Quick answerWhen a cheque given for a debt is returned unpaid, the payee must send a written demand notice within 30 days of receiving the bank's return memo. If the drawer does not pay within 15 days of receiving the notice, a criminal complaint under Section 138 of the Negotiable Instruments Act can be filed within the next one month. The offence is punishable with up to two years' imprisonment, a fine up to twice the cheque amount, or both.
- Law
- Sections 138 to 148, NI Act 1881
- Notice deadline
- 30 days from return memo
- Complaint deadline
- 1 month after the 15-day period
- Where to file
- Court where your bank branch is
When does a bounced cheque become a criminal case?
Not every returned cheque is an offence. Section 138 applies when all of these are true:
- The cheque was given to discharge a legally enforceable debt or liability, in whole or in part. A cheque given as a gift or a donation does not qualify.
- It was presented to the bank within its validity, which is three months from the date written on it.
- It was returned unpaid for insufficient funds, or because it exceeded the arrangement with the bank. Courts have held that "account closed", "payment stopped by drawer" and "signature differs" returns can also attract Section 138 where the drawer did this to avoid payment.
- The payee sent a written demand notice within 30 days of learning of the return, and the drawer failed to pay within 15 days of receiving it.
The law presumes, under Section 139, that the cheque was issued for a debt. The accused can rebut this, for example by showing the cheque was a blank security cheque for a liability that never arose. Since the Supreme Court's decision in Sripati Singh v. State of Jharkhand (2021), a security cheque presented after the loan fell due can still found a Section 138 case.
The deadlines you cannot miss
| Step | Time limit | What happens if you miss it |
|---|
| Present the cheque | Within 3 months of its date | No Section 138 case; only a civil suit |
| Send demand notice | 30 days from receiving the return memo | Fatal to the complaint; you may re-present within validity and start again |
| Drawer pays | 15 days from receiving the notice | If paid, the matter ends |
| File the complaint | Within 1 month after the 15 days end | The court can condone delay only for sufficient cause |
Keep the original cheque, the bank's return memo, a copy of the notice and the postal receipts and tracking report. These are the documents the court asks for first.
How a cheque bounce case proceeds in court
The complaint is filed in the court of the Judicial Magistrate where the payee's bank branch is situated, as provided in Section 142(2). The complainant files an affidavit of evidence, and the court issues summons to the accused if a case is made out. Cheque cases are tried summarily under Section 143, which shortens the trial.
On the accused's first appearance, the court may order interim compensation of up to 20% of the cheque amount under Section 143A, payable within 60 days. If the accused is convicted and appeals, the appellate court can require a deposit of at least 20% of the fine or compensation under Section 148. These provisions are often what bring a drawer to settle.
The offence is compoundable under Section 147, so the parties can settle at any stage. Settling early costs less: the Supreme Court's guidelines in Damodar S. Prabhu allow the court to impose costs that increase as the case moves to higher courts.
Criminal complaint, civil suit or both
A Section 138 case punishes non-payment and puts pressure on the drawer, but recovering the money may also need a civil remedy. A summary suit under Order XXXVII of the Civil Procedure Code can be filed on the cheque within three years, and the defendant cannot defend without the court's leave. Many of our clients run both: the criminal case for pressure and the civil suit for a decree that can be executed against bank accounts and property.
Where the drawer is a company, the directors in charge of its business at the time can also be made accused under Section 141, provided the complaint specifically says how they were responsible.
If you are the accused
Receiving summons in a cheque case is serious but rarely hopeless. The usual defences are that there was no enforceable debt, that the amount was already paid, that the cheque was a security cheque for a liability that did not arise, that the notice was defective or not received, or that the complaint was filed out of time or in the wrong court. Many cases are best resolved by a structured settlement before evidence.
You must appear in court and furnish bail when summoned. Ignoring summons leads to bailable and then non-bailable warrants. If you live in another city, we can seek exemption from personal appearance after the first date.
