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Pavan   22 November 2021

Check bounce case

One of director of company issued cheque and got bounced and this real estate company have 4 directors

 

can I file check bounce on all 4 directors or only one who issued the cheque

 



 15 Replies

Anaita Vas   22 November 2021

A cheque bounce may happen due to the reasons mentioned below:

1.Presenting of cheque to the Bank after 3 months

2. Insufficient funds

3. Alterations or overwriting in cheque

3. Stopping of payment by account holder

4. Non-matching of signature

However, it becomes an offence under the Negotiable Instruments Act, 1881 if the unpaid cheque is returned by the bank because of:

1. Lack of sufficient funds in the bank account, or

2. The amount on cheque exceeding the amount to be paid in agreement with the Bank

Cheque Bouncing is a criminal offence under Section 138 of the Negotiable Instruments Act, 1881, and may attract the following punishments:

1. Imprisonment extending up to two years, or

2. Monetary fine which may extend to double the amount on the cheque, or

3. Both of the above

The Directors may be held liable for the Company in cheque bouncing matters under Section 141 of the Negotiable Instruments Act, 1881. According to this Section, each person who was in charge of the Company and responsible for its business, at the time the offense was committed will be liable, along with the Company.

Not only the Director, even a manager, secretary, or officer of the Company may be accountable in cases where the offence of cheque bouncing was committed due to the neglect or consent of such persons.

However, the Director of a Company would not have to face punishment if he is able to prove the following:

1. That the offense was committed without his knowledge

2. That he applied due diligence

3. That there is proof beyond doubt, that the accused director was not involved in the proceedings due to his prolonged illness

4.That the complaint has not been made in accordance with Section 138 or 141 of the Act

5. That he resigned from his post before the cheque got dishonored

Therefore, the reason to hold a person accountable of a cheque bouncing case, cannot be only based on the fact that he/she is the Director of a Company. Only when such person is responsible for the Company and was in charge of the conduct of its business, he/she may be held liable.

 

Regards,

Anaita Vas

Kishor Mehta (CEO)     22 November 2021

File a bounce cheque cae on the company and make the directors the party.

Pavan   22 November 2021

Bhrigu Infra private limitied have 4 directors at time of issue of cheque.

Query:   If in Section 200 CR.P.C,offence U/s 138 of NI Act complaint , If below is mentioned as accused name , then the complaint will be registeed in name of Shabana Shaik or on all the directors

 

Name & address of Accused in complaint  mentioned as M/s.Bhrigu Infra private limitied rep.by its Executive director Mrs.Shabana Shaik,W/o Rakesh Age:46 years,Occ:Business,O/o Hanamkonda

Kishor Mehta (CEO)     22 November 2021

Since only one director is specified by name, complaints against other directors will not be maintained. However the company is responsible. 

Jagadish A   22 November 2021

you can file case against one director who is actively particiapting in day to day affairs of the company

 

Jagdish

Pavan   22 November 2021

watchman's wife is made on of direcotor of private limited company

Yes Sir but director who signed cheque is watchman's wife and when I asked my layer to include all directors name, he rejected to include the same and filed complaint  aainst signed women director

Query 1 :My advocate said if we include other directors then case will dismissed.Is it true?

Query 2: if she cant pay and willing go to Jail then in this case can other directors can be dragged to this cheque bounce case

Kishor Mehta (CEO)     22 November 2021

" Name & address of Accused in complaint  mentioned as M/s.Bhrigu Infra private limitied rep.by its Executive director Mrs.Shabana Shaik,W/o Rakesh Age:46 years,Occ:Business,O/o Hanamkonda "

The company is liable alongwith the specified director.

 

Pavan   22 November 2021

THanks for your reply Sir.

THen if jail term is sentenced for 1 year say ,will all director get jail term or only Mrs.Shabana Shaik,W/o Rakesh
 

Kevin Moses Paul   22 November 2021

Only the drawer of the Cheque i.e. Mrs Shabana Shaik in your case, will be awarded punishment and not the other directors.

Pavan   22 November 2021

Query 1 : SO Sir how to make other directors be awarded punishment
 

Quert 2 : But Kishor Mehta Sir said that "The company is liable alongwith the specified director:.In what case company is liable

 
 
 

G.L.N. Prasad (Retired employee.)     22 November 2021

When an individual performs duty in his capacity the company is alone responsible and the signatory represents the company. The facts may bring out several other criminal offenses as there are qualifications for appointment of director and the decision-making process in such suitcase company may also bring several other offenses under Indian Companies Act.  If you have time, you can get all the financial statements submitted to the Registrar of companies to find out further and if the amount involved is substantial you can even move for liquidation of the company.

P. Venu (Advocate)     22 November 2021

Nowadays, in NI 138 cases, only token punishment is imposed. What is your concern - in getting your money back or the incarceration of the accused?

Pavan   22 November 2021

getting your money back

 

Dr J C Vashista (Lawyer)     24 November 2021

The company and the director who has signed can be prosecuted.


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