I Received a Cheque Bounce Notice — What Should I Do? (Hyderabad Guide)
Receiving a legal notice for a bounced cheque is frightening — it mentions criminal proceedings, imprisonment and a deadline. Most people either panic or ignore it. Both reactions make things worse.
The short version: you have 15 days from receiving the notice. What you do in that window largely decides whether this becomes a criminal case at all. This guide explains your actual options, in plain language.
First, understand what the notice is
A notice under Section 138 of the Negotiable Instruments Act, 1881 is a demand for payment of a cheque that was dishonoured. It is not a court case, a warrant, or a conviction. It is the step the law requires before a complaint can be filed.
The person who received your cheque cannot go to court until they have sent this notice and waited 15 days from your receipt of it. That waiting period exists for your benefit — it is your opportunity to resolve the matter.
The 15-day window: your four options
1. Pay the amount
If the money is genuinely owed and you can pay, paying the cheque amount within 15 days ends it. No offence is made out and no complaint can be filed on that dishonour. Pay traceably — bank transfer, not cash — and keep the acknowledgement.
2. Reply disputing the claim
If you dispute the debt, or the cheque was misused, reply in writing within the window setting out your position clearly and factually. This matters more than people realise: your reply becomes part of the record, and a court will later compare your defence at trial with what you said at this stage. A defence raised for the first time months later carries far less weight than one stated immediately.
Equally, a careless reply can damage you — an inadvertent admission of liability, or an offer to pay framed the wrong way, can be used against you. This is the point at which advice is genuinely worth taking.
3. Negotiate a settlement
The offence is compoundable under Section 147, and settlement is how a large proportion of these matters actually end. If you owe the money but cannot pay it at once, an instalment arrangement recorded properly is usually available and is often acceptable to the other side — recovering money matters more to most complainants than a conviction.
4. Do nothing
This is the option most people choose, and it is the worst one. Silence does not make the matter go away: after 15 days a complaint can be filed, you will be summoned, and you will then be defending a criminal case having already lost the chance to resolve it cheaply.
What happens if a complaint is filed
- Summons. The court issues summons requiring you to appear. Ignoring summons can escalate to a warrant — attend, or have your advocate seek exemption properly.
- Appearance and bail. On appearance, these matters ordinarily proceed with the accused on bail.
- Plea. The substance of the accusation is put to you.
- Complainant’s evidence, commonly on affidavit under Section 145, followed by your cross-examination.
- Your defence evidence and final arguments.
Be aware of Section 143A: during trial the court may direct you to pay interim compensation of up to 20% of the cheque amount, even before any finding of guilt. And if you are convicted and appeal, Section 148 allows the appellate court to require a deposit of at least 20% of the fine or compensation.
Defences that genuinely work — and those that don’t
Section 139 raises a presumption that the cheque was issued for a legally enforceable debt. The presumption is rebuttable, but the burden is on you to raise a probable defence. Realistically, the defences that succeed are:
- No legally enforceable debt existed — or it was already repaid, and you can show it;
- The notice was defective — it made no clear demand for the cheque amount, went to a wrong address, or mixed the cheque amount with unrelated claims;
- A deadline was missed by the complainant — presentation after validity, notice after 30 days, or complaint after one month;
- A blank or security cheque was filled in contrary to the agreed arrangement, where that arrangement can be evidenced;
- Material alteration of the cheque, or a signature that is not yours.
Defences that generally fail: saying only that it was a “security cheque”; saying you had no funds; claiming you never received a notice that was correctly addressed and posted; or arguing that the debt is disputed without any supporting material.
What not to do
- Do not ignore the notice — the window closes and does not reopen.
- Do not issue a replacement cheque casually — a second dishonour compounds the problem.
- Do not make part payment without documenting it — undocumented cash payments are extremely hard to prove later.
- Do not admit liability in writing while intending to contest — reply carefully, ideally with advice.
- Do not destroy or hide records. Ledgers, messages and receipts that show the true state of the account are usually your best evidence.
Gather these documents now
- The notice itself and the envelope showing the date of receipt
- Any agreement, loan document or invoice relating to the transaction
- Bank statements showing payments already made
- Correspondence — messages, emails, letters — about the debt or the cheque
- Anything showing the circumstances in which the cheque was handed over
Related guides
- Cheque bounce cases in Hyderabad — the complete guide
- Free deadline calculator
- What a valid notice must contain
Frequently asked questions
I received a cheque bounce notice. Will I be arrested?
No — a notice is a demand for payment, not a warrant, and no arrest follows from it. If a complaint is later filed you will be summoned to appear, and these matters ordinarily proceed with the accused on bail. Ignoring summons, however, can escalate matters, so respond properly at every stage.
How many days do I have to respond?
Fifteen days from the date you receive the notice. Paying the cheque amount within that window means no offence is made out. If you dispute the claim, reply within the same window.
Should I reply to the notice myself?
You can, but the reply is used later in court, and careless wording — an unintended admission, or a badly framed offer to pay — can weaken your position for the rest of the case. This is a stage where a properly drafted reply is worth far more than it costs.
The cheque was given as security, not for a debt. Is that a defence?
On its own, usually not. Courts have held that if a legally enforceable debt existed when the cheque was presented, the “security” label is not by itself an answer. It can matter where you can show the specific arrangement and that the cheque was filled in or presented contrary to it.
I genuinely owe the money but cannot pay it all now. What are my options?
Say so and negotiate. The offence is compoundable under Section 147, and instalment settlements recorded before the court are common. Most complainants prefer recovering money to obtaining a conviction.
What if I never received the notice?
Service is judged on whether the notice was correctly addressed and dispatched, not only on whether you actually collected it. If it went to a genuinely wrong address, that can be raised — but “I did not collect the post” is rarely sufficient by itself.
Can the case be settled after it is filed in court?
Yes. Settlement is possible at any stage, including during trial and even at the appellate stage, and courts actively encourage it.
This guide is general legal information published for public awareness by Musab Hashmi & Associates, Advocates, Hyderabad. It is not legal advice, does not create an advocate–client relationship, and should not be acted upon without advice on your specific facts.