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Cheque Bounce — Section 138

If a cheque bounces for insufficient funds, Section 138 NI Act gives the payee a strict, time-bound remedy.

The 30-15-30 timeline

  • Present the cheque within 3 months of the date it bears.
  • Send a legal notice within 30 days of the bank return memo.
  • Drawer gets 15 days to pay; if they do, no case can be filed.
  • File complaint before the Magistrate within 30 days of the 15-day period expiring.

What you can recover

  • Fine up to twice the cheque amount + interest; imprisonment up to 2 years.
  • Interim compensation up to 20% of cheque amount under Sec. 143A.
  • Case is compoundable — most cases settle through mediation.

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This is general legal information, not legal advice. Please consult a qualified advocate for your specific situation.