A cheque dishonour case is one of the most common legal matters in Bangladesh. When a cheque is returned unpaid by the bank, the payee has a legal right to initiate criminal proceedings against the drawer under Section 138 of the Negotiable Instruments Act 1881 (NI Act). This is a powerful legal remedy that can result in imprisonment of up to one year and/or a fine of up to three times the cheque amount. TRW — Tahmidur Rahman Remura Wahid Law Associates handles cheque dishonour cases from the legal notice stage through to final judgment and execution.
Legal Framework: Section 138 of the NI Act
Section 138 of the Negotiable Instruments Act 1881 (as amended in Bangladesh) provides that where a cheque drawn by a person on an account maintained by them with a bank for the payment of any amount of money to another person from out of that account is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account, such person shall be deemed to have committed an offence. The punishment is imprisonment for a term which may extend to one year, or a fine which may extend to three times the amount of the cheque, or both. Section 138A creates a presumption in favour of the holder that the cheque was issued for the discharge of a legally enforceable debt or liability.
Prerequisites for Filing a Cheque Dishonour Case
Before filing a cheque dishonour complaint, the following conditions must be satisfied. First, the cheque must have been returned unpaid by the bank. The bank's return memo (cheque return slip) is the primary evidence of dishonour. Second, the cheque must have been issued for the discharge of a legally enforceable debt or liability. Third, the payee must have sent a written legal notice to the drawer within 30 days of receiving the cheque return memo, demanding payment of the cheque amount. Fourth, the drawer must have failed to make payment within 30 days of receiving the legal notice. Fifth, the complaint must be filed within 30 days of the expiry of the 30-day notice period. These limitation periods are strict and must be observed carefully.
Step 1: Sending the Legal Notice
The legal notice is the first and most critical step in a cheque dishonour case. TRW drafts a comprehensive legal notice that clearly identifies the cheque, the date of dishonour, the bank's return memo, the amount due, and the demand for payment within 30 days. The notice is sent by registered post with acknowledgment due (RPAD) to ensure proof of delivery. TRW also advises on whether the notice should be sent to the drawer personally, to the company (if the cheque was issued by a company), and to the directors (for director liability under Section 141 of the NI Act). See our detailed guide on cheque dishonour legal notices in Bangladesh.
Step 2: Filing the Criminal Complaint
If the drawer fails to pay within 30 days of receiving the legal notice, TRW files a criminal complaint before the Chief Metropolitan Magistrate (CMM) Court in Dhaka (or the Chief Judicial Magistrate Court in other districts). The complaint is filed under Section 138 of the NI Act and must be accompanied by the original cheque, the bank's return memo, the legal notice, and proof of delivery of the notice. TRW drafts the complaint in a form that maximises the chances of the court taking cognisance and issuing summons to the accused.
Step 3: Court Proceedings
After the complaint is filed, the court takes cognisance of the offence and issues summons to the accused. The accused appears before the court and the trial proceeds. TRW represents the complainant throughout the trial, examining witnesses, producing documentary evidence, and arguing the case. The accused has the right to cross-examine the complainant's witnesses and to produce their own evidence. The court ultimately delivers a judgment — either convicting the accused (with the prescribed punishment) or acquitting them. TRW also advises on the possibility of a compromise or settlement, which is common in cheque dishonour cases.
Limitation: The Critical Deadlines
The limitation periods in cheque dishonour cases are strict and non-extendable. The legal notice must be sent within 30 days of receiving the cheque return memo. The complaint must be filed within 30 days of the expiry of the 30-day notice period. Missing either of these deadlines bars the complainant from filing a case under Section 138. TRW calculates these deadlines precisely and ensures that all steps are taken within the prescribed time. See our guide on cheque dishonour case limitation in Bangladesh.
How Barrister Tahmidur Rahman Can Help
Barrister Tahmidur Rahman and TRW's cheque dishonour team handle cases from the legal notice stage through to final judgment. Contact TRW at https://tahmidurrahman.com/contact/.
Frequently Asked Questions
Q: What is the punishment for cheque dishonour in Bangladesh?
A: Imprisonment for up to one year, and/or a fine of up to three times the cheque amount.
Q: Can a company be prosecuted for cheque dishonour?
A: Yes. Under Section 141 of the NI Act, the company and every person responsible for the conduct of the company's business at the time of the offence can be prosecuted.
Q: Can the case be settled out of court?
A: Yes. Cheque dishonour cases are commonly settled by payment of the cheque amount plus interest and costs. TRW advises on settlement negotiations.
