Returned ecs
Querist :
Anonymous
(Querist) 30 December 2011
This query is : Resolved
In case of the dishonored Electronic Tranfer Advise (ECS) Does the section 25 has the same implications as in section 138 which is for the dishonored Cheques.
Deepak Nair
(Expert) 30 December 2011
No. Section 138 of Negotiable instrument Act does not apply to ECS.
ECS does not fall under the definition of Negotiable Instrument. A negotiable instrument is an instrument in writing duly signed by the maker, containing an undertaking/ order to pay certain amount to a person on presentatin of the same.
Querist :
Anonymous
(Querist) 30 December 2011
Thanks for your reply. Is there any other similar section for ECS in the ACT.
V R SHROFF
(Expert) 30 December 2011
138 N.I.ACT Only proceed against the drawer of Cheque.
ECS, u do not issue cheque, it is not Instrument.
So it does not attract n i act 138
DEFENSE ADVOCATE.-firmaction@g
(Expert) 30 December 2011
Yes the ECS mandate bounce is is punishable under NI act.
(5) The provisions of Chapter XVII of the Negotiable Instruments Act, 1881 (26 of 1881) shall apply
to the dishonour of electronic funds transfer to the extent the circumstances admit.
DEFENSE ADVOCATE.-firmaction@g
(Expert) 30 December 2011
complete provision of ECS mandate bounce are as under=
Dishonour of electronic funds transfer for insufficiency, etc., of funds in the account : (1)
Where an electronic funds transfer initiated by a person from an account maintained by him cannot be
executed on the ground that the amount of money standing to the credit of that account is insufficient to
honour the transfer instruction or that it exceeds the amount arranged to be paid from that account by an
agreement made with a bank, such person shall be deemed to have committed an offence and shall,
without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may
extend to two years, or with fine which may extend to twice the amount of the electronic funds transfer, or
with both:
Provided that nothing contained in this section shall apply unless—
(a) the electronic funds transfer was initiated for payment of any amount of money to another
person for the discharge, in whole or in part, of any debt or other liability;
(b) the electronic funds transfer was initiated in accordance with the relevant procedural
guidelines issued by the system provider;
(c) the beneficiary makes a demand for the payment of the said amount of money by giving a
notice in writing to the person initiating the electronic funds transfer within thirty days of the receipt of
information by him from the bank concerned regarding the dishonour of the electronic funds transfer; and
(d) the person initiating the electronic funds transfer fails to make the payment of the said money to
the beneficiary within fifteen days of the receipt of the said notice.
(2) It shall be presumed, unless the contrary is proved, that the electronic funds transfer was
initiated for the discharge, in whole or in part, of any debt or other liability.
(3) It shall not be a defence in a prosecution for an offence under sub-section (1) that the person,
who initiated the electronic funds transfer through an instruction, authorisation, order or agreement, did
not have reason to believe at the time of such instruction, authorisation, order or agreement that the credit
of his account is insufficient to effect the electronic funds transfer.
(4) The Court shall, in respect of every proceeding under this section, on production of a
communication from the bank denoting the dishonour of electronic funds transfer, presume the fact of
dishonour of such electronic funds transfer, unless and until such fact is disproved.
(5) The provisions of Chapter XVII of the Negotiable Instruments Act, 1881 (26 of 1881) shall apply
to the dishonour of electronic funds transfer to the extent the circumstances admit.
Explanation.— For the purposes of this section, “debt or other liability” means a legally enforceable
debt or other liability, as the case may be.
Shonee Kapoor
(Expert) 30 December 2011
I also agree with JSDN,
ECS is also an instrument and comes in the ambit of 138.
Regards,
Shonee Kapoor
harassed.by.498a@gmail.com
