how put case for cheque bounce

suresh (Querist) 30 May 2009 This query is : Resolved
Hi.. Dear Experts Please give me guidlines for the problem stated.. The story is... me and my friend are buissnes partners we both running a bussisnes one fine day my partner to qiut the buissness ok then i told shre the porfit and loss and calaculate and gave cheque to me i dropped in to my account its bounce what shall i do Please suggest me...how to proceed further.

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A V Vishal (Expert) 30 May 2009
On the dishonour of a cheque, one can file a suit for recovery of the cheque amount along with the cost & interest under order XXXVII of Code of Civil Procedure 1908 ( which is a summary procedure and) can also file a Criminal Complaint u/s 138 of Negotiable Instrument Act for punishment to the signatory of the cheque for having committed an offence. However, before filing the said complaint a statutory notice is liable to be given to the other party.

You should file the cheques and present for encashment. The Partnership Firm as well as partners are personally liable and even after dissolution also the firm and partners are liable. Once the cheques are dishonoured you have to file a suit for recovery of the said amount under the summary procedure provided in Order 37 of Code of Civil Procedure, 1908. You should also file a complaint under Section 138 of the Negotiable Instruments Act. For this you will have to first give a notice, within 30 days of the dishonouring of the cheques. Then if payment is not made within 30 days of receipt of notice a complaint has to be filed within 30 days thereafter.

adv. rajeev ( rajoo ) (Expert) 30 May 2009
One correction is vishal's answer. time to make the payment is 15 days not 30 days from the date of receipt of the notice.

sanjeev murthy desai (Expert) 30 May 2009
yes rightly viewd by Mr. Rajeev,

Khaleel Ahmed (Expert) 30 May 2009
Dear Suresh,

issue legal notice of 15 days to the person who has issued the cheque, on defaul file a criminal complaint U/S138 NI act read with 420 of IPC.

A V Vishal (Expert) 30 May 2009
Dear Members,

I differ with Mr Vadrali & Desai, Kindly refer the amendments made in The N I Act in 2002.

Changes made by Amendment Act, 2002 - (a) Definition of ‘cheque’ and related provisions in respect of cheque amended to facilitate electronic submission and/or electronic clearance of cheque. Corresponding changes were also made in Information Technology Act. (b) Bouncing of cheque - Provisions amended * Provision for imprisonment upto 2 years against present one year * Period for issuing notice to drawer increased from 15 days to 30 days * Government Nominee Directors excluded from liability * Court empowered to take cognizance of offence even if complaint filed beyond one month * Summary trial procedure permitted for imposing punishment upto one year and fine even exceeding Rs 5,000 * Summons can be issued by speed post or courier service * Summons refused will be deemed to have been served * Evidence of complainant through affidavit permitted * Bank’s slip or memo indicating dishonour of cheque will be prima facie evidence unless contrary proved * Offence can be compounded. - - The amendments have been made effective from 6-2-2003.