Procedure under section 138 of Negotiable instruments Act ;1881
By Yamini Narang November 12, 2019
One of the common problem which people are facing these days are cheque bouncing. So first things first . cheque bouncing is covered u/s 138 of Negotiable instruments Act ,1881. Which formulades the remedy and procedures regarding the same.
Cases covered u/s 138 are of the nature of criminal cases ..
Let us understand the procedure of how cases u/s 138 are instituted and settled ..
1) Applicability of section 138.
A)That the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier..
B)That the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
C)That the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
2) serving the legal notice to the defaulter
3) within the limitation period filing of the case
4) verification of the complaint
5) summons to the Accused
7) examination -in- cheif and cross examination
8) judgement .
Advocate Yamini Narang
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