Mistakes that lose cheque bounce cases
Most failed Section 138 complaints fail on procedure, not on the merits. The errors we see most often are:
- A notice that demands the wrong amount. The notice must demand the cheque amount. Adding interest or other dues is allowed only if the cheque amount is stated separately and clearly.
- Counting the 30 days from the wrong date. The period runs from when you receive information of dishonour from the bank, so keep the return memo with its date.
- Filing too early or too late. A complaint filed before the 15-day payment period ends is premature; one filed after the one-month window needs a separate application to condone delay.
- No proof of the debt. The presumption helps, but invoices, agreements, ledger entries and messages make the case far stronger when the accused contests it.
- Not naming the company. Where a company issued the cheque, the company itself must be an accused before its directors can be prosecuted.
- Accepting a part payment without a written settlement. Record every settlement in writing, with what happens if instalments are missed.
What a cheque bounce case costs
Court fee on a Section 138 complaint is fixed by each state and is usually modest. Professional fees depend on the cheque amount, the court and whether you are the complainant or the accused. We quote a fixed fee for the notice, and a stage-wise fee for the complaint (filing, summons, evidence, arguments), in writing before we start.
Documents you need
For a complaint, bring originals or clear copies of the following. If you are the accused, bring the summons and complaint copy.
- Original dishonoured cheque
- Bank return memo with the reason for return
- Proof of the debt: invoice, loan agreement, ledger, WhatsApp or email messages
- Copy of the demand notice and postal receipts or courier proof
- Tracking report or returned envelope
- Your ID and address proof, and board resolution if the payee is a company
How we handle it for you
Check the deadlines
We read the return memo date and confirm the notice and complaint windows the same day.
Send a proper demand notice
Drafted with the cheque details, the debt and a clear 15-day demand, sent by registered post and email.
File the complaint
Complaint, affidavit of evidence and documents filed in the correct court within the limitation period.
Press for interim compensation
We apply under Section 143A once the accused appears.
Settle or argue
We negotiate a structured settlement where possible, and take the case to judgment where it is not.
Why clients choose ProudLegal
Advocates who appear in courtYour matter is drafted and argued by enrolled advocates, not call-centre staff.
Company and tax filings in-houseCompany secretaries and tax professionals handle registrations and returns.
Fees agreed in writingYou receive a written fee quote before any work begins.
Updates on WhatsApp and emailEvery hearing date, filing and document is shared as it happens.
Please note: this page explains the law and procedure in general terms as on 30 October 2026. Fees, limits and timelines change, and the facts of each case matter, so take advice on your own papers before acting.
Frequently asked questions
Is cheque bounce a criminal offence in India?
Yes. Under Section 138 of the Negotiable Instruments Act, dishonour of a cheque given for a debt is an offence punishable with up to two years' imprisonment, a fine up to twice the cheque amount, or both, once the notice procedure has been followed.
How many days do I have to send a legal notice?
The notice must be sent within 30 days of receiving the bank's return memo. The drawer then has 15 days from receipt of the notice to pay.
Can a security cheque lead to a Section 138 case?
It can, if the liability it secured had become due when the cheque was presented. If no debt was outstanding, that is a valid defence.
Where should the complaint be filed?
In the court of the Magistrate within whose jurisdiction the branch of the payee's bank, where the cheque was deposited, is situated.
How long does a cheque bounce case take?
It varies widely by court. Many cases settle within a few months of the accused's first appearance; contested cases can take one to three years.
What is interim compensation in a cheque bounce case?
Under Section 143A the court can order the accused to pay up to 20% of the cheque amount to the complainant while the case is pending. It is refundable with interest if the accused is acquitted.
Can the case be settled after filing?
Yes. The offence is compoundable at any stage, with the court's permission at later stages, and costs increase the later the settlement comes.
Can I send the notice by WhatsApp or email?
Registered post with proof of delivery remains the safest. Notices by email or WhatsApp have been accepted where delivery is proved, so we send by both.
