What to do When Cheque Dishonour or Bounce in Bangladesh? How can you take legal actions to retrieve your money? This post provides complete overview of how to deal with cheque dishonouring in Bangladesh.

Cheque Dishonour or Bounce in Bangladesh

The Bangladesh government has taken a number of steps to provide adequate legal remedy in order to address and mitigate this situation.

The most important law enacted to provide legal recourse in such a situation is known as the Negotiable Instruments Act (Act No. XXVI of 1881) (“NI Act”). Section 6 of the Northern Ireland Act defines a cheque as “a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand.”

Cheque Dishonour or Bounce – In Laws of Bangladesh

Furthermore, a cheque has been defined in case law as an order issued by a creditor to a debtor to pay the whole or part of a debt to a third party. If a cheque fails to clear due to insufficient funds, or if the person who gave the cheque directed his bank to cancel the said cheque, or for any other reason, the remedy is provided by Section 138 of the NI Act.

To begin, Section 138 of the NI Act makes it clear that whenever a cheque is bounced, an illegal offence is created, which carries a criminal penalty of one year in prison or a fine of three times the amount of the dishonoured cheque, or both. Furthermore, the aggrieved person has a civil remedy under the same section, and in order to obtain the civil remedy, the person must follow certain procedures.

The court will first consider whether the cheque was presented to the bank for withdrawal within six months of being given to the person who is suing. If the cheque was presented to the bank for withdrawal after six months of it being given to the person who was wronged, the court will dismiss the claim.

If the cheque is presented within the required time frame and the cheque is dishonoured, the aggrieved party must send a written notice via registered post with acknowledgment due to the person who gave the cheque demanding the money back, according to Section 138 of the NI Act.

This notice requesting the money must be sent within 30 days of the cheque being bounced, which is when the aggrieved party was notified that the cheque that was given bounced due to insufficient funds or any other reason. Again, if the notice demanding payment is not sent within the required time frame, the court will provide no remedy.

If the above-mentioned procedure is followed and the person who received the notice does not pay back the money within 30 days of receiving the notice, the aggrieved party may file a civil claim against that person to recover the money.

Finally, in cases of dishonoured cheques, the time it takes to complete all of the necessary procedures before filing a claim is critical. The NI Act is both balanced and timely, so it is well equipped to deal with and provide effective remedies in cases of dishonoured cheques.

Steps of Filing a Case for Cheque Bounce in Bangladesh

Under the following conditions, the recipient of the check may file a case against the applicant:

(A) Depositing the check at the bank:

The default check must be presented to the bank for encashment within six months of being drawn. If the check is dishonored, the bank must issue a slip as a result of the dishonour.

(B) Legal Disclaimer:

After receiving a check dishonor slip from the bank, the payment application must be made by notifying the check’s giver via registered mail within 30 days. For the next 30 days, the recipient will return the money.

Section 138 Implementation

Unless the giver of the check fails to pay the stated amount of money within 30 days of receiving the notice, the receiver of the check shall file a case under Section 138 of the Negotiable Instruments Act, 1881.