Cheque bouncing- how to contest the case

 1) This is very important for issuer of a cheque to know how to contest Cheque bouncing case. Cheque bouncing is a criminal offence and Section 138 provides punishment as “imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both”.

Therefore, if a cheque bounce case has been filed against someone and he receives summons from the competent court, the case should be contested properly with assistance of a competent lawyer, else the consequences are severe.

 2) As provided under Section 139 of the Negotiable Instruments Act, 1881, in a cheque bouncing case the issuer/accused is presumed guilty since beginning of the trial and he has to rebut such presumption or prove his innocence, although the degree of such proof of innocence is not required to be ‘beyond reasonable doubt’ and may be that of ‘preponderance of probability’, i.e.  a defence based on written or documentary evidence which may be believed and which could cast clouds of doubt over the case of the complainant.

Hence, the defence should not be a mere story-telling without any supporting document. Such document should preferably be dated prior to the date of bouncing, i.e. the date of return of the cheque unpaid by the bank. After arranging all evidences in his favour and preparing a ‘valid’ defence based on ‘preponderance of probability’, he should not deviate at any stage of trial.

3) Now we should know the stages of trial when the accused will be allowed or asked by the court to put forth his defence. These stages are:

   i) Framing of notice under Section 251 of Cr.P.C.: This stage comes immediately after acceptance of bail bonds furnished by the accused. At this stage, the court asks the accused as to whether he has committed the offence or not. If the accused admits the guilt, the court will immediately give him punishment. If the accused submits that he has not committed the offence, the court generally asks “anything more you have to say”, and in reply thereto the accused should submit his defence in brief, preferably in four-five sentences, as prepared earlier and thereafter, the court may post the matter for complainant evidence.

   ii) During complainant evidence generally the complainant himself examined as ‘CW-1”, i.e. complainant witness-1, followed by other witnesses as per list of witnesses filed by the complainant. For examination of complainant as witness in a cheque bounce case, he must file application under Section 145(2) of N.I. Act seeking permission for the same, which is generally granted.

4) There are two parts of examination of witness in any case. First part is ‘examination-in-chief’ in which the witness submits his story on his own without any interruption from opposite side with production of documents in support thereof at relevant time which are marked as exhibits in sequence of their production. During trial of cheque bounce case, the complainant normally adopts his written evidence in ‘examination-in-chief’ which he had earlier filed along with complaint as ‘pre-summoning evidence’.

After completion thereof, in the second part ‘cross-examination’ of witness starts, in which the opposite party or his counsel asks questions related to the case in order to falsify the story put forth by the complainant. During cross-examination of complainant in a cheque bounce case endeavor should be made to raise questions or suggestions not only to falsify the story of the complainant but also to support the defence taken by the accused. Questions should be asked so tactfully and in such a manner that complainant contradict his own statement made earlier.

1. When the complainant evidence is concluded or closed, the defence evidence starts in which the accused must put forth his defence. In this stage statement of accused is recorded under Section 313 of Cr.P.C. At this stage questions raised to the accused are quite similar to that under Section 251 of Cr.P.C., i.e. framing of notice, for all practical purposes although statutory provisions are different. The accused should repeat his answers as in her earlier statement.
2. Thereafter examination-in-chief of the accused starts in which the accused must elaborate his defence supported with documentary evidence which will be marked as ‘exhibits’ in sequence of their production. The accused should elaborate in such manner and language that he could not be falsified by the complainant or his counsel during his cross-examination thereafter.

 5) Now the crucial question is, which defence(s) taken by the accused may be considered by the court? Some common defences are as below:

1. Bounced cheque was given as security and not against any existing debt or liability.
2. Bounced cheque was lost and missing report or N.C.R. was lodged with the police prior to the date of bouncing of cheque.
3. Any column of bounced cheque was left blank at the time of handing over the same and it was filled with any consent from the drawer. But such plea may not be considered by the court in the absence of any document signed by the complainant/drawee reflecting the same.
4. Raising the doubt on financial capacity of the complainant to advance the loan amount in cash, if mentioned in the complaint.
5. By pointing out some loopholes in the story of the complainant.
6. In case the cheque was returned unpaid due to ‘stop payment’ instructions and there was sufficient balance in the account of the drawer to honour the cheque when the cheque was presented for encashment, then the drawer/accused may claim that the cheque was issued for performance of contract in which the complainant failed, hence the accused issued ‘stop payment’ instructions to his bank.

 6) If the accused succeeds to make believe the court his defence with supporting document(s) or to disbelieve the story/fact of the complainant, he will be able to rebut the presumption against him as mentioned in Section 139 of the N.I. Act on ‘preponderance of probability’ as has been elaborated by the Hon’ble Supreme Court in various judgments including Kumar Exports Vs. Sharma Carpets, (2009) 2 SCC 513, and the accused will be acquitted.

Conclusion- It is important to note that the specific steps and procedures for contesting a bounced check may vary depending on the jurisdiction. You should consult with an advocate or research the laws in your area to determine the best course of action.

By- Advocate Vijay K.