Cheque Bounce Police Complaint? - All Doubts Solved Here

September 21, 2022, 11:31 am | Updated June 6, 2023, 10:55 am IST
Cheque Bounce Police Complaint? - All Doubts Solved Here
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I will not pay a single penny, do whatever you want to do………I will sue you……I will see you in court……I will make sure to get you behind the bars. Harsh words, but very common in case of money related disputes. Giving and taking payments through cheques is too common in Indian businesses. But since it is not a direct currency but another negotiable instrument, a document which in a way promises a later payment, things often lack a sense of confirmation. To give a sense of security to persons receiving monetary transactions through cheque, Section 138 of Negotiable Instruments Act was brought in. It provides a pathway to follow if payment through cheque sticks midway. What happens if cheque bounces in India? More importantly, can I file police complaint for cheque? Find out here on this page.


How to File Police Complaint for Cheque Bounce?

If a person receives a cheque which has been returned by the bank due to insufficient funds, a legal notice has to be served to the drawer of the cheque within cheque bounce case time limit. If payment is not made within the deadline given through that notice, the cause of action starts. Such an aggrieved person in whose favour the said cheque was drawn may proceed legally, provided that the cheque bounce facts comply with the requirements provided under Section 138 of Negotiable Instruments Act, 1881.

It should be noted that although new rules for cheque bounce in India are criminal in nature, however, a person does not file a cheque bounce police complaint. Complaint under 138 NI Act, 1881 has to be registered with the magistrate of appropriate jurisdiction. Even if a person approaches with a sample police complaint letter for cheque bounce, the officials may enter into their diary entry and refer the same to the concerned magistrate. Thus, if people think that a bounced cheque may bring them behind the bars overnight, it is not correct. Even if the payee (person in whose favour the cheque was drawn) or the authorities are harassing the drawer of arrest, nobody can arrest in a cheque bounce police complaint unless there is some other serious allegation. If matter is proved before the court regarding default in payment through cheque and person is not paying the sum, imprisonment can not be avoided in such case.


Section 420 in Cheque Bounce

The provision of cheque bounce under Section 138 of NI Act specifically deals with dishonour of cheque due to insufficiency of funds and even courts support repayment over imprisonment. But if the complainant is a victim of cheating due to the drawer's deceiving action, in such cases the process may take a turn. Provisions like cheating (u/s 420 of Indian Penal Code, 1860), criminal breach of trust (u/s 406 of IPC) may be invoked with confirmation from cheque bounce lawyers. This can be understood with an example. If a person issues a post-dated cheque, nobody knows what may come in the future and some financial stress may hit. However, there is another scenario whereby a person is drawing a cheque that is supposed to go for encashment immediately, some valuable goods are taken by convincing on the same lines, and the same is dishonoured. Ill intention of the drawer can be deduced initially to deceive the other person. Here, the payee has been cheated upon by establishing a trustworthy business relation. In such cases, a cheque bounce police complaint is lodged under Sections 420 and 406 along with section 138 NI Act.


Cheque Bounce - Cheating and Double Jeopardy

The concept of double jeopardy is that a person should not undergo legal trial/ prosecution twice for one particular act/ offence. Article 20 (2) of the Constitution of India prohibits the practice and the person has fundamental right against the same. The question herey arises whether section 420 in cheque bounce of 138 of NI Act causes double jeopardy?

The answer is provided recently by Karnataka High Court in case of Rashmi Tandon[1] and even the Gujarat High Court in Sangeeta Ben Patel case[2]. The hon'ble High Courts have clarified that registration of criminal cases under Section 406, 420 of Indian Penal Code, 1860 is not barred in the name of double jeopardy. The essence is that under Section 138 of Negotiable Instruments Act, 1881, a guilty mind is not essential. Even if a person mistakenly drew a cheque that got dishonoured and is unable to pay off the amount for the time being, legal proceedings may be invoked. However, if all of this happens through deceiving the other person into believing that there is sufficient amount in the account and benefits were fetched on that note, it becomes a rather punishable offence. Thus, a cheque bounce police complaint will by no means become a case of double jeopardy in such cases.

FAQs around Cheque Bounce Police Complaint


Q- Can FIR be lodged for cheque bounce?

A- An FIR or first information report can be filed under Section 154 of Code of Criminal Procedure, 1973 for offences which are serious in nature allowing the police to arrest without a warrant. Registration of FIR is not usually done in the usual event of facts in cheque bounce cases. However, facts of cases vary and it might become a serious offence with cheating, robbery, etc. whereby the police might be required to register the same under Section 154 of CrPC 1973


Q- Can police take action on cheque bounce?

A- If it is only a case dishonour of cheque section 138, police may not even register a complaint or refer the matter to the magistrate for criminal complaint. In cases of cheque bounce, police normally come into picture if the defendant (drawer of cheque who owes the payment to complainant) is avoiding the court and non-bailable warrants have been issued. To ensure the defendant's presence during proceedings in such a case, police officials are required.


