Answer By law4u team
In a cheque bounce case in India, a legal notice is a formal communication sent by the payee (the person to whom the cheque was issued) to the drawer (the person who issued the cheque) after the cheque has been dishonored or bounced. The purpose of the legal notice is to inform the drawer about the dishonor of the cheque and to demand payment of the amount within a specific period. Importance of Legal Notice in a Cheque Bounce Case: Mandatory Requirement: As per Section 138 of the Negotiable Instruments Act, 1881, sending a legal notice is a mandatory step before filing a criminal complaint for dishonor of a cheque. The payee cannot directly file a complaint in court without sending the notice first. Creates Legal Validity: The notice serves as a formal communication and a legal record of the demand for payment. It acts as a foundation for any future legal action, such as filing a complaint under Section 138. Steps in Sending a Legal Notice for a Cheque Bounce: Dishonor of Cheque: When the cheque is presented for payment, and it is returned unpaid by the bank due to reasons like insufficient funds, closure of account, or signature mismatch, the payee is informed of the dishonor. Time Limit for Sending the Notice: The payee has to send the legal notice to the drawer within 30 days from the date of receiving the intimation from the bank regarding the dishonor of the cheque. The drawer must then respond to the notice within 15 days from the receipt of the notice. Content of the Legal Notice: The notice must contain specific details: Date of the cheque: Mention the date when the cheque was issued. Cheque number: Mention the cheque number that was dishonored. Amount of the cheque: State the amount for which the cheque was issued and which has not been paid. Reason for dishonor: Mention the reason provided by the bank for the dishonor (e.g., insufficient funds, account closed, etc.). Demand for payment: The notice should demand the payment of the dishonored amount along with interest (if applicable) within 15 days from the date of receipt of the notice. Intimation of legal consequences: It should state that if the drawer fails to make payment within the stipulated period, legal action will be initiated under Section 138 of the Negotiable Instruments Act. Mode of Sending the Notice: The legal notice should be sent by registered post with acknowledgment due (to ensure receipt of the notice). Alternatively, the notice can be sent by courier or speed post with acknowledgment. Failure to Respond: If the drawer does not respond to the legal notice or fails to make payment within 15 days, the payee has the option to file a criminal complaint under Section 138 of the Negotiable Instruments Act before the Magistrate Court. The complaint must be filed within 1 month from the expiry of the 15-day period for response. Consequences of Non-Compliance with the Legal Notice: If the drawer does not pay within the prescribed 15 days after receiving the notice, the payee can initiate legal proceedings against the drawer for dishonoring the cheque. The drawer, if found guilty in a court of law, may face punishment of up to 2 years of imprisonment, or a fine which can extend to twice the amount of the cheque (i.e., the amount mentioned in the dishonored cheque), or both. Conclusion: A legal notice in a cheque bounce case is an essential step in the legal process, enabling the payee to formally notify the drawer about the dishonor of the cheque and demand payment. The legal notice serves as a precursor to filing a criminal complaint if the drawer does not comply with the demand for payment within 15 days. It is important that the notice is drafted accurately and sent through an appropriate mode to ensure that it is legally valid.
