Complete Cheque Bounce Guide in Kolkata 2026

Understanding Cheque Bounce Under Section 138 NI Act

Cheque bounce (dishonour of cheque) is a criminal offence under Section 138 of the Negotiable Instruments Act, 1881. It occurs when a cheque drawn by a person on an account maintained with a bank is returned unpaid due to insufficient funds or exceeding the arrangement. The Section was introduced to enhance the credibility of cheques and ensure that cheque transactions are honored. The offence is punishable with imprisonment up to 2 years and a fine up to twice the cheque amount. In Kolkata, cheque bounce cases are filed before the Metropolitan Magistrate Courts at Bankshall, Sealdah, or Alipore depending on jurisdiction.

Legal Requirements for Cheque Bounce Case

For an offence under Section 138 to be made out, the following conditions must be satisfied: The cheque must have been issued for discharge of a legally enforceable debt or liability. The cheque must have been presented within 3 months (or validity period) of its date. The cheque must have been returned unpaid by the bank. The payee must send a legal demand notice within 30 days of receiving the bank's return memo. The drawer must fail to make payment within 15 days of receiving the notice. If any of these conditions is not met, the case may be dismissed.

Step-by-Step Process for Cheque Bounce Case

Step 1: Visit the bank and obtain the cheque return memo with the reason for dishonour. Step 2: Send a legal demand notice to the drawer within 30 days of the return memo. Step 3: Wait for 15 days for the drawer to make payment. Step 4: If payment is not made, file a complaint under Section 138 NI Act before the Magistrate Court within 30 days of notice expiry. Step 5: The court examines the complainant and issues summons to the accused. Step 6: Evidence is presented through affidavit and documents. Step 7: Cross-examination of the complainant and witnesses. Step 8: Statement of the accused and defense evidence. Step 9: Final arguments and judgment.

Legal Notice Format and Requirements

The legal notice is a crucial document in a cheque bounce case. It must contain: Complete details of the cheque (date, number, amount, bank), reason for dishonour as per the return memo, a clear demand for payment of the cheque amount within 15 days, a warning of criminal prosecution if payment is not made, and the signature of the payee or their advocate. The notice must be sent by registered post with acknowledgment due, and also by speed post or courier for additional proof of service. The notice period of 15 days is mandatory and cannot be reduced.

Defenses in Cheque Bounce Cases

Common defenses include: The cheque was not issued for a legally enforceable debt (gift, loan to friend without proof, time-barred debt), the cheque was given as security (not for payment), the cheque was lost or stolen, the signature on the cheque is forged, the account was closed before the cheque was presented, there was no proper service of legal notice, the complaint was filed beyond the limitation period, the debt was discharged before the cheque was presented, or the cheque was post-dated and presented before its date.

Settlement and Compoundability of Cheque Bounce Cases

Cheque bounce cases are compoundable, meaning the parties can settle the matter amicably. The Calcutta High Court has encouraged settlements in cheque bounce cases. The typical settlement involves payment of the cheque amount along with some additional costs. Once the accused pays the cheque amount (with or without additional compensation), the complainant can withdraw the complaint. The court records the settlement and acquits the accused. Settlement can be reached at any stage of the proceedings — before trial, during trial, or even after conviction.