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About Advocate Siddharth Gulatee
Expertise
Can Answer : Questions relating to civil and constitutional law in India, including property, contractual, and personal law disputes. Specific queries on litigation in civil court, High Court and the Supreme Court of India. All questions pertaining to miscellaneous administrative matters like registration and recording rights and documents etc, conveyancing. Cannot Answer : Questions pertaining to tax and criminal matters.

Experience
4 years

Organizations
Legal Solutions Advocates & Consultants www.legalsolutions-jbp.webs.com

Education/Credentials
B.A. LL.B.(Hons)

Past/Present Clients
Private clients and companies including public sector enterprises

You are here: Experts > Business > International Law > Indian Law > Dishonour of cheque

Indian Law - Dishonour of cheque

Expert: Advocate Siddharth Gulatee - 11/5/2009

Question
Hi,
My House owner paid the advance amount to me as cheque which bounced due to insufficient funds(twice i deposited).
Second bounce date was 31/10/2009. Mean while i have asked the house owner, but he is buying time and trying not to settle the amount. I have asked him several times. Also for future use,I have recorded the conversations we had on phone.
Even today i spoke with him, he said next week he would pay. Actually he owns a small constructions company and is well-off.But he is not willing to settle the amount.

I have follwing questions,

1.Whether i will get back my amount in 15 days if i sent him a legal notice about the cheque bounce.If he is not paying with in the 15 days period, as per NI 138 act, if i file a case will i get the amount back.
2. In the event of filing case, he may have political power and have influence in the local police station.I am a bachelor with no background.
So will i get a solution if i go legally, or i should negotiate with him or if he denies then should i forget my money.
Please suggest me how i can go ahead.what is the practical solution for me.

Please advise me.
Thanks in Advance.
Regards,
Sivaraj C

Answer
Hi Sivaraj,

Being without a background is not a curse or a handicap. It's always an advantage because you are not tied down to old traditions and can always venture into the adventurous. Anyways, now to your problem.

Whenever, a person issues a cheque and it bounces, the payee or holder has three remedies :

1st : The holder or the payee can file a police complaint against the drawer (the one who issues the cheque) for offence of cheating and fraud .

2nd : The holder/payee can also file a civil suit for recovery of the amount of the cheque

3rd : This is the most popular mode. A complaint can be filed before a Magistrate for the offence under Section 138 of the NI Act. Before filing of the complaint you are required to issue a notice for demand within 30 days of the intimation from the Bank that the cheque has bounced. After receipt of the notice the drawer has 15 days to clear the payment. In case he does not do so, you have further 30 days time to file the complaint in the court. Remember, you get only one opportunity to issue the notice. So before issuing the notice carefully contemplate the situtation and try to negotiate with him if he is ready to pay. Also remember, that the cheque has a validity period of only 6 months after that it is not covered under the NI Act. However, during the six months period the cheque can be represented any number of times. However, as stated above, you get only one chance to issue the demand notice. Ordinarily this remedy under the NI Act is good enough and after you win the case you would get the amount of the cheque in the form of fine which the court would direct him to pay.

So, consult a good lawyer and move ahead.

For any further clarifications feel free to follow up

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