Recovery 6 Oct 2026 8 min read

Cheque bounce notice format under Section 138 (with sample)

What a Section 138 demand notice must contain, the deadlines it has to meet, and a sample format you can follow — with the mistakes that get complaints dismissed.

Accellaw Editorial

A demand notice is the step that turns a bounced cheque into an enforceable claim. Section 138 of the Negotiable Instruments Act, 1881 makes dishonour of a cheque an offence only if the payee sends a written demand within the time allowed and the drawer then fails to pay. A notice that is late, vague about the amount, or sent to the wrong address can cost you the criminal remedy altogether.

When the notice must be sent

The cheque must have been presented within its validity period — three months from the date on the cheque.
The notice must be sent within 30 days of receiving the bank's return memo (Section 138, proviso (b)).
The drawer has 15 days from receiving the notice to pay (proviso (c)).
If the drawer does not pay, the complaint must be filed within one month after those 15 days end (Section 142(1)(b)). A court can condone a short delay only if you show sufficient cause.

A cheque can be presented again within its validity, and a fresh return memo starts a fresh 30-day window. But once a notice has been sent and the 15 days have passed, the complaint has to follow from that notice.

What the notice must contain

The name and address of the drawer — the person or company that issued the cheque — and of the payee.
The cheque number, date, amount, bank and branch.
The date of presentation, the date of the return memo, and the reason for return as stated on the memo.
The debt or liability the cheque was given for: the loan, invoice or agreement behind it.
A clear demand to pay the cheque amount within 15 days of receiving the notice.
A statement that, failing payment, proceedings under Sections 138 and 142 will be initiated.

The demand must be for the cheque amount. Interest, costs or other sums can be claimed, but they should be shown separately so that the demand for the cheque amount itself is unambiguous — the Supreme Court has held that a notice is defective if the cheque amount cannot be made out from it.

Sample format

Sample — adapt to your facts

[On advocate's letterhead] Date: [DD Month YYYY] By Registered Post A.D. / Speed Post To, [Name of drawer] [Full address] Subject: Legal notice under Section 138 of the Negotiable Instruments Act, 1881 for dishonour of cheque no. [number] Sir / Madam, Under instructions from my client, [name of payee], residing at / having its office at [address] ("my client"), I serve you with the following notice: 1. You are liable to pay my client a sum of ₹[amount] towards [nature of debt — e.g. goods supplied under invoice no. ___ dated ___ / loan advanced on ___]. 2. In discharge of that liability, you issued cheque no. [number] dated [date] for ₹[amount], drawn on [bank and branch], in favour of my client. 3. My client presented the cheque for payment through [bank and branch] on [date]. The cheque was returned unpaid with the remark "[reason as on memo — e.g. Funds Insufficient]", by return memo dated [date], received by my client on [date]. 4. You are hereby called upon to pay the said cheque amount of ₹[amount] to my client within 15 days of receipt of this notice. 5. If you fail to make the payment within that period, my client will be constrained to initiate proceedings against you under Sections 138 and 142 of the Negotiable Instruments Act, 1881, and such other civil and criminal proceedings as may be available, entirely at your risk as to costs and consequences. A copy of this notice is retained in my office for further action. [Advocate's name] Advocate for [name of payee] [Enrolment no., address, contact]

Sending the notice

Send the notice by registered post with acknowledgement due or by speed post to the drawer's last known address, and keep the postal receipts and tracking record. Under Section 27 of the General Clauses Act, 1897, a notice correctly addressed and sent by registered post is presumed served, even if the drawer refuses or avoids it. Where the drawer is a company, address it to the company and its directors responsible for its business, because Section 141 extends liability to them.

Mistakes that weaken the case

Sending the notice after the 30-day window, or filing the complaint before the 15 days have run.
Demanding a lump sum that mixes the cheque amount with interest and costs.
Leaving out the debt behind the cheque. Section 139 presumes the cheque was given for a debt, but the drawer can rebut that presumption, so your notice and records should support it.
Sending the notice to an old or incomplete address with no proof of dispatch.

After the notice

If the drawer pays within 15 days, the matter ends there. If not, the complaint is filed in the court with jurisdiction over the branch of your bank where the cheque was presented (Section 142(2)). The court can order the drawer to pay interim compensation of up to 20% of the cheque amount (Section 143A), and the offence is compoundable, so many cases settle once proceedings begin. On conviction, the punishment is imprisonment of up to two years, a fine of up to twice the cheque amount, or both.