Q- What is the time limit to file a cheque bounce case?

A- Ordinary people are often confused over how to complain for cheque bounce. If I have received a bounced cheque in a particular jurisdiction, I need to contact banking lawyers near me to serve the drawer of that cheque with a legal notice in this regard within 30 days of dishonour. Through the notice, another 15 days are given to reply to the notice and pay the requisite amount. Within 30 days of the expiry of the 15 day notice period, police complaint may be lodged to initiate court proceedings.


Q- How do you take legal action on a bounced cheque?

A- The cheque bounce case procedure in India begins with bounced cheque due to insufficient funds in the drawer’s account which was drawn in furtherance of a legal liability. The person is supposed to serve a legal notice to the drawer in this regard giving him a deadline to repay the amount. At the end of such a period, a cheque bounce police complaint may be lodged. Additional provisions like cheating section 420 in cheque bounce may be invoked if facts of the case allow so.


[1] Rashmi Tandon and Anr. v. State of Karnataka (Criminal Petition No. 6638 of 2021).

[2] Sangeeta Ben Patel v. State of Gujarat (2012) 7 SCC 621.

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Dear sir, My answers are as follows: 1)What is better: to file two separate complaints or one combined complaint for cheque bounce u/s 138 NIA and 420 IPC? What are pros and cons of both? Ans: Only one complaint can be file under section 138 2) Is it mandatory to first file police complaint under sec 420 IPC and only if it rejects to take it then and then only one can approach the court of law? or one can directly complain to the court? Can one directly file a private complaint case to the court instead of requesting it to order the police to register the FIR under CrPC? Ans. Normally when 138 is made out complaint under section 420 may not be registered but it is not general rule. 3) If an FIR is filed with police for cheating, can the complainant hire a private lawyer instead of or in addition to public prosecutor? Ans: With great difficulty. 4) What's better in case of sec 420 IPC complaint in cheque bounce: to file FIR with police and leave it up to the state or file private complaint in the court and hire a private lawyer? Ans: to leave to the State to take the issue. 5)Should one file a criminal case u/s 420 IPC after he loses the 138 NIA battle? Will it make any sense? Ans: only when there is separate material. 6) What legal action can be taken by the accused against a complainant who lost the case in the court of law for cheating u/s 420 IPC for cheque bounce and 138 NIA? What can be the punishments? Ans: Upto 7 years for 420 and upto 1 year for 138 7) Can one file recovery suit in the civil court and consumer forum simultaneously in a cheque dishonour case? Or only either of the two? Ans: yes, it is better to get interest. 8) If criminal court orders two times fine to the accused u/s 138 NIA, is the amount given to the complainant? If it is given to him can he also get the amount once more from a civil recovery suit won? And also from consumer forum the third time if simultaneous CPA & CPC proceedings are allowed? Will it not be an injustice to the accused? Ans: It will be adjusted in civil suit. 9) Is it necessary for the complainant to mention in every complaint details of other fora or courts in which he has filed complaints before this for the same same cause of action and current status of those cases i.e. pending, lost or won etc? Ans: Yes, it is better. For full procedure contact me on mobile through Vidhikarya. Rate me Five Star * Please visit the following link.
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Good Eve Teja, After reading the above instances you've mentioned, I am of opinion that you have a very strong case u/s 138 of Negotiable Instruments Act and you also may proceed parallelly with 420 IPC Fraud at JMFC Court and also Summary Civil Suit of Recovery, however the strong base of the case can only be casted in the very beginning as initially you are required to file police complaint and issue legal notice/s to the accused and your original story of claiming amounts being complicated has to be newly formed only based upon the remaining 2 blank cheques' you possess, as even bringing small changes to your complaint idea / story in later stages of any suit may result in shattering of your legal right of recovery. some crucial points are to be mentioned by you such as: 1. if signing of any agreement took place either on letter-head or stamp-paper between both parties ? 2. What is the mode of transfer of given loan amount? 3. When were the cheques issued in your favor? 4. Till now, what is mode of payment of interests you have received from borrower? Legal notice and police complaint here are going to form very basis dealing with crucial future trajectory of your cases so future amendments leading to loosening of case can be avoided, I am a High-court level Law-Practitioner based in Maharashtra, India, Specialized in Negotiable Instruments cases, I try to empower people by helping them know about their legal rights as much as much as for free-under my capacity, if you do happen to like my answer you may procced to get the the Strong Legal Notice served on accused at a highly economic fee possible, feel free to reach me out for further advise vide finding me on google, or by contacting the Vidhikarya for my details. Have a lovely day. __Adv. Yogesh Tahiliani (ADVOCATE, BOMBAY HIGH COURT, NAGPUR BENCH)