In the world of transactions, cheques remain a prevalent mode of payment. However, situations arise where a cheque presented for encashment gets dishonored by the bank due to insufficient funds or other reasons. This is commonly referred to as a cheque bounce or dishonored cheque.

To recover the due amount in such scenarios, the payee (the person to whom the cheque is issued) can resort to legal action by issuing a cheque bounce notice (bounced cheque notification, dishonored cheque alert, non-payment notification, etc.). This blog guide will give you all the necessary information regarding cheque bounce notices in India.

What Is A Cheque Bounce Notice?

A cheque bounce notice is a formal written demand sent by the payee to the issuer (drawer) of a bounced cheque. It is the first step towards initiating legal action under Section 138 of the Negotiable Instruments Act (NI Act) to recover the dishonored cheque amount.

This notice acts as a returned cheque warning (unsuccessful cheque notification, failed cheque payment notice) informing the drawer about the cheque dishonor notification (non-cleared cheque notice, payment failure alert) and requesting them to pay within a stipulated timeframe.

Issuance of Cheque Bounce Notice

Issuance of Cheque Bounce Notice

The timely issuance of a Cheque Bounce Notice is crucial for initiating legal proceedings against the drawer. Here’s a breakdown of the process:

1. Time Limit:

The notice must be sent within 30 days of receiving information from the bank about the cheque bounce.   

2. Mode of Communication:

The notice should be sent in writing through registered post (acknowledgment due). This ensures a record of delivery and serves as proof in court. While email or WhatsApp communication might be explored in the future (as discussed later), registered post remains the most reliable method.

3. Content of the Notice: The notice should mention the following details:

    • Payee’s name and address
    • Drawer’s name and address
    • Cheque details (cheque number, date, and amount)
    • The date on which the cheque was deposited and the date it bounced
    • Reason for the cheque bounce (as informed by the bank)
    • A clear demand for payment of the cheque amount within a stipulated timeframe (usually 15 days)
    • Reference to Section 138 of the Negotiable Instruments Act (NI Act) – the legal provision dealing with cheque bounce.

Jurisdiction of a Cheque Bounce Notice in India

The legal framework governing cheque bounce notices in India is established by the Negotiable Instruments Act (NI Act), 1881. Specifically, Section 138 of the NI Act deals with the issuance of a cheque bounce notice and the consequences of cheque dishonor. The conditions under which a cheque can be considered dishonored, the process for filing a complaint, and the penalties for cheque bounce are outlined in this Act.

Importance Of Cheque Bounce Notice

Importance of Cheque Bounce Notice
A Cheque Bounce Notice Holds Significant Importance For The Payee in a Dishonored Cheque Scenario. Here's why:

  • Initiates Legal Action: The notice is a formal precursor to filing a legal complaint under Section 138 of the NI Act. It demonstrates a genuine attempt to recover the dues willingly before resorting to court proceedings.

  • Strengthens Case: A properly drafted and delivered cheque bounce notice strengthens the payee’s case in court. It establishes clear communication and a demand for payment within a reasonable timeframe.

  • Deters Future Instances: Issuing a cheque bounce notice can deter the drawer from bouncing cheques in the future. The potential legal consequences serve as a reminder to maintain sufficient funds or issue cheques responsibly.

Procedures For Cheque Bounce Notice In India

The procedure for issuing a cheque bounce notice in India is relatively simple. Here’s a summarized flow:

  • Upon receiving intimation of the cheque bounce from the bank, the payee drafts a cheque bounce notice within 30 days.

  • The notice includes all the necessary details and a demand for payment within 15 days.

  • The notice is sent to the drawer via registered post with acknowledgment due.

  • If payment is not received within 15 days of receiving the notice, the payee can file a legal complaint under Section 138 of the NI Act in the appropriate magistrate’s court.

Documents Required For A Cheque Bounce Notice In India

While a formal format isn’t mandated, a cheque bounce notice should ideally contain the following information:

  • Payee’s Name and Address
  • Drawer’s Name and Address
  • Cheque Details (Cheque number, date, and amount)
  • Reason for Dishonor (as mentioned in the bank statement)
  • Demand for Payment within 15 days
  • Reference to Section 138 of the NI Act (optional).

