A cheque given to you bounced
The 30-day deadline, the notice, the case.
Someone paid you by cheque, you deposited it, and the bank returned it unpaid. This happens often in India, and the law gives you a strong and quick way to get your money. But the deadlines are strict, so start now.
What the law says
- Deposit the cheque before it expires. A cheque is valid for six months from the date written on it, and often less. Everything below depends on this. When a cheque is dishonoured, your bank gives you a slip called a cheque return memo. It usually says "insufficient funds" or "payment stopped". That slip is your proof, so keep it safely.
- From the day the bank tells you the cheque has bounced, you have 30 days to send the person a written demand notice asking for payment. If you miss this deadline, you lose the criminal route.
- Once they receive the notice, they get 15 days to pay. If they pay, the matter ends. If they do not, you can file a criminal complaint within one month. You file it at the magistrate's court where your own bank branch is, not theirs. This is the Section 138 route.
- If you win, the court can jail the person for up to 2 years. It can also order them to pay you up to twice the cheque amount. It can do both. You can also file a separate civil recovery suit to get the money itself.
What to do
- 1
Collect the bounce memo and the cheque
Get the cheque return memo from your bank and keep the bounced cheque. Note the date on the memo. Your 30 days to send the demand notice starts from that date. The deadlines after that run from a different date: the day the other side receives your notice.
- 2
Send a written demand notice within 30 days
Send a formal notice by registered post. Tell the person their cheque bounced and ask them to pay the full amount within 15 days. The law fixes that 15-day period, so you cannot make it shorter or longer. Keep the postal receipt, because the deadlines after this run from the day they receive the notice. This step is compulsory. Without it you cannot go to court on the criminal route.
- 3
Wait 15 days for payment
Give them the 15 days the law allows. Many people pay at this stage to avoid a case. If they pay, you are done. If they stay silent or refuse, you can now file.
- 4
File the complaint within one month
If they have not paid, file a cheque bounce complaint within one month of the 15-day period ending, at the magistrate's court where your own bank branch is. If you are late, the court can still take the case if you satisfy it that you had a good reason, but do not depend on that. Carry the cheque, the return memo, your notice and the postal receipt. You can also start a civil suit to recover the money.
Your rights
Deposit the cheque and get a return memo
- How long it takes
- Before the cheque expires. 6 months at the outside.
- Where to go
- Your own bank
- Cost
- Free. Sometimes a small bounce charge.
Send the demand notice
- How long it takes
- Within 30 days of the bank telling you
- Where to go
- Yourself, a lawyer, or Miss Lucy Lite to write it
- Cost
- Free if you write it yourself
File the criminal complaint (Section 138)
- How long it takes
- Within one month after the 15-day wait. Later, with a good reason.
- Where to go
- Magistrate's court where your bank branch is
- Cost
- Court fee + lawyer
File a civil recovery suit for the money
- How long it takes
- Several months
- Where to go
- Civil court
- Cost
- Court fee + lawyer
Common questions
When you need a lawyer
The demand notice has to be worded and dated correctly, and the deadlines are strict. Getting it right at the start matters. Miss Lucy Lite can write that legal notice for you. A local advocate then files the complaint and handles the court hearings. For anything above a few thousand rupees, it is worth having both.
Miss Lucy Lite can write the demand notice for youThis is guidance, not a lawyer. Miss Lucy Lite helps you understand your rights and what to do next. She is not a lawyer, and this is not legal advice. If you need a document written, such as a notice, a complaint or an application, she can write it for you as a finished document. For a court case, see a lawyer.