In today’s fast-paced world, cheques are still utilized as a prevalent mode of payment, particularly for larger transactions. However, issuing a cheque comes with the inherent risk of a Cheque Bounce, which can lead to legal trouble and damage your payment credibility.

In this blog let us look into the world of cheques, and How To Avoid Cheque Bounce Cases.

How To Avoid Cheque Bounce Case?

Cheque Bounce Cases can be a source of legal trouble and financial strain. The Negotiable Instruments Act, of 1881, lays out the legal framework governing cheques in India. Section 138 of this Act deems the dishonor of a cheque due to insufficient funds or exceeding the arranged amount a criminal offense.

This can lead to imprisonment of up to two years or a fine amounting to double the cheque amount. How to avoid a cheque bounce case? This is the question, everyone asks. Right. Here is the answer


Payment stability and fund protection are important when dealing with cheques. By adopting cheque non-bounce solutions and bounce avoidance strategies, you can significantly minimize the risk of encountering a cheque bounce case.

How To Write A Cheque To Avoid A Cheque Bounce ?

How To Write A Cheque To Avoid A Cheque Bounce
How To Write A Cheque?

  • Account Verification: Always double-check the account number and name of the payee before filling out the cheque. A minor discrepancy can lead to rejection and a potential bounce.

  • Amount Accuracy: Write the cheque amount both in words and numerals. Ensure they correspond exactly. Any discrepancy can flag the cheque for dishonor.

  • Date and Signature: Fill in the current date and sign the cheque within the designated box. An undated or unsigned cheque is invalid.

  • Crossing the Cheque: Draw two parallel lines across the top left corner of the cheque. This restricts encashment only through a bank account, enhancing payment reliability.

  • Maintain Minimum Balance: Many banks mandate a minimum balance requirement in your account to process cheques. Maintain sufficient funds to cover the cheque amount and any potential bank charges to avoid a bounce due to insufficient funds.

Tips For Issuers On How To Avoid Cheque Bounce Case

Tips For Issuers On How To Avoid Cheque Bounce Case

As an issuer of a cheque, the burden lies on you to ensure sufficient funds are available at the time of encashment. Here are some key cheque non-return methods to safeguard yourself and How to avoid cheque bounce cases:

1. Maintain a Cheque Book Register: Record every cheque issued, including the date, payee name, amount, and purpose. This detailed record-keeping helps you monitor your account activity and identify potential differences that could lead to a bounce.

2. Reconcile Your Bank Statements Regularly: Regularly reconcile your bank statements with your cheque book register to ensure all transactions are accurately reflected. This timely identification of errors or unauthorized debits can prevent a cheque bounce due to insufficient funds.

3. Avoid Post-Dated Cheques Unless Necessary: A post-dated cheque indicates a future date for encashment. Issuing such cheques should be a last resort, as forgetting about them or having insufficient funds on the specified date can result in a bounce.

4. Inform Your Bank About Large Transactions: If you plan to issue a high-value cheque, it’s advisable to inform your bank beforehand. This notification minimizes the risk of the bank flagging the transaction as suspicious and potentially bouncing the cheque.

5. Consider Alternative Payment Methods: In today’s digital age, explore alternative payment protection options like electronic fund transfers (EFTs) or Real-time Gross Settlement (RTGS) for quicker and more bounce-proof transactions.

    Preventive Measures For Recipients On How To Avoid Cheque Bounce Case

    Preventive Measures For Recipients On How To Avoid Cheque Bounce Case

    The following are the preventive measures for recipients on how to avoid cheque bounce case

    Before Accepting a Cheque:
    • Verify Issuer Credibility: Inquire about the issuer’s reputation and financial standing, if possible. This can help assess the risk of a cheque bounce due to insufficient funds (NSF).
    When Accepting a Cheque:
    • Caution with Post-Dated Cheques: Don’t accept post-dated cheques unless absolutely necessary. If you do, ensure you understand the future date and only deposit the cheque after that date to avoid bounce due to an “out-of-date” status.

    • Confirm Cheque Validity: Look for any signs of alterations or damage on the cheque, which could lead to a bounce due to an “altered cheque” or “damaged cheque” reason.
    After Accepting a Cheque:
    • Prompt Deposit: Deposit the cheque at your bank as soon as possible, ideally within 3 months from the cheque date. This helps avoid issues with “stale cheques” that are outside their validity period.

    • Confirmation After Deposit: Don’t solely rely on the cheque; check with your bank to verify successful clearance before acting on the funds received. This ensures there are no unexpected bounces due to other reasons like stopped payments or frozen accounts.
    did you know on "Tips For Issuers On How To Avoid Cheque Bounce Case"

    To Know More Details on How To Avoid Cheque Bounce Cases In India:

    If you encounter a cheque bounce situation and don’t know How To Avoid a Cheque Bounce Case or require bounce prevention measures customized to your specific circumstances, seeking legal counsel is highly recommended.

    M&M Law Partners, a reputed law firm in Delhi and Gurugram, has extensive experience handling Cheque Bounce Cases. Our team of accomplished lawyers can provide expert advice on navigating the legalities and protecting your payment security.

    Contact M&M Law Partners today to schedule a consultation and ensure cheque non-return peace of mind.


    How Do I Save Myself From A Cheque Bounce Case?

    Maintain sufficient funds, write cheques carefully, issue dated cheques cautiously, and consider alternative payment methods for large transactions.

    What Are The Chances Of Winning A Cheque Bounce Case?

    The win rate in cheque bounce cases depends on cheque validity, the reason for bounce, and your defense. Consulting a lawyer can provide a more accurate assessment of your specific situation.

    What Is 20 Percent In Cheque Bounce Case?

    The 20% concept in cheque bounce cases applies to appeals, not the standard case. If appealing a court decision, you may need to deposit 20% of the awarded amount.

    Can 138 And 420 Be Filed Together?

    No, Section 138 addresses cheque bounce due to insufficient funds, while Section 420 deals with fraud. They are separate offenses, so they typically cannot be filed together.

    How Do You Come To Know That The Cheque Is Bounced?

    Your bank will inform you about the cheque dishonor (bounce) through a statement or notification.

    Which Court Does A Cheque Bounce Case Go To?

    The case is usually filed in the court with jurisdiction where the cheque bounced or where the payee resides.

    Can A Warrant Be Issued In A Cheque Bounce Case?

    Yes, in severe cases, the court may issue a warrant for the issuer’s arrest if they fail to appear for hearings.

    What Is An Overdraft Line Of Credit?

    An overdraft line of credit is a pre-approved loan linked to your checking account that covers insufficient funds for a limited time, typically with fees.

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