Cheque Bounce Notice (Section 138)

When a Section 138 notice can be sent

• The cheque must have been given to pay a legally enforceable debt or liability, such as a loan, unpaid invoice, rent or a settlement amount. A cheque given purely as a gift or donation does not fall under Section 138.
• The cheque must have been presented to the bank within its validity period, which is three months from the date written on it. A cheque presented after that is stale and the bank will not honour it.
• The bank must have returned it unpaid for a reason covered by the law, such as insufficient funds, amount exceeding arrangement, account closed or payment stopped by the drawer. A return for a technical reason like a signature mismatch still needs to be looked at case by case.
• The written demand notice must reach the drawer within 30 days from the day you receive the return memo from your bank. This period cannot be extended later.
• The notice must clearly demand payment of the cheque amount. If the drawer does not pay within 15 days of receiving it, the complaint must be filed in court within one month after those 15 days end.
• The complaint is filed by the payee or holder in due course. If the payee is a company or firm, an authorised person files it on the basis of a board resolution or authority letter.

What affects the total cost

• Postage: the notice is usually sent by registered post or speed post with acknowledgement due, and often also by email or WhatsApp to the drawer, so that delivery can be proved later.
• Number of drawers and addresses: if the cheque is from a firm or company, notices may need to go to the firm and to each partner or director responsible, which increases copies and postage.
• Number of cheques: several bounced cheques from the same person can usually be covered in one notice, but each must be within its own 30 day window.
• Court fee on the complaint, if the matter goes to court: this depends on the court and, in some places, on the cheque amount. The team explains the applicable fee on the call before any filing.
• Further stages: replying to the drawer's response, filing the complaint, and appearing at hearings are separate pieces of work from sending the notice.

How long it takes

Drafting and dispatch of the notice normally takes one or two working days once you share the cheque, return memo and proof of debt. Postal delivery inside Delhi NCR usually takes a few days; for other cities it may take a week. The 15 day payment period starts from the date the drawer actually receives the notice, or from the date it is refused or returned as unclaimed. Delays usually happen when the return memo is already close to its 30 day limit, when the drawer's current address is not known, or when the cheque was issued by a company and the responsible directors have to be identified.

Common mistakes to avoid

• Waiting too long after the return memo and sending the notice after 30 days, which makes a Section 138 complaint impossible on that dishonour.
• Demanding a different or larger amount than the cheque in the notice, such as adding interest or other dues without clearly separating them. An unclear demand can be challenged.
• Sending the notice to an old or incomplete address and keeping no tracking report or acknowledgement card to prove delivery.
• Losing the original cheque or the original return memo. Both are needed as evidence in court.
• Filing the complaint before the 15 day payment period has ended, or missing the one month deadline after it.

What you get at the end

You receive a copy of the signed notice, the postal receipts and, later, the tracking report or acknowledgement card. Keep these together with the original cheque and return memo in a safe file. If the drawer pays within 15 days, take the payment in a traceable way and give a written receipt. If they do not pay, these papers form the base of the criminal complaint, and the complaint must be filed within the next one month.

In Delhi NCR

• Under Section 142 of the Act, the complaint is generally filed in the court that covers the area of the bank branch where the payee presented the cheque for collection. So if your account is in a Delhi branch, a Delhi court usually has jurisdiction even if the drawer lives elsewhere.
• Delhi district courts have dedicated courts that hear Negotiable Instruments Act cases. The right district court depends on which police station area your bank branch falls in.
• If your bank branch is in Gurugram or Faridabad, the case goes to courts in Haryana; if it is in Noida or Ghaziabad, it goes to courts in Uttar Pradesh. The notice itself can be sent from anywhere.
• Delhi courts commonly accept proof of notice sent by email or WhatsApp along with postal proof, so sharing the drawer's email and mobile number helps.
• If you are outside NCR, the team can guide you online, and the notice can be drafted and posted on the basis of scanned documents, with the originals kept safely by you for court.