More

Cheque Bounce and its Procedures

A cheque could be a medium of exchange that promotes cashless transactions in a degree economy. The utilization of cheques as a medium of exchange has exaggerated with time. Folks like better to offer cheques in transactions, rather than carrying currencies. Carrying currencies, particularly once the number is simply too giant, could be a risky business.

INTRODUCTION

A cheque could be a medium of exchange that promotes cashless transactions in a degree economy. The utilization of cheques as a medium of exchange has exaggerated with time. Folks like better to offer cheques in transactions, rather than carrying currencies. Carrying currencies, particularly once the number is simply too giant, could be a risky business. Since cheques are mere paper issued by the bank authority to form payments, it, therefore, becomes convenient thanks to performing transactions because the probability of prevalence of thieving or being robbed reduces.

CHEQUE

A Cheque is a crucial part of the national economy in numerous countries across the globe. A cheque is thought to be a crucial document that might be utilized by a private, company or government for transactions of assorted amounts. A Cheque is additionally termed as a negotiable document to move cash in an exceedingly physical kind or maybe to perform the inter-account transfer.

CHEQUE BOUNCE

The situation of cheque bounce means the method of depositing cheques within the bank has been unsuccessful.
It might ensue too many reasons:

  • When there are lean funds within the account of the establishment. it’s thus suggested to bear in mind and careful whereas issue a cheque to make sure that there’s a comfortable balance within the account of the establishment
  • When the date mentioned on the cheque is ugly or once the numbers are scribbled or maybe if the date on the cheque is three months previous from this date, then the bank will bounce the cheque.
  • When the signature doesn’t match with the bank’s records.
  • When there’s a distinction within the amounts mentioned in numbers and words.
  • When the cheque has several stains or marks.
  • When there’s overwriting, scribbling, or correction on a cheque.

Time and title of respect in the Hon’ble Supreme Court of

Bharat and numerous high courts have emphasized the expedition of 138 cases and also the completion of the trial within the time sure manner. Within the celebrated case of J.V. Baharuni and Ors. vs. the State of Gujarat and Ors. The Hon’ble Supreme Court had issued numerous tips and among them two (two) are value to be declared down.

The courts should try and expedite the cases in an exceedingly time sure manner and restore the arrogance of the mortal within the judiciary; and

The magistrates should encourage the change of integrity of the offense as earliest. In 138 cases, restitution should be prioritized against the retaliatory part of the social control.

In Goa Plast (P) Ltd. v. Chico Ursula D’Souza, the Hon’ble Supreme Court has discovered that the item of the statute was to facilitate the swish functioning of the business transactions. The supply is important as in several transactions because the cheques were issued simply as a tool to mulct the creditors. Dishonour of the cheque causes uncounted loss, injury, and inconvenience to the receiver, and believability of business transactions suffers a black eye.

On the opposite occasion, the Hon’ble Supreme Court within the case of Dilip S. Dhanukar vs. Kotak Mahindra Co. Ltd. and Ors had declared that the punishment/ prosecution in 138 cases provides deterrence, however identical can’t be used as a life of ill-treatment. Moreover, the Hon’ble Supreme Court has taken suo moto action within the case of Makwana Mangaldas Tulsidas vs. The State of Gujarat and Anr to explore the chances to form the cheque bounce cases additional prompt. The case continues to be unfinished before the Hon’ble Court and solely fate will apprise the U.S.A. however the Hon’ble Court goes to handle such a frightening task.

Some vital measures to require once a state of affairs of false cheque bounce arises

  • Collecting all the vital documents:

The most wise and sensible factor to try to to once there’s any false accusation to someone is to gather proof which is able to show him guilty of the charge placed on him. Similarly, this case isn’t any totally different and aggregation the relevant documents which might prove American state innocent and also the bank guilty

  • Contact the bank and collect info concerning the dishonour of cheque:

If your cheque bounces, the bank would send you notice informing you of identical. you’ve got to then contact them and make sure if it’s very happened and if it did what ar the explanations.

  • Hire a professional person and reply to the legal notice of the bank:

It is tough to draft a legal notice and you ought to not take it gently as a result of once the notice is written and sent, you’d not be able to amendment its content and need to persist with it. You’d not be able to go against the statement written by you in your notice. Thus you want to seek advice from a professional person World Health Organization deals with cheque bounce cases and reply to the notice regarding the cheque bounce case that you’d have gotten from the check receiver. The reply ought to be sent at intervals thirty days of receiving the notice. In several such cases of fraud and false accusation, the case is withdrawn once a legal notice is distributed.

  • File a counter case:

You are de jure allowed to file a counter civil case against the one who has filed a false cheque bounce against you. You’ll be able to claim compensation for the false accusation. You’ll be able to conjointly claim the compensation for all the damages and expenses that you may have incurred for coping with the fraud case with the bank. you’ll be able to conjointly file a defamation case against the false disputant.

Essential Documents for filing complaint

Under Section 142 of the Negotiable Instruments Act, 1881, there’s just one eligibility demand for filing a criticism which is, the criticism is filed by the recipient or the holder in due course. The litigator ought to be a corporeal person, capable of constructing a physical look within the court.

Basic documents needed for filing complaint

  • The criticism ought to be filed beneath Section 138 of the Negotiable Instruments Act, 1881, containing a top level view of the facts.
  • There is additionally a demand for pre-summoning proof by manner of legal document.
  • At the time of filing the criticism, the litigator ought to manufacture an inventory of witnesses.
  • All the documents essential to the case ought to be submitted beside the list of the documents being submitted.
  • At the time of filing the criticism, the consumer ought to relinquishment a Vakalatnama in favour of his counsel that is to empower the advocate to act on behalf of his consumer.
  • The notice of demand (legal notice issued by the recipient to the drawer beneath Section 138) beside the initial cheque come back note must be bestowed with the criticism.
    How to initiate the case underneath the section
  • After the cheque has bounced, the receiver would warn the drawer of the cheque that he would initiate a continuing underneath the N.I. Act, if the drawer doesn’t clear the payment at intervals an amount of fifteen days from the date of receipt of legal notice.
  • In case drawer doesn’t build the payment at intervals these fifteen days, then the receiver is entitled to initiate criticism proceedings underneath Section 138 of the N.I. Act at intervals one month of the tip of such amount.
    There exists no format for drafting such notices, because it is simply to tell the drawer that a case is being filed against him for creating a default payment.
    The constituents of the demand notice would be:
  • A statement instructive that the cheque was given to the bank at intervals its validity amount (3 months).
  • Statement describing the debt and therefore the circumstances encompassing the style of acquisition such debt.
  • The demand notice ought to conjointly contain all the data concerning the dishonoured cheque, like why it absolutely was dishonoured, etc.
  • The total of cash that the drawer has to pay at intervals fifteen days of receiving such notice.

Court Fees

There exists no blanket provision for court fees across states. The completely different states charge different court fees. The fees that the court charges isn’t abundant in such cases. It is relying upon the number declared within the cheque, the court fees might vary. In Delhi, the court fees for cheque bounce matters is simply Rs two, that a court stamp is needed to be applied to the criticism.

*****

Disclaimer: The entire content of the note has been prepared in accordance with the applicable laws. The author has taken all the remedial measures to ensure accuracy completeness and reliability of the information provided. The author accepts no accountability identifying with the note. The reader is required to refer the important existing provisions of applicable laws. The reader agrees that information gave in the above note isn’t Professional advice and is liable to change without notice by author. The user accepts no accountability for the result of utilization of such data. This note is only for sharing the information for common advantages.

Categories: Finance