What can I do if a cheque given to me has bounced?
If a cheque given to you bounces for insufficient funds, send a written demand notice to the drawer within 30 days of receiving the bank's return memo. The drawer then has 15 days to pay. If they don't, you can file a criminal complaint under Section 138 of the Negotiable Instruments Act within one month — punishable with up to 2 years' imprisonment or a fine up to twice the cheque amount.
Cheque bounce is one of the most common legal matters in India — and one of the most deadline-sensitive. Miss a date and a strong case can die. Here is the exact sequence.
When does Section 138 apply?
- The cheque was given for a legally enforceable debt or liability (not as a gift or security in some situations)
- It was presented to the bank within 3 months of the date on the cheque
- It was returned unpaid — commonly “insufficient funds” or “payment stopped” (both can attract Section 138)
The strict timeline — every deadline matters
| Step | Deadline |
|---|---|
| 1. Present the cheque to your bank | Within 3 months of the cheque date |
| 2. Cheque returned — bank issues return memo | — |
| 3. Send written demand notice to the drawer | Within 30 days of receiving the return memo |
| 4. Drawer’s window to pay the cheque amount | 15 days from receiving your notice |
| 5. File criminal complaint in the Magistrate’s court | Within 1 month after the 15-day window ends |
A cheque can be presented again within its validity, and a fresh cause of action arises on each dishonour — but do not gamble on re-presentation if the 30-day notice window from an earlier dishonour is already running. Take advice early.
Punishment and what you can recover
- Criminal: imprisonment up to 2 years, or fine up to twice the cheque amount, or both
- Interim compensation (Section 143A): the court may order the drawer to pay you up to 20% of the cheque amount while the trial is pending
- You may also pursue a separate civil recovery suit for the underlying debt
Which court?
The complaint is filed before the Judicial Magistrate where your bank branch (the payee’s bank where the cheque was presented) is located — settled by the 2015 amendment to the NI Act.
If YOU are the one whose cheque bounced
Do not ignore the demand notice. Paying within the 15-day window closes the offence. If you dispute the debt — the cheque was stolen, given as security, or already settled — reply through a lawyer within the window and preserve your evidence.
This article is general information, not legal advice. For advice on your specific situation, consult a qualified professional.
Frequently asked questions
What is the time limit to file a cheque bounce case?
Three clocks run in sequence: present the cheque within 3 months of its date; send the demand notice within 30 days of the bank return memo; and file the complaint within 1 month after the drawer's 15-day payment window expires. Courts can condone complaint delay only for sufficient cause.
Is cheque bounce a criminal offence in India?
Yes. Dishonour of a cheque for insufficiency of funds is a criminal offence under Section 138 of the Negotiable Instruments Act, punishable with imprisonment up to 2 years or fine up to twice the cheque amount, or both. It is also compoundable — the parties can settle.
Can I get my money back during the case?
Under Section 143A, the trial court may direct interim compensation of up to 20% of the cheque amount while the case is pending, and appellate courts can order deposits under Section 148. Full recovery generally comes on conviction, settlement, or through a parallel civil suit.
What if the drawer claims the cheque was given as security?
That is a common defence, but the Supreme Court has held that even a security cheque can attract Section 138 if a legally enforceable debt existed when it was presented. The facts and paperwork decide it — advice on your specific documents matters.
How long does a cheque bounce case take?
The statute envisages summary trial within 6 months, but in practice contested cases commonly run 1–3 years. Many settle early — often right after the demand notice or at the first hearings.
