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Dishonour of cheque popularly known as “Cheque Bounce” is not only a civil wrong but also a criminal offence under section 138 of Negotiable Instrument Act (N.I. Act).
Once Cheque is given by the Drawer to Drawee/Payee then there is presumption of honouring the cheque amount. Hence, when there is a cheque dishonoured by the Drawer then the Drawee can call upon the Drawer legally to pay the cheque amount by way of Statutory Notice.
The Drawer has to pay the cheque amount upon receipt of the said Notice within 15 days and failing which the Drawee/Complainant can file a Complaint against the Drawer/Accused under section 138 of N.I. Act (the Cheque Bounce Case).
Punishment in 138 NI Act : the imprisonment that may be imposed may extend to two years, while fine may extend to twice the amount of cheque.