A bounced cheque isn’t just an inconvenience — under Indian law it can be a criminal offence. If someone’s cheque to you has bounced, or you’ve received a legal notice yourself, knowing the cheque bounce case process under Section 138 of the Negotiable Instruments Act can save you time, money, and stress. Here’s everything in plain language.
What is a cheque bounce case (Section 138 NI Act)?
When a cheque is returned unpaid by the bank — usually for “insufficient funds” — the person who issued it can be held legally liable under Section 138 of the Negotiable Instruments Act. It’s treated as a criminal offence, and the defaulter can face a fine (up to twice the cheque amount) and even imprisonment of up to two years.
Step-by-step process and timeline
- Cheque is dishonoured — the bank returns it with a memo (e.g. “insufficient funds”).
- Send a legal notice — within 30 days of the bounce, you must send a written demand notice to the defaulter.
- Wait 15 days — the defaulter gets 15 days to pay after receiving the notice.
- File the complaint — if they don’t pay, you can file a case in court within 30 days after the notice period ends.
- Court proceedings — the court issues summons, hears the matter, and passes judgment.
These deadlines are strict — miss the 30-day notice window and your case can collapse. This is exactly why acting quickly with a lawyer matters.
What the legal notice must contain
- Details of the cheque (number, date, amount, bank)
- The reason for dishonour
- A clear demand to pay within 15 days
- Reference to Section 138 of the NI Act
Cheque bounce lawyer fees in India (2026)
| Service | Typical fee |
|---|---|
| Legal notice drafting & sending | ₹1,500 – ₹5,000 |
| Filing & representing the case | ₹15,000 – ₹50,000+ |
| Consultation | ₹500 – ₹2,000 |
What if you’re the one accused?
If you’ve received a cheque bounce notice, don’t ignore it. You may have valid defences — the cheque was given as security, the amount was already paid, or the cheque was misused. A lawyer can help you respond correctly within the deadline and avoid a conviction.
Why use LexiZ.ai for a cheque bounce case
- Verified lawyers experienced in cheque bounce and recovery matters
- Fast action — critical given the strict timelines
- Transparent fees and online booking
- Confidential and secure consultations
👉 Cheque bounced or got a notice? Find a verified cheque bounce lawyer on LexiZ.ai or book a consultation today — the clock is ticking.
Common reasons a cheque bounces
Before filing, it helps to know why the bank returned the cheque. Common reasons include:
- Insufficient funds in the drawer’s account (the most common reason)
- Signature mismatch with bank records
- Overwriting or errors on the cheque
- Account closed or dormant
- Stop-payment instruction by the drawer
- Post-dated or expired (stale) cheque presented at the wrong time
- Mismatch in amount written in words and figures
Only a cheque returned for reasons like insufficient funds or a stop-payment on a valid debt typically attracts Section 138 liability.
Punishment under Section 138 NI Act
A cheque bounce is a criminal offence. On conviction, the drawer can face:
- Imprisonment for up to two years, or
- A fine of up to twice the cheque amount, or
- Both
Under Section 143A, the court can also order the drawer to pay interim compensation of up to 20% of the cheque amount during the trial — useful relief for the payee while the case is ongoing.
Nature of the offence
A Section 138 case is bailable, compoundable, and non-cognizable. In plain terms: the accused can get bail, the matter can be settled between the parties at any stage, and the police cannot register an FIR directly — it must be filed as a complaint before the Magistrate.
The court process step by step
- Filing the complaint before the Magistrate within 30 days of the notice period ending.
- Examination of the complainant and documents (cheque, return memo, notice, proof of delivery).
- Summons issued to the accused once a prima facie case is made out.
- Plea and trial — evidence and arguments are heard.
- Judgment — conviction with fine/compensation or imprisonment, or acquittal.
Most cheque bounce cases take around 12–18 months, though many settle earlier.
Where to file a cheque bounce case (jurisdiction)
After the 2015 amendment, a complaint is generally filed where the payee’s bank branch (the bank where the cheque was deposited) is located. Filing in the correct jurisdiction is essential — your lawyer confirms this before filing.
Documents required to file
- The original dishonoured cheque
- The bank’s cheque return memo
- A copy of the legal notice sent
- Proof of delivery of the notice (postal receipt / acknowledgement)
- Proof of the underlying debt or liability
Defences if you’ve been accused
If you’ve received a cheque bounce notice, you may have valid defences, such as:
- The cheque was given as security, not towards a due debt
- There was no legally enforceable debt or liability
- The cheque was misused or details were altered
- The amount was already paid by other means
- The notice was defective or not served correctly
Never ignore a notice — respond within the deadline with a lawyer’s help.
Can a cheque bounce case be settled?
Yes. Because the offence is compoundable, parties can settle at any stage — often through payment of the cheque amount with interest or a mutually agreed sum. Courts generally encourage settlement, and a lawyer can negotiate terms that protect your interests.
Real cheque bounce scenarios
Recovering a business payment
A supplier received a bounced cheque from a client. A prompt legal notice and the threat of a Section 138 case led the client to pay the full amount with interest before trial.
Defending a misused security cheque
A borrower’s blank security cheque was misused for an inflated amount. A lawyer built the defence around the lack of a corresponding debt, protecting the client.
Frequently Asked Questions
1. Is a cheque bounce a criminal offence in India?
Yes. Under Section 138 of the Negotiable Instruments Act, a bounced cheque is a criminal offence punishable with a fine and/or imprisonment up to two years.
2. What is the time limit to file a cheque bounce case?
You must send a legal notice within 30 days of the bounce, give 15 days to pay, and file the case within 30 days after the notice period ends.
3. How much does a cheque bounce lawyer cost?
Legal notice drafting costs around ₹1,500–₹5,000, while filing and representing the case typically ranges from ₹15,000–₹50,000+.
4. What if I receive a cheque bounce notice?
Don’t ignore it. Consult a lawyer immediately — you may have valid defences, but you must respond within the deadline.
5. Can I settle a cheque bounce case out of court?
Yes, many cheque bounce cases are settled through payment or compromise. A lawyer can negotiate a settlement that protects your interests.
6. What is interim compensation in a cheque bounce case?
Under Section 143A, the court can order the drawer to pay up to 20% of the cheque amount as interim compensation during the trial, even before final judgment.
7. Where should a cheque bounce case be filed?
Generally in the court where the payee’s bank branch (where the cheque was deposited) is located, as per the 2015 amendment.
8. Is a cheque bounce case bailable?
Yes. It is a bailable, compoundable, and non-cognizable offence — meaning the accused can get bail and the case can be settled between the parties.
9. What documents are needed to file a cheque bounce case?
The original cheque, bank return memo, copy of the legal notice, proof of its delivery, and proof of the underlying debt.
Disclaimer: This article is for general information only and is not legal advice. Consult a qualified lawyer for your specific situation.