantity in court.


If the receiver is not guilty, the Court shall direct the plaintiff to repay to the receiver the number of interim compensation, with interest inside sixty days. The limit will be exceeded by thirty days if the court is glad by the explanation by the plaintiff.



Negotiable Instrument Act came into force in 1881, since then it develops with time and ensures the rights of the debtors and strict liability against the payment defaulters.


But at an equivalent time, it overburdens the court with cardinal Dishonour of Cheque cases once a year. And it’s a criminal offence, typically thought of a bit aggressive any from a few years, voices area unit raising to legitimatise the offence.


In 2020, the govt. of Bharat projected to legitimatise varied minor money offences for easy business and to alleviate burdened courts. Dishonouring of Cheque is among those varied offences that the govt. projected to legitimatise and raise the suggestion from the general public.

Leave a Reply


Bio Lyfe Keto Gummies (Updated Reviews) Reviews and Ingredients

Bio Lyfe Keto Gummies advance weight decline basically by stretching out inside power level through the course of thermogenesis. Thermogenesis is in addition revived by various upgrades like DHEA, caffeine and ephedrine, yet these blends reliably cause dazzling not very much organized results, for instance, hypertension. Making thermogenesis with close to no awful certain outcomes is […]

Read More

Bio Lyfe Keto Gummies Reviews (Pros and Cons) Is It Scam Or Trusted?

Bio Lyfe Keto Gummies are a reasonable extraordinary and hearty course of activity. They incorporate present day and standard adornments to address or fix logical issues. You need to kill the cannabinoids from the plant with exorbitant mind fulness. It very well might bejoined with first rate trimmings to make it extra enormous and taste better.The […]

Read More

What they told you in ‘Toy Story 2’ is a lie: This is how ‘Lightyear’ has changed this iconic moment in the saga

The true story behind Toy Story ‘s iconic space ranger has hit theaters. Lightyear , directed by Angus MacLane , tells the origins of the character that gave rise to the action figure given to Andy in the first installment of the saga. Buzz isn’t the only Toy Story character to appear in the film, […]

Read More