Bounced cheques get new rules
Posted on: 28/Jul/2018 4:02:57 PM
It is likely that the Negotiable Instruments (Amendment) Bill, 2017 will soon turn into a law, especially after getting passed in the Lok Sabha. While net banking is making the rounds, Indian businesses continue to use cheques for getting or making payments to their suppliers, vendors and customers. Often times, bouncing of cheque also takes place and end up as a case in the court.
One who draws a dishonored cheque can very easily file the appeal and get stay with the proceedings of the court. Hence, cheque credibility in businesses gets reduced.
So, all you need to know about the new changes in the Negotiable Instruments Act with regards to cheque bouncing are listed below for your attention
Negotiable Instruments (Amendment) Bill, 2017 is for the purpose of amending Negotiable Instruments Act, 1881. It demands the cheque drawer who is dishonored to pay for interim compensation towards the complaint raised.
The interim compensation must not be more than 20 percent of the total cheque amount
The drawer of dishonored cheque is supposed to pay interim compensation in a summery trial/summons case. This will be applicable in cases even if the pleads dont find it guilty of the complaint or charge.
Interim compensation need to be paid out within time period of 60 days starting from the order date. Once satisfied, the court will provide an extra time period of 30 more days and not more.
When the cheque drawer is also acquitted in the same case, the repayment should be made by the complainant towards interim compensation along with interest. This repayment must be done within a period of 60 days from receiving the court order.
With the aim of reducing possible late or delayed in solution in such cases with bounced cheques, the Negotiable Instruments Bill, 2017 shall not turn into an Act until it gets passed in either of the Lok Houses. As of now, Rajya Sabha clearance is pending.
