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What is Cheque bounce?

It is a cheque that is not successfully converted into cash due to different reasons. Receiving a bounced cheque is a criminal offense and is punishable by law.

Documents required:

  • A cheque return memo signed by the bank
  • A written complaint.
  • An affidavit stating the facts mentioned are accurate.
  • A photocopy of documents like cheque, memo, notice copy, acknowledgment receipts, etc.

Process of Registration

  • When all the documents are received, the court issues summons.
  • The court hears the matter.
  • The defaulter is punished by a monetary penalty or imprisonment of two or more years if found guilty.
  • The bank has the right to discontinue the cheque facility and close the account of the defaulter.
  • The drawee is liable to an interim payment of 20% of the cheque amount, according to the act.

Frequently Asked Questions

  • The case must be filed in the next month, following the end of 15 days of the legal notice issued to the defaulter.
  • It is given to a person/company anticipating a decision on the final payment of a bounced cheque.
  • It is the new amendment that reduces undue delay in a bounced cheque case proceeding.