When a cheque is dishonoured, time is critical. Advocate Kuldeep Jain brings 25+ years of experience handling Section 138 Negotiable Instruments Act matters — both prosecuting recovery claims and defending the accused — across courts in Sangrur.
Section 138 of the Negotiable Instruments Act, 1881 makes dishonour of a cheque for insufficiency of funds (or because it exceeds the arrangement) a criminal offence punishable with up to two years imprisonment and/or a fine up to twice the cheque amount. The remedy requires strict adherence to statutory timelines — a 30-day demand notice after receipt of the bank memo, and complaint filing within 30 days of the notice period expiring.
We draft and dispatch the statutory demand notice, prepare the complaint with all supporting evidence (cheque, bank memo, ledger), file before the appropriate Judicial Magistrate, and conduct trial — including examination of bank officials and accused's witnesses. Our objective is recovery of the cheque amount plus compensation, not merely conviction.
Common defences include: cheque issued as security and not in discharge of debt, absence of legally enforceable debt, material alteration, signature mismatch, and procedural lapses in notice service. We examine every document and witness to surface the right defence and have secured numerous acquittals reported in regional press.
You must send a written demand notice within 30 days of receiving the bank's dishonour memo. If payment isn't made within 15 days of the notice, you have a further 30 days to file the complaint.
Yes. Section 138 offences are compoundable. Settlement at any stage — even on appeal — is encouraged by courts and often results in withdrawal of the complaint.
The original cheque, the bank's dishonour memo, a copy of the demand notice with postal receipts, and proof of the underlying transaction (invoice, loan agreement, etc.).