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Cheque Bounce Notice Format

Cheque Bounce Notice Format

A Cheque Bounce, formally termed a Cheque Non-Payment, is a severe offense in India. The offense is punishable under the Negotiable Instruments Act with defaulter’s imprisonment, fine, or both.

If a cheque bounces, then the beneficiary from the cheque must present the cheque issuer with a cheque bounce notice within 30 days of its return. The check bounce notice is issued to protect the beneficiary’s rights under Section 138 of the NI Act.

A cheque bounce notice is a serious intimation to the cheque issuer by the cheque beneficiary. The beneficiary will take legal action against the issuer if the cheque payment is not transacted immediately. Every check beneficiary must validate its cheque bounce notice by containing references from Section 138, Negotiable Instruments Act.

These references include information about the cheque presentation time, reasons for non-realization of payment, and a request to the cheque issuer to arrange payment immediately through alternate means. A Beneficiary must issue the notice within 30 days of its return. You can download the legal notice sample format for Cheque Bounce in Word from our website. It is also attached to this web page.

Issuing a Cheque Bounce Notice

Drafting the Check Bounce Notice

You can connect with the Registrationwala to draft your cheque bounce notice. If you have drafted the cheque bounce notice, then you can print it on white paper or a company’s letterhead. Finally, you can deliver it to the bounced cheque issuer.

Cheque Bounce Notice content

The cheque bounce notice must contain the following:

Name of the Cheque Beneficiary
Check issuer’s Name and Address
Date of Bounced Cheque return
Reason for the cheque’s return
Request for alternate payment arrangements

Sending the Check Notice

The beneficiary must send the notice through a registered post so as to record the date of issuing the notice formally. The cheque beneficiary must retain one copy of the notice and send the other to the cheque issuer.

You can download the legal notice sample format for Cheque Bounce in Word from our website. It is also attached to this web page. You can also download the legal notice format for cheque dishonor English in pdf.

When to issue a Cheque Bounce Notice?

The Cheque beneficiary must satisfy the following eligibilities before issuing a cheque bounce letter and initiating a legal recourse:

Cheque’s Liability: The beneficiary must provide the cheque towards a liability.

Cheque Validity: The beneficiary must present the cheque with a validity period of 6 months.

Cheque Refusal: The Bank must have refused the issued cheque to enchase due to insufficient funds or incorrect information.

Issuing Notice: The payee must make a demand for the payment by giving a cheque bounce letter. The beneficiary must issue the notice in writing within one month of receiving intimation from the Bank that funds are insufficient.

Payment Failure: The drawer fails to pay the amount within 15 days of receiving the notice.

Legal Action: The beneficiary can initiate a legal action within one month from the arousal of the cause-of-action.

Legal Action in case of a Cheque Bounce

The steps for the legal course are as follows:

Issuing Cheque Bounce Notice

Check Return Notice Format: The payee must issue the notice to the defaulter within 30 days of the cheque’s dishonor by post, registered or speed, acknowledgement due. The payee must ensure that the notice is in a proper format, with the following information:

Nature of Transaction
Amount
Cheque Deposit date
Cheque Bounce date
Cheque Bounce reason
Payment request within 15 days

Filing Criminal Case

If the defaulter fails to pay the amount within 15 days of notice, then the payee will file a criminal case within one month from the notice’s expiry in court. The payee can file the cheque bounce complaints in a court of a city where the cheque was presented.

Court Hearing