Draft format
Cheque bounce legal notice format under Section 138 NI Act
A demand notice is the step that turns a dishonoured cheque into a possible offence under Section 138 of the Negotiable Instruments Act, 1881. This is a standard format for that notice, with the points to check before it is sent.
Last updated 9 October 2026
When to use a cheque bounce legal notice
Use this notice when a cheque issued towards a legally enforceable debt or liability has been returned unpaid by the bank, typically for insufficient funds, a closed account or a stop-payment instruction.
The notice must be in writing and must reach the drawer's address after being sent within thirty days of the payee receiving information of the dishonour from the bank. It gives the drawer fifteen days from receipt to pay. Only if that period passes without payment does the cause of action for a complaint arise.
Legal basis: Sections 138 and 142, Negotiable Instruments Act, 1881
Cheque bounce legal notice: the format
Blanks and fields in [square brackets] are for you to complete. Adapt the wording to the facts and to the rules of the court or forum.
BY REGISTERED POST WITH A.D.
Date: [Date]
To,
[Name of opposite party]
[Address of opposite party]
Sir/Madam,
Sub: LEGAL NOTICE UNDER SECTION 138 READ WITH SECTION 142 OF THE
NEGOTIABLE INSTRUMENTS ACT, 1881 — DEMAND FOR PAYMENT OF DISHONOURED
CHEQUE AMOUNT.
Under instructions from and on behalf of my client [Name of client] (hereinafter "my Client"), I hereby serve upon you the following Notice:
1. That my Client and you are known to each other and, in the course of legally enforceable transactions between the parties, a sum of Rs. ____________ /- (Rupees ______________________ only) became due and payable by you to my Client.
2. That in discharge of the aforesaid legally enforceable debt/liability, you issued in favour of my Client Cheque bearing No. __________ dated __________ for Rs. ____________ /- drawn on __________ Bank, __________ Branch.
3. That my Client, in good faith, presented the said cheque for encashment through his banker, viz., __________ Bank, __________ Branch, on __________. The said cheque was returned dishonoured vide Cheque Return Memo dated __________ with the remarks "_________________________" (e.g., "Funds Insufficient" / "Account Closed" / "Payment Stopped by Drawer").
4. That the dishonour of the said cheque clearly amounts to an offence under Section 138 of the Negotiable Instruments Act, 1881.
5. You are hereby called upon to pay to my Client the said sum of Rs. ____________ /- being the amount of the dishonoured cheque, together with notice/legal charges of Rs. ____________ /-, within FIFTEEN (15) DAYS from the date of receipt of this notice, failing which my Client shall be constrained to initiate appropriate criminal proceedings against you under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881, before the competent court at [Place], in addition to such other civil and criminal remedies as may be available in law, entirely at your risk, cost and consequences.
6. A copy of this notice is being retained in my office for record and for the purpose of further legal action.
Yours faithfully,
___________________________
[Name of advocate], Advocate
Enrolment No.: __________
For: [Name of client]What the draft must get right
- Identify the cheque exactly: number, date, amount, bank and branch.
- State the transaction briefly so that the cheque is shown to be for a legally enforceable debt or liability, not a gift or security with nothing due.
- Give the date of presentation and the date and reason on the bank's return memo.
- Demand the cheque amount. A demand for a different or larger sum, without separately and clearly demanding the cheque amount, risks the notice being held invalid.
- Give the drawer fifteen days from receipt of the notice to pay.
- Send it to the drawer's correct address by registered or speed post with acknowledgment due, and keep the postal receipt and tracking report. Where the drawer is a company, address the company and the persons in charge of its business.
Common mistakes
- Sending the notice more than thirty days after receiving the return memo. This period cannot be condoned.
- Giving the drawer fewer than fifteen days, or filing the complaint before the fifteen days end.
- Omitting the directors or partners who were in charge of the business when a company or firm issued the cheque.
- Not keeping proof of dispatch and delivery, which is needed to plead service or deemed service in the complaint.
Cheque bounce legal notice: common questions
Must a Section 138 notice be sent by an advocate?
No. The Act requires a notice in writing from the payee or holder in due course. It may be sent by the payee personally. It is usually sent through an advocate so that the statutory requirements are met and the record is clean.
Can the notice be sent by email or WhatsApp?
The Act requires a notice in writing and does not prescribe a mode. Some High Courts have accepted notices sent electronically where delivery is proved, but the position is not uniform. Registered or speed post to the correct address remains the safe course, with electronic copies sent in addition.
What happens after the 15 days expire?
If the drawer has not paid the cheque amount, the cause of action arises on the following day and a complaint must be filed within one month of that date before the competent Magistrate.
Generate this on your letterhead in Settl
This format is in Settl's template library. Open a matter and the parties, court and dates are filled from the case record; you complete the facts, review, and export to PDF on your firm's letterhead.
Not legal advice. This is a general format for reference. It is not a filing-ready document and may not suit your facts or your court's rules. Verify the law, the facts and local requirements, and have a qualified advocate review the draft before it is sent or filed. Settl is not a law firm.