How a Junior Advocate Can Easily File a Cheque Bounce Case? Legal Provisions and Draft Format

A cheque bounce or dishonour of cheque is one of the most common financial disputes encountered in India. For junior advocates beginning their litigation careers, handling cheque bounce matters under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) offers both valuable court exposure and an opportunity to master procedural discipline.

This article provides a step-by-step guide on how a junior advocate can file a cheque bounce case efficiently, with references to statutory provisions, procedural tips, and a ready-to-use draft complaint format.

Legal Framework: Understanding Section 138 of the NI Act

Ingredients of Section 138:

To initiate prosecution under Section 138 of the NI Act, the following essential elements must be satisfied:

1. Cheque must be drawn for discharge of a legally enforceable debt or liability.
2. Cheque must be presented to the bank within 3 months (earlier it was 6 months, amended by RBI) from the date it is drawn.
3. Cheque is returned unpaid due to insufficiency of funds or exceeds arrangement.
4. A written demand notice is sent to the drawer within 30 days of receiving the return memo from the bank.
5. The drawer fails to make payment within 15 days from receipt of the notice.

If all these conditions are met, a complaint can be filed within one month of the cause of action (i.e., lapse of 15-day notice period).

Relevant Provisions

• Section 138 – Punishment for dishonour of cheque.
• Section 139 – Presumption in favour of holder.
• Section 142 – Cognizance of offences.
• Section 143 – Summary trial and mode of service.
• CrPC, 1973 – For procedural aspects like summons, evidence, etc.

Jurisdiction: Where to File?

As per Section 142(2) of the NI Act (post the 2015 amendment), the territorial jurisdiction lies with:

“The court within whose local jurisdiction the branch of the bank where the payee maintains the account is situated.”

So, if the payee’s bank is in Delhi, the complaint is filed in the relevant magistrate court in Delhi.

Step-by-Step Procedure to File the Case

Step 1: Collect Evidence

• Original cheque
• Bank return memo stating "insufficient funds" or similar reason
• Copy of the legal notice served to the drawer
• Postal or courier receipts and tracking
• Affidavit of service (if applicable)

Step 2: Draft and Serve the Legal Notice

• Issue a demand notice within 30 days of receipt of dishonour memo.
• Demand payment within 15 days from date of service.
• Mention cheque number, amount, reason for dishonour, and legal intent.

Step 3: Wait for the Statutory Period

• If payment is not made within 15 days of notice receipt, cause of action arises.
• You have 30 days from this date to file the complaint.

Step 4: Prepare the Complaint

• Draft a complaint with all required documents annexed.
• Include a verification affidavit by the complainant.
• File in the Magistrate Court having jurisdiction.

Step 5: Attend Pre-summoning Inquiry

• The court may examine the complainant under Section 200 CrPC.
• If satisfied, the court issues process/summons under Section 204 CrPC.

Draft Format of Complaint under Section 138 of the NI Act

IN THE COURT OF METROPOLITAN MAGISTRATE

AT [Name of City]

COMPLAINT CASE NO. ____ OF 20__

IN THE MATTER OF:

[Name of the Complainant],

S/o or D/o [Father’s Name],

R/o [Address],

...Complainant

VERSUS

[Name of the Accused],

S/o or D/o [Father’s Name],

R/o [Address],

...Accused

COMPLAINT UNDER SECTION 138 READ WITH SECTIONS 142 AND 143 OF THE NEGOTIABLE INSTRUMENTS ACT, 1881

MOST RESPECTFULLY SHOWETH:

1. That the complainant is a resident of the above-mentioned address and is competent to file this complaint.

2. That the accused is known to the complainant and had taken a hand loan of Rs. ______ for his personal/business needs on [Date].

3. In discharge of the said liability, the accused issued a cheque bearing No. ______ dated ______ drawn on ______ (Bank Name & Branch) for an amount of Rs. ______.

4. The complainant presented the said cheque through his banker [Bank Name, Branch] within its validity period. However, the cheque was dishonoured and returned unpaid with memo dated ______ for the reason “__________”.

5. The complainant sent a legal notice dated ______ via registered post/courier on ______ demanding payment of the cheque amount within 15 days. The said notice was received by the accused on ______ as per postal/courier record.

6. Despite the notice, the accused failed to make the payment within the statutory period of 15 days. Hence, the cause of action arose on ______.

7. The present complaint is being filed within the limitation period as provided under Section 142 of the NI Act.

PRAYER:

It is therefore prayed that this Hon’ble Court may be pleased to:

(a) Take cognizance of the complaint under Section 138 of the NI Act;

(b) Summon and try the accused for the offence under Section 138;

(c) Pass such other and further orders as this Hon’ble Court deems fit and proper.

[Place]

[Date]

Filed by:

[Name of the Advocate]

Advocate for the Complainant

Enrolled No: ______

Address: ______

Phone: ______

List of Annexures:

1. Copy of the cheque

2. Cheque return memo

3. Copy of legal notice

4. Postal/courier receipts

5. Tracking record

6. Affidavit and Vakalatnama

Practical Tips for Junior Advocates

• Use templates and court precedents to standardize complaint drafting.
• Always track deadlines (notice period, limitation) to avoid technical dismissals.
• Ensure proper service of notice and retain acknowledgment proof.
• Prepare your client for cross-examination in pre-summoning inquiry if required.
• Consider mediation opportunities – many courts encourage compromise under NI Act matters.

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