Section 138 Notice

WHEN ANY CHEQUE HAS BEEN PRESENTED IN THE BANK FOR ANY PAYMENT AND THEREAFTER THE CHEQUE IS RETURNED UNPAID, THEN THE CHEQUE WILL BE CALLED AS DISHONOURED OR BOUNCED.

THERE ARE MANY REASONS OF BOUNCED OR DISHONOURED CHEQUES:-

1)INSUFFICIENT FUND IN BANK ACCOUNT FOR CLEARING THAT CHEQUE.

2)POST DATED CHEQUE.

3)SIGNATURES ARE MISMATCHED OF THE CHEQUE PAYER.

4)OVERWRITING IN CHEQUE.

5)AMOUNT AND FIGURES OF CHEQUE ARE MISMATCHED.

6)CHEQUE IS OLD MORE THAN THREE MONTHS FROM ISSUING DATE.

7)DATE IS NOT CORRECTLY MENTIONED IN THE CHEQUE.

8) CHEQUE IS NOT IN A PROPER CONDITION MEANS CHEQUE IS DAMAGED OR BURSTS.

NON-PAYMENT OF CHEQUE OR DISHONOUR OF CHEQUE OR CHEQUE BOUNCE IS A VERY SERIOUS OFFENCE IN INDIAN LAWS AND IT IS GOVERNED BY THE NEGOTIABLE INSTRUMENTS ACT .IN THIS ACT A SPECIFIC SECTION WHICH IS SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT DEAL WITH THIS ISSUE OF CHEQUE BOUNCE..THERE IS A PRESCRIBED PUNISHMENT WITH IMPRISONMENT OR FINE HAS BEEN DESCRIBED UNDER THE SPECIFIC SECTION WHICH DEAL WITH THIS ISSUE THAT IS SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT.

WHEN ANY CHEQUE IS BOUNCED OR IS DISHONOURED BY THE BANK DUE TO ANY REASON , THE PERSON WHO IS BENEFICIARY OF CHEQUE HAVE TO PRESENT THE ISSUER OF CHEQUE A CHEQUE BOUNCE NOTICE UNDER SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT WITHIN THIRTY DAYS OF RETURNING OF CHEQUE TO PRESERVE OR PROTECT THEIR RIGHTS UNDER THE ACT OF NEGOTIABLE INSTRUMENT.

NOTICE OF CHEQUE BOUNCE ISSUED UNDER THIS SECTION 138 OF NEGOTIABLE INSTRUMENT ACT IS A SERIOUS AND FINAL INTIMATION TO THE ISSUER OF CHEQUE THAT THE BENEFICIARY OF CHEQUE WILL PROCEED WITH LEGAL ACTION OR LITIGATION IF PAYMENT OF THEIR CHEQUE IS NOT MADE IMMEDIATELY.

NOTICE OF CHEQUE BOUNCE MUST CONTAIN SOME IMPORTANT INFORMATIONS:-

  • PROVISIONS OF SECTION 138 OF THE NEGOTIABLE INSTRUMENTS ACT.
  • DATE OF CHEQUE PRESENTED.
  • REASON OF NON –REALIZATION OF PAYMENT
  • REQUEST FOR IMMEDIATE PAYMENT BY ANY OTHER ALTERNATE MEANS
  • TIME LIMIT OF PAYMENT

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