# Cheque Bounce Notice (Section 138)

> If a cheque given for a debt bounces, the payee must 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, the payee can file a criminal complaint under Section 138 of the Negotiable Instruments Act within one month after those 15 days. The offence carries up to two years' imprisonment or a fine up to twice the cheque amount, or both.

Practice: Legal Documents & Agreements — https://www.industax.com/services/legal-documents/

The timelines are strict and missing one usually means losing the criminal remedy (though a civil recovery suit remains). The cheque must have been presented within its three-month validity and issued for a legally enforceable debt.

We prepare the notice through partner advocates within the deadline, track the 15-day period, and coordinate the complaint with documents in the order courts expect.

## Key facts

| Item | Detail |
| --- | --- |
| Notice | Within 30 days of the return memo |
| Drawer's time to pay | 15 days from receipt of notice |
| Complaint | Within 1 month after the 15-day period |
| Punishment | Up to 2 years and/or fine up to twice the amount |
| Cheque validity | 3 months from its date |

## Who needs this

- Businesses and individuals with bounced cheques
- Lenders and landlords
- Drawers who received a Section 138 notice

## What's included

- Notice drafting and dispatch
- Timeline tracking
- Complaint coordination through partner advocates

## Documents

- Original cheque and return memo
- Proof of the underlying debt
- Correspondence with the drawer

## Process

1. **Notice** — Demand sent within 30 days.
2. **Wait** — 15 days for payment tracked.
3. **Complain** — Complaint filed within one month if unpaid.

Work that legally requires a advocate is signed by a partner professional; Indus Tax coordinates it.

## FAQs

### What if I missed the 30-day notice deadline?

The Section 138 criminal remedy may be lost for that presentation, but the cheque can be re-presented within its validity and a fresh return memo starts a new 30-day period. A civil recovery suit is also available.

### Does a bounced security cheque count?

If the debt had become due when the cheque was presented, courts have held that a security cheque can attract Section 138.

### Can the case be settled?

Yes. Section 138 offences are compoundable, and many cases settle once the drawer pays, at any stage.

## Official sources

- India Code — central Acts: https://www.indiacode.nic.in/

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Canonical page: https://www.industax.com/services/legal-documents/cheque-bounce-notice
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.