DETAILED VIEW ON HOW TO FILE A CASE AGAINST CHEQUE BOUNCE IN INDIA:
Cheque bounce is a criminal offence under The Negotiable Instruments Act which deals with the subject of cheque bouncing, Cheque dishonor or Cheque return matters. Cheque bouncing happens when a person has issued a Cheque without maintaining sufficient amount in his account as a result of the same when the Cheque is presented for encashment; the same is returned by the bank unpaid which is termed as bouncing of Cheque. The law related to bouncing of Cheque is contained in The Negotiable Instruments Act and a specific provision under Section 138 of the Negotiable Instruments Act has been made to deal with bouncing of Cheque besides the provisions under the IPC and the Code of Criminal Procedure of 1973. The case of cheque bouncing is tried as a summary trial case before the court of Magistrate under the Criminal Procedure Code of 1973.
STEPS INVOLVED TOWARDS FILING THE CASE:
Notice is the first step of how to file case against cheque bouncing. Notice against bouncing of Cheque is to be issued within one month of the date of return of the Cheque by the bankers. Service of notice on the person issuing the Cheque is mandatory; the mode of service of notice can be any recorded delivery which is admitted as evidence under the Indian Evidence Act.Notice should be sent by Registered AD., Speed Post only. The purpose of making such provision is to make the person issuing the Cheque aware about the fact that the Cheque issued by him has been returned by his bankers due to insufficiency of funds in the account and he has to make arrangement for the amount within the stipulated period and intimate the banker as well as the person to whom the Cheque has been given by him.
STEP-II: LODGING A COMPLAINT:
The filing of the complaint is the second important stage of how to file case against cheque bounce and should be done carefully through a highly qualified lawyer. The complaint is to be filed before the magistrate of the area concerned within 30 days from the date of dispatch of notice under Section 138 of the Negotiable Instruments Act.
STEP-III : NOTICE ISSUED TO THE ACCUSED:
The court issues notice to the accused person or the person who has issued the cheque after filing of the complaint and the said person is required to appear before the court and seek bail from the court and contest the matter if any friable issue is raised by him.
STEP-IV: PRIMARY EVIDENCE:
The evidence in support of the complaint is the cheque, the memo issued by the bank and the record showing the service of notice on the person who has issued the cheque and all other relevant documents in support of the matter which can prove that the accused is under legal obligation to pay the amount under the bounced cheque.
STEP-V: TRAIL PROCESS:
The process of trial for cases under Section 138 of the NI Act is summary and the court has to take into consideration the records furnished by the complainant and the evidence in support. The complainant is asked to lead his evidence during which he summons the records from the bank related to the cheque . The accused is given the opportunity to cross examine . The accused is thereafter asked to lead his evidence and rebut the allegations against him.
The court then proceeds to dispose off the matter on the merits and accordingly arguments on all issues are head and the matter is decided accordingly.
The punishment as contained under Section 138 of the NI Act which is two years and a penalty of the amount equal to two times of the amount as mentioned on the cheque.
ATTENTION: As per the latest judgment of Supreme Court, all cases filed under Negotiable Instruments Act for bouncing of cheques can only be filed within the territorial jurisdiction of the courts where the drawee bank is located. This limits the jurisdiction of filing of the cases against bouncing of cheques at all other places other than the drawee’s branch of bank.