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wishal (sr)     06 April 2015

Cheque given by fraud person which account closed

Hello frds.

I am running my business and i requred staff. So one person came to me and told me that we are running NGO and we will provide you staff. I need to register it . They taken 50k from me as a cheque. 

Now after multiple phone calls they didnt send any staff and told me tht colect payment from his office. I went there it was just a small chamber

Gave me cheque of 50k 7 days late. It was of some co-op. Society. 

Today i got a call tht dont deposit cheque we have closed tht accont. He will sms me nt to deposit. He is fraud wht should i do? If he has closed account and i drop cheque then is it my crime??? Or i should deposit cheque???



Learning

 3 Replies

saravanan s (legal advisor)     06 April 2015

if the cheque is not time barred just deposit the cheque.

Devaraj Krishna (Legal Practitioner)     06 April 2015

Cheque bounce cases - what to do, when and how

You would think it should be easy to get someone to pay up whose cheque has bounced... It's not rocket science, but timing and procedure are very important. Find out about the steps involved...

Do you need to recover an amount due on a cheque that bounced? Criminal prosecution (rather than filing a civil suit) is your first best friend.

Criminal cheque bounce case

Send a letter (a demand notice) to the party who wrote the cheque (the drawer), threatening to initiate proceedings under the Negotiable Instruments Act (NI Act) if the amount due is not paid. The threat of prosecution can often work its magic and result in prompt settlement. (If the drawer is an individual, the proceedings would happen under Section 138 of the NI Act. If the drawer is a company, its managing director can be personally prosecuted under Section 141.)

30 day time limit to send demand notice

The demand notice must be sent within 15 days from the date of return bank endorsement stating the reason for the cheque issued to you has bounced. There is no prescribed format for this notice. Its purpose is to demand payment and inform the issuer that he or she will be prosecuted if payment is not made within 15 days. So it should contain the following information:

  1. Statement that you presented the cheque within its period of validity;
  2. Statement of debt or legally enforceable liability;
  3. Information about the reason of dishonour of cheque (Check the memo of the bank returning the cheque for these);
  4. Calling upon the drawer to pay the amount due; and
  5. Statement that you are giving the drawer 15 days to pay up or you will initiate legal action.

A lawyer is  required to send this notice, because the notice often becomes the point of fierce battle when a dispute does reach trial.

Proof of service of the notice is very important – you can send it via courier if pressed for time but do also send a copy through registered post or speed post. If not pressed for time, just the speed post by itself is a perfectly viable option.

If you have the verified email ID of the drawer you can send the notice via email too, the Bombay high court has observed. However we wouldn’t trust this unconventional method, especially since other high courts can overlook the ruling of a given high court.

It is the 15th day and no payment has still been received? You now have no more than 30 days within which to file a complaint before a magistrate.

Which area’s magistrate can you file a complaint with? A magistrate in any of the places out of the following: Where the cheque was drawn; where the cheque was presented; Where the cheque was returned by the bank; where the demand notice was served by you

Note 1: A delay (taking longer than the 30-day time limit) in filing a complaint before a magistrate may be excused by them in exceptional circumstances, a delay in sending the demand notice will always prevent you starting any future criminal prosecution.

Note 2: If during the validity of the cheque, after the demand notice has been sent by the payee, the drawer asks the payee to present the cheque again and it is yet again dishonoured, that doesn’t mean that the drawer’s time-limit under the demand notice has increased. The payee has to stick to the original timelines.

Note 3: Dishonour of a cheque due to stopped payment is also covered under Section 138 of the NI Act.

Note 4: If the cheque was issued as a gift, donation, or any other obligation which is not legally enforceable, the Negotiable Instruments Act will be of no use to you. If the cheque was issued more than six months ago, it has already expired.

Sudhir Kumar, Advocate (Advocate)     07 April 2015

irrespective of S/138 this appears to be case of cheating.


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