Why This Matters Now
Cheque bounce cases under Section 138 of the Negotiable Instruments Act remain a major financial dispute in India. With RBI’s new 2025 guidelines, both payees and issuers must understand their rights and obligations to avoid legal consequences.
What is Cheque Bounce?
A cheque bounce occurs when a bank refuses payment due to:
- Insufficient funds
- Signature mismatch
- Account closure
- Stop payment instruction
- Alterations on cheque
Legal Consequences (Section 138 NI Act)
- Punishment: Up to 2 years imprisonment
- Fine: Up to double the cheque amount
- Both: Jail + Fine possible
Legal Steps After Cheque Bounce
- Send Legal Notice
- Must be issued within 30 days of receiving the return memo.
- Give 15 days to the issuer to pay.
- File Criminal Complaint
- If payment isn’t made, file a case in Magistrate’s Court within 30 days.
- Required documents:
✔ Original bounced cheque
✔ Bank return memo
✔ Legal notice proof
✔ Affidavit & complaint
- Civil Recovery Suit (Optional)
- File under Order 37 CPC to recover money + interest.
RBI’s New 2025 Guidelines
1. Mandatory Positive Pay for ₹5L+ Cheques
- Issuer must re-confirm cheque details (amount, date, payee) before encashment.
- Non-compliance = Cheque rejection.
2. Penalty for Repeat Offenders
- 3 bounces/year → Account downgrade or cheque book restriction.
3. SMS/Email Alerts for Dishonour
- Both drawer & payee get instant notifications.
4. Credit Score Impact
- Repeated bounces reported to CIBIL, affecting loan eligibility.
How to Protect Yourself
For Payees (Receiving Cheques)
✔ Verify cheque details before depositing
✔ Prefer NEFT/RTGS for high-value transactions
✔ Act fast – 30-day notice window is strict
For Drawers (Issuing Cheques)
✔ Ensure sufficient balance before issuing
✔ Use Positive Pay for cheques ≥ ₹5 lakhs
✔ Avoid frequent bounces to protect credit score
Need Legal Help?
Facing a cheque bounce issue? We assist with:
- Drafting legal notices
- Filing Section 138 complaints
- Recovery suits & settlement negotiations
Contact Us:
📞 +91-9878131111 | 🌐 www.makarlaws.com
📍 B S Makar, Advocate (Punjab & Haryana High Court)
Don’t delay—secure your money with legal action! ⚖️💰
Key References
🔗 RBI Positive Pay Guidelines
🔗 Negotiable Instruments Act
🔗 Section 138 Complaint Process
