Legal Notice for Cheque Bounce in Chennai

Introduction

If your cheque bounced recently and you're thinking about filing a lawsuit against the person who drew the cheque on you in Chennai, the right thing to do would be to send a legal notice to them. Let's establish what a cheque is and what constitutes dishonor before delving into the mechanics of how to file a legal notification in Chennai.

These days, the most common way to pay is with a cheque because carrying a lot of cash comes with a lot of responsibility and duty. When a cheque is brought to a bank for clearing and the bank declines to pay the amount due because there are insufficient funds in the issuer's account, this is referred to as a "dishonored cheque" (the specifics of how to manage a dishonored cheque are detailed below). A cheque is a negotiable instrument that a person writes telling a bank to pay the bearer. 

The importance of e-Cheques in Chennai

The value of an electronic cheque remains equivalent to that of a standard paper cheque. An electronic cheque is signed electronically by the drawer, which eliminates the requirement for the drawer to physically visit the bank for submission and subsequent cashing. This is the primary difference between an electronic cheque and a paper cheque.

What elements are included in a normal Cheque in Chennai?

The eight primary parts of a cheque make it unique and the most challenging payment method in Chennai. This functions as

1. The sum in Words: The amount of consideration for which the cheque is being issued must be stated by the drawer in both words and numbers.
2. Of Bearer option: In the event that the Payee is ambiguous or not a specific person, the Drawer writes the cheque in favour of "of bearer".
3. Payee's Name: The most important information to provide on a cheque to enable the bank to release funds into the payee's account is the payee's name.
4. Date of Issuance: Since the cheque is only valid for three months after it is issued, the date the Drawer issues the cheque is printed on the cheque itself. Therefore, in order to get the cheque cashed, the Payee must bring it to the bank.
5. Account Number: Every cheque that is written on it has the drawer's account number pre-printed on it.
6. Amount of Consideration: The requirement to state the consideration for which a cheque was issued is another important component of a cheque.
7. Cheque Number: To deter any kind of manipulation, the bottom of the cheque has both a unique and a MICR number.

That being said, these are the essential elements mentioned in the Chennai inspections.

Important parties of a Cheque transaction in Chennai

Three important stakeholders are involved in a cheque transaction. The main participants in a Chennai cheque transaction are all of them.

1. Drawee: The entity that the cheque is written out to is the one that is considered the drawee. The banks are usually the drawee.
2. Drawer: As the term implies, a drawer is someone who makes a cheque payable to the bank to withdraw a certain amount of money from their account.
3. Payee: The person who will receive the funds from the bank is referred to as the payee.

What would be the reason for the dishonored cheque from Chennai?

A cheque may be returned unpaid on several accounts (listed below) at the Chennai Drawee Bank. The reasons are as follows:

1. Variations in the drawer's autograph
2. Insanity or insolvency of the Drawer resulting in a lack of consistency in the amount of thought conveyed through words or figures
3. There is no date included.
4. Not enough money in the Drawer of Cheque's haunted bank account.
5. Period's expiration, which is three months following the due date
6. The Drawer closes the account before the cheque expires.
7. On the drawer's request that the payment be stopped by a court order, and not to continue with the cheque clearing process
8. The cheque is being replaced.
9. If the Payee's name is absent or not clear

Thus, the following is the list of reasons a bank would reject a cheque. However, the aforementioned list is only suggestive and not exhaustive; additional, unlisted circumstances may also contribute to Chennai's disregard for Cheques. It depends only on the kind of transaction.

If a cheque is returned as unpaid in Chennai, what happens?

A circumstance referred to as "dishonor of the cheque" arises when a bank is unable to cash a cheque for any of the several reasons mentioned above (often due to insufficient funds in the drawer's account). In this instance, the payee receives their cheque back along with a message stating the reason it was unable to be cashed.

The bank sends a note explaining the reason for the dishonor along with the cheque that has been refused. Rather than gifts or charity contributions, in the event of responsibilities and debts, Cheque Bounce may also receive a legal notification.

Who may send out a Cheque Bounce Notice in Chennai?

The person who feels aggrieved usually sends a legal notice for Cheque Bounce in Chennai; however, if the Payee is unable to do so, they may get legal counsel to do so on their behalf. Since a legal professional will be familiar with all the legal complexities involved in the process of delivering a legal notice for Cheque Bounce in Chennai, the panel of experts has also recommended doing this.

Legal Notice of Cheque Bounce to a Company Located in Chennai

Since a corporation is a separate legal entity, if the drawer is a company, the payee is required to give the legal notice in the firm's name. The director or head of the organisation may also be included. The leader or director of the organisation may be absolved of responsibility if they can show that this was done without their knowledge and that they have implemented all appropriate safety measures.

What is the penalty for Cheque Bounce in Chennai?

The criminal offence of "bouncing" a cheque carries a maximum term of three years in prison and a fine of double the value of the cheque. If a firm commits an offence, the directors or the head of the department will be held personally liable.

What consequences could a returned cheque have in Chennai?

A Chennai cheque bounce issue has a number of detrimental elements. They are as follows:

1. Impact on Credit Score: A persistent case of a cheque bouncing may result in a reduction of the Drawer's credit score.
2. Conflict: A disagreement between the payer and the drawer that might go to court is the most harmful outcome of a bounced cheque.
3. Disrupted Payments: The Payee may go through a financial crisis if they give the bank a rejected cheque and are in need of money.

These are therefore the three main negative consequences that a returned cheque has in Chennai.

What are the necessary elements of a legal notice pertaining to a bounced cheque in Chennai?