How To Draft A Cheque Bounce Notice In India

There’s no specific format mandated by law for a cheque bounce notice (also known as an unsuccessful payment notification, payment reversal notice, etc.) in India. However, it’s recommended to include the following details for clarity and legal validity:

8 Steps To Draft a Cheque Bounce Notice :
  1. Your Name and Address (Payee): Identify yourself as the payee of the dishonored cheque.
  2. Drawer Name and Address: Include the complete name and address of the person who issued the cheque.
  3. Cheque Details: Mention the cheque number, date, and amount.
  4. Date of Dishonor: Specify the date on which the bank returned the cheque due to insufficient funds or other reasons ( cheque dishonor advice, payment rejection notice, etc.).
  5. Reason for Dishonor (if available): If the bank has provided a reason for the dishonor (insufficient balance warning, cheque dishonor notification ), include it in the notice.
  6. Demand for Payment: Clearly state a demand for payment of the cheque amount within a specific timeframe (usually 15 days).
  7. Reference to Section 138: Mention that the notice is served under Section 138 of the Negotiable Instruments Act.
  8. Signature and Date: Include your signature and the date on which the notice is sent.

What Are The Consequences Of A Cheque Bounce Notice In India?

A cheque bounce notice in India, while a formal communication, serves as a warning to the drawer. Ignoring a cheque bounce notice (unsuccessful payment alert, payment reversal notification, Insufficient funds alert ) can lead to legal action against the drawer under Section 138 of the NI Act. This can result in:

  • Imprisonment for a term of up to two years
  • Fine
  • Both imprisonment and fine

The severity of the punishment depends on the specific circumstances of the case.

Cheque Bounce Notice

Cheque Bounce Notice Online

Traditionally, cheque bounce notices were delivered physically. However, a recent landmark judgment by the Allahabad High Court has paved the way for a more modern approach. The court ruled that a demand notice sent electronically through email or WhatsApp can be considered valid in cheque dishonor cases. This ruling ( cheque dishonor advisory, non-payment advisory,  payment failure advisory) simplifies the process of issuing notices and makes it more convenient for payees.

Important Points to Remember Regarding Online Cheque Bounce Notices:

Cheque Bounce Notice MandM Law Partners
  • Ensure the email or WhatsApp message mentions the details of the bounced cheque and the demand for payment.

  • Maintain a record of sending the electronic notice (screenshots, delivery confirmation, etc.) for future reference.

  • While online notices are now considered valid, it’s still advisable to consult a lawyer for guidance on drafting a comprehensive notice.

Exemptions for Cheque Bounce Notice

Technical Error

If the cheque bounces due to a clerical error by the bank (e.g., misspelling of the payee’s name), the notice may not be maintainable.

Stop Payment Instruction

 If the drawer stops payment on the cheque before it is presented, a notice cannot be issued.

Defective Cheque

 If the cheque itself is defective (e.g., not signed, has alterations), it may not be a valid instrument for a dishonor notice.

Did You Know on Cheque Bounce Notice

Who Can Help With Queries Related To Cheque Bounce Notices In India?

Contact The Best Cheque Bounce Lawyer In Delhi And Gurugram, At M&M Law Partners. For Personalized advice on cheque bounce notices In India, it’s wise to consult legal professionals.

At M&M Law Partners, we have the best civil lawyers in Delhi and Gurugram who are experts in cheque bounce cases and offer comprehensive assistance, including drafting notices and representing clients in court, ensuring effective legal support.


1. What Is The Time Limit For Cheque Bounce Notice?

The payee has 30 days from the date of receiving the bounced cheque information from the bank to send a legal notice.

2. Who Can Send A Notice Under Section 138 For Cheque Bounce?

Only the payee (the person to whom the cheque is addressed) can initiate legal action under Section 138 of the NI Act by sending a cheque bounce notice.

3. What Is The Maximum Punishment For Cheque Bounce In India?

The maximum punishment for cheque bounce in India is imprisonment for up to two years, or a fine, or both.

4. Can I Send Legal Notice Without A Lawyer?

While it’s not mandatory, it’s advisable to consult a lawyer for guidance on drafting a comprehensive cheque bounce notice.

5. Can I Send A Cheque Bounce Notice By WhatsApp?

Yes, following the Allahabad High Court ruling, a demand notice sent electronically via WhatsApp is a valid option. However, ensure proper documentation for future reference.

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