A cheque bounces when a nationalized/private/co-operative bank doesn’t honour the payment. The reasons could be such as the wrong signature of the person who’s issued the cheque/there’s a mismatch of figures written on the cheque between the words and figures/ some kind of overwriting on the cheque. Such issues are minor and can be solved without the court’s intervention, But, when a cheque bounces due to lack of funds in the drawing party’s account it becomes a legal matter.

A cheque bounce is governed by the Section 138 of the Negotiable instruments Act, 1881.

If an individual has received a cheque that has bounced, they have two options available to them.

  • The individual can send this said person a notice
  • If there is no reply to this notice after 15 days, the individual can send this said person a legal notice, by filing a complaint in court


  • The first step in a cheque bounce case is to send a Demand Notice to the individual who has issued the bounced cheque
  • This notice must contain all the relevant details about the bounced cheque, such as the date when the cheque was issued, a copy of the dishonored memo must also be mentioned in the notice
  • Once the guilty party receives the notice, he or she has 15 days to make the payment to the individual. If they fail to do so, an individual can file a complaint with the court in the prescribed format
  • It is better to take the help of a legal expert from ACE ALLIANCE to file a complaint. Our team of legal experts at ACE ALLIANCE are familiar with the process and will help you fill up the form using the correct legal language
  • Along with the complaint form, an individual has to submit an Oath Letter, A copy of the notice is served along with the acknowledgement receipt/a photocopy of the memo and the bounced cheque received
  • Once the judicial court receives an individual’s complaint, it will go through the documents and verify them. Once the court is satisfied with the complaint, the complainant or his or her lawyers have to fill up the Bhatta or Process Form. Once this is done the accused party is summoned for a court hearing. If the accused doesn’t appear in court, the judge can issue a bailable warrant against the concerned person.


As per the terms of the Negotiable Instruments Act, 1881, under section 138, the issue of a bounced cheque is considered a criminal offense. Once a complaint is filed in a court, the guilty individual can be jailed/ or may have to pay a huge fine. The fine amount can be two times the original amount that was to be paid. If the court decides to send the guilty party to jail, it is usually for a period of one term, but can be extended upto two years. In some cases, the court may grant both the punishments. This is done if the court finds the case to be a heinous crime. In some cases, the court may grant additional time to pay the pending dues.


  • The copy of the Demand Notice along with the acknowledgement of the receiver
  • The original cheque that had bounced
  • The official cheque return memo from the bank that states the cheque has been dishonoured / the reasons for that


When an individual files a cheque bounce case, there are certain rules he or she has to adhere to.

  • The first step is to send a Demand Notice to the offending party. Once that notice has been received, the guilty party has 15 days to make the due payment. As per Section 138 of the Negotiable Instruments Act, 1881, the payee must send the drawer a notice within 30 days of receiving the Cheque Return Memo
  • If the drawer fails to make the payment, then the person filling the cheque bounce case can file a complaint with the court. This is done by the submission of a written complaint along with the requisite documents
  • The main document needed to file a complaint in the court is the Cheque Return Memo from the payee’s bank. This document is needed by the court to proceed with the case
  • If the bounced cheque was issued as a gift/or as a loan payment, the defaulter will not be prosecuted in the eyes of the law


A cheque bounce notice is governed by the Section 138 of the Negotiable instruments Act, 1881. This notice is sent to the drawer in case the cheque bounces due to lack of funds. This notice is followed up by a legal notice if the need arises

Our team of legal and tax at ACE ALLIANCE will explain the legal options that are available to you, the whole process including the time frame to act against the guilty party.  Our team of lawyers will prepare and send a demand notice to the bounced cheque drawer. If there is no response to the notice within15 days, the lawyers will draft a complaint against the drawer of the bounced cheque.