The complete Section 138 toolkit for both sides — send the statutory demand notice, file the complaint, defend a notice you've received, claim interim compensation, or settle and compound. Built on the strict NI Act timelines so you don't lose your remedy.
Your cheque bounced. Send the statutory demand notice within 30 days, file the Section 138 complaint after the notice period, and seek interim compensation while the case runs.
Don't ignore it. Put your defence on record with a reasoned reply, rebut the presumption of liability, and — where it makes sense — settle and compound to close the matter.
Section 138 of the Negotiable Instruments Act, 1881 makes it an offence when a cheque is dishonoured for insufficient funds and the drawer fails to pay after receiving a statutory demand notice.
The statutory demand notice must be sent within 30 days of receiving the cheque-return memo from the bank. The drawer then has 15 days from receipt of the notice to make payment.
A complaint can be filed after the 15-day notice period lapses without payment, and within one month of the cause of action arising (Section 142).
Section 138 carries imprisonment of up to 2 years and/or a fine of up to twice the cheque amount. The offence is compoundable under Section 147, so it can be settled.
Yes. Under Section 143A the court may direct the accused to pay interim compensation of up to 20% of the cheque amount during the pendency of the trial.