The offense of dishonor or bouncing of cheque occurs if the drawer fails to make payment against dishonored cheque within 15 days of demand raised by the payee by way of demand notice. The demand notice is to be served by the payee within 30 days of dishonor of cheque. In case the drawer fails to make payment within 15 days, a complaint under Section 138 of the Negotiable Instruments Act, 1881 can be filed against the drawer of the cheque.
As per Indian Law, the dishonor or bouncing of cheque is tried as a criminal offense, though it creates civil liability as well. In the event of offence being proved there can be imprisonment for up to two years, as well as monetary penalty up to double the amount of dishonored cheque.
Dishonor of cheque can happen in case of an insufficient funds, in the account of the drawer. It can happen also when the drawer issues cheque on a closed account and no functioning of account due to certain reasons.
Our team is thorough about handling the dishonor of cheques and we have a very successful record of providing justice to the aggrieved payees who suffered financial losses due to dishonor of cheques.