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Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     03 October 2015

Demand notice under section 138 of ni act

A cheque bounced as the drawer of the cheque had given ‘stop cheque instructions’ to his bank. The payee of the cheque failed to send demand notice within the 30 days limit imposed by sub-clause (b) of Section 138 of the Negotiable Instruments Act.  Can the payee against present the cheque in his bank get it bounced and claim a fresh 30 day notice period under clause (b).  As the cheque bounced originally due to ‘stop cheque instructions’ and not due to inadequacy of funds in the account, there is no other reason other than to beat the 30 day limit,  for the payee to make a second try.


 19 Replies

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     03 October 2015

There is one correction. Please read 'again' and not 'against' in above query

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     03 October 2015

There is one correction. Please read 'again' and not 'against' in above query

Prasun Chandra Das (Banker)     03 October 2015

Q) Can the payee against present the cheque in his bank get it bounced and claim a fresh 30 day notice period? A) Yes, absolutely.See Msr Leathers vs S. Palaniappan And Anr. September, CRIMINAL APPEAL NOS.261-264 OF 2002- By Supreme Court of India – Date of Judgment 26.09.2012. As to the reason of chq bounce, though Sec 138 mentions insufficiency of funds as reason for chq bounce, successive court judgements have also applied sec 138 to be valid for ANY reason for chq bounce. So don't worry on that.


Please note it all depends on why stop payment was done?  If I have not bought any product or service and have taken delivery or consumed it and cheque was paid as advance payment. I can always stop payment on not needing service or having some doubt about supplier or quality.

Only when cheque is issued for a supply of good or services already purchased then the bouncing of cheque on insufficient funds attrccts the 138 provisions. Stop payment  in general is not crime.


In case of bouncing of cheque two offesnes can be made out- either 138 NI or IPC420

niranjan (civil practice)     03 October 2015

You can also file summary suit as well.

DAULAT DILBAUG (Problems related to money marriage     04 October 2015

The main question is wheter the cheque can be presented again.


The MSR lether case will no tbe applicable since first bounce is due to stop payment.




Stop payment is not bouncing of cheque.Please note. A drawer has all the rights to stop payment if he has valid and legal reasons to do so,For example I isue cheque to a broa dband servcie company to purchase a connection but change mind.I can always stop payment cheque.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     04 October 2015

@ Prasun Chandra Das: In the MSR Leather vs. S. Palaniappan case the cheque was returned for insufficiency of funds. Drawer asked the payee to present the cheque again implying sufficient funds would be made available. Hence a second presentation was justified. In this case it was a categorical stop payment and hence no reason for another attempt. @ DR. Rajendra Gupta: The question why the cheque was issued will come only after the case is admitted, not if it was stopped for non-compliance of notice under clause(b) There is Supreme Court judgment that 'Stop cheque' instruction will also attract NI-138 @niranjan- who can file summary suit the payee or the drawer? I request all the experts to clarify.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     04 October 2015

@ Prasun Chandra Das: 1. Repeated presentation of the cheque is allowed. 2. Stop cheque instructions will also attract NI:138. But have both the two together occured in any case? If so what was the judgment?


Many people specially lawyers have tendency to intimidate clients and litgnats and even courts with surpeme court case laws. Let me clear nothing is bigger authority than logic and truth. Honourable supreme court only interpretes transaction with point of view of constitutional validuty and logic.So litgants should go by logic. If you have done nothing wrong just dont give  adamn to what any high court or supreme court has said in some case. Just stand by your triuth and logic.

Let me tell an exmaple: I wona money decree in Chandigarh, I had by thattime left chandigarh.Obviously judgment debtor went for appeal with sessions. I was not evne served notice. But after 2 yearsession judge simply dismissed appeal. The lawyer of party had submitted more than 7 authorities form high court and supreme court. The case was processed ex=parte. So have faith in justic esystem. Even if you dont attend court but you areon pathg of turth and logic and have solid documentary support no one can defat you in courts .

Sudhir Kumar, Advocate (Advocate)     04 October 2015

for which liability the cheque was issued.

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     05 October 2015

There is dispute regarding what for the cheque was issued. Drawer says it was advancing of a loan. The payee makes a vague claim of goods sold without any voucher or invoice and 'compensation' for selling a property. He had nothing to do with the transaction. He is a shop-keeper. Anyway the question what for the cheque was issued will come only crossing the hurdle after crossing the hurdle of validity of notice. I think the accused need to answer the question why the cheque was issued only after the first hurdle was crossed. Am I right?

I cannot agree more with Dr. Rajendrs Gupta. Please visit my profile. Most lawyers read only the last sentence of a High Court or Supreme Court judgment and use it to advance their case.

I am still waiting for advice from Mr. Prasun Chandra Das with regard to my further query.

Vaibhav Dixit (IIT Guwahati (B.Tech.))     28 October 2015


If the 30 day period after the return of cheque has passed and the demand notice still has not been delivered (due to post office delays). What can be done?


Can the cheques be presented again (and thus get them bounced) to buy some more time?


HOW DO YOU KNOW NOTICE HAS NOT BEEN DELIVERED? You are making query here as drawee or drawer? Theresn somehting hanky panky in entire episode going on. Once notice has bene sent by post and has not been returned in 30 days time it is proof ofdelivery.You must have receipt of regd ad or speedpost.

If it has ben retunred what areremarks of the postman?

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