There are many important factors that need to be considered while drafting and mailing a legal notice for a cheque bounce in Chennai. Below is a list of these elements:

1. Number of the Cheque: The cheque number must be included in a legal notification since each cheque is unique and must be presented separately.
2. Name and mailing address of each party: A legal notification for a bounced cheque in Chennai should contain the name and address of both parties. This is the most important element.
3. The Bank's explanation was: The bank's justification for the Cheque's unpaid return should be included in the legal notice as the next essential element.
4. Instruction: The Drawer is required to pay the money guaranteed by cheque to the Payee within 15 days after receiving a directive and legal notification from the Payee.
5. Criminal Complaint: In the event that the Drawer is unable to repay the money in full, this section complies with the previously mentioned guidelines for filing a criminal complaint against them.
6. Signature: As mentioned in the notice's final phase, the attorney drafting the legal notice for Cheque Bounce in Chennai needs to sign it.
7. Crucial Dates: All important dates should be included in the legal notification. The date the Payee presents the cheque and the date the Drawer drafts it must be mentioned in the legal notice.
8. The Payee shall furnish a brief synopsis of all the legal facts pertaining to the claim.
9. Relevant Provisions: Section 138 of the Negotiable Instruments Act should be mentioned in the legal notice in addition to the legal actions that can be brought against the Drawer.

These are hence the necessary elements that a Chennai legal notice for a bounced cheque must have.

The procedure to serve a legal notice for Cheque Bounce in Chennai

Consequently, there isn't a predetermined process in Chennai for sending out official notifications regarding Cheque Bounce. The Payee shall demand in writing from the Bill Drawer the amount of money guaranteed by the Bill.

After receiving a legal notice asking for payment, the Payee is required to wait an additional 15 days for the Drawer to satisfy all outstanding debts. The Payee may proceed with a criminal complaint against the Drawer if the Drawer fails to return the funds within 15 days of the legal notification being given. Within 30 days of the cheque being returned unpaid, the legal notice must be sent. A lawyer is necessary to serve a legal notice on the Drawer since they are familiar with the details of the negotiable instrument and can provide you with stronger representation while presenting your money recovery case in Chennai.

Paperwork Required to serve a Legal Notice for Cheque Bounce in Chennai

The parties need to possess the following two essential documents:

1. A replica of the bank-delivered Unsent Cheque Memo
2. An Affidavit stating the piece of evidence 
3. An additional copy of the letter of demand

To serve the Drawer with a legal notice regarding the non-payment of the monies obtained through a cheque in Chennai, the parties must bring these three documents.

Frequently Asked Questions (FAQs)

Q1: Is it possible for a Payee to file a legal notice of an electronic cheque bounce?

A: Yes, a Payee can file a legal notice for an electronic cheque bounce in Chennai. An electronic cheque is treated equally to a paper cheque.

Q2: Which court has the authority to hear a case concerning a cheque that bounces?

A: The court that has jurisdiction over a bounced cheque case is typically the court where the bank of the payee or drawer is located.

Q3: Is it possible to relocate the cases of Cheque Bounce to Chennai?

A: Yes, issues related to Cheque Bounce can be transferred outside of Chennai through legal procedures.

Q4: When is the last day to deliver a Legal Notice for Cheque Bounce in Chennai?

A: After a cheque bounces, a legal notice can frequently be served within 30 days.

Q5: Is it feasible for the Payee to file a lawsuit against the Drawer?

A: Yes, the Payee may launch a lawsuit if the Drawer continues to refuse to deliver the funds even after serving the legal notice.

Q6: Can a Chennai Lawyer Serve a Legal Notice Regarding a Bounced Cheque?

A: Yes, it is usually a good idea to deliver the legal notification of a bounced cheque to a lawyer in Chennai.

Q7: Is it possible for a Payee to file a legal notice of an electronic cheque bounce?

A: Yes, a Payee can issue a legal notice for an electronic cheque bounce in Chennai. An electronic cheque is treated equally to a paper cheque.

Q8: Which court has the authority to hear a case concerning a cheque that bounces?

A: The court that has jurisdiction over a bounced cheque case is typically the court where the bank of the payee or drawer is located.

Q9: Is it possible to relocate the cases of Cheque Bounce to Chennai?

A: Yes, issues related to Cheque Bounce can be transferred outside of Chennai through legal procedures.

Q10: When is the last day to deliver a Legal Notice for Cheque Bounce in Chennai?

A: Generally, a legal notice for a cheque bounce must be delivered within 30 days of the cheque bouncing in Chennai.

Q11: Is it feasible for the Payee to file a lawsuit against the Drawer?

A: Yes, the Payee may initiate a lawsuit if the Drawer refuses to provide the funds even after receiving the legal notice.

Q12: Can a Chennai Lawyer Serve a Legal Notice Regarding a Bounced Cheque?

A: Yes, it is recommended to engage a lawyer based in Chennai to serve a Legal Notice regarding a bounced cheque for better understanding of local laws and procedures.

Q13: What are the consequences of ignoring a legal notice in a bounced cheque case in Chennai?

A: Ignoring a legal notice in a bounced cheque case in Chennai may result in further legal action and potential consequences such as fines or imprisonment.

Q14: Is mediation an option for resolving bounced cheque cases in Chennai?

A: Yes, mediation can be pursued as an alternative dispute resolution method in bounced cheque cases in Chennai if both parties agree to it.

Q15: Can bounced cheque cases in Chennai be settled out of court?

A: Yes, bounced cheque cases in Chennai can be settled out of court through negotiations and reaching a mutual agreement between the parties involved.