No, but you have to change gear. The dishonour you are holding will not support a complaint, because the demand notice is a condition of the offence itself and the thirty days for it have gone. What survives is the cheque, provided it has not expired, and the debt behind it, which never depended on the notice at all. The full sequence of dates is set out in our answer on the cheque bounce time limits and the notice itself in our guide to the Section 138 notice. This answer deals only with the situation where that window has been missed.
Why can the court not condone my late notice?
Because the notice is not a procedural step. It is part of the definition of the offence. Section 138 of the Negotiable Instruments Act, 1881 says that nothing in the section applies unless three things happen: the cheque is presented within six months of its date or within its validity, whichever is earlier, the payee gives a written demand within thirty days of receiving information from the bank that the cheque was returned unpaid, and the drawer fails to pay within fifteen days of receiving that demand. Miss the second and there is no offence to complain about.
People confuse this with the proviso to Section 142(1)(b). That proviso lets the court take cognizance of a complaint filed after the one month period if you satisfy it that you had sufficient cause for the delay. Read it again. It speaks of the complaint. It says nothing about the notice. A court asked to excuse a notice sent on day forty has no power to do so, however good the reason.
Can I present the cheque again?
Yes, if it is still alive, and this is the route that saves most of these cases. A cheque can be presented more than once within the period fixed by clause (a) of the proviso: six months from the date it bears, or its stated validity, whichever comes first. Read the cheque and ask your bank before you present, because banks apply a shorter validity in practice than the six months the Act mentions. Each fresh return by the bank produces a fresh return memo, and receipt of the bank information about that fresh dishonour starts the thirty days again.
The doubt used to be whether a complainant who let one notice period lapse could rely on a later dishonour. In MSR Leathers v. S. Palaniappan, decided on 26 September 2012 by a three judge bench, the Supreme Court overruled the earlier view in Sadanandan Bhadran and held that a prosecution based on a second or successive dishonour of the cheque is permissible, so long as it satisfies the requirements of the proviso to Section 138. The Court also noted that a holder is entitled to give the drawer time to arrange funds rather than rush to court on the first bounce. So a second presentation is not a trick, it is the ordinary working of the section.
Two cautions. Do not send a second notice on the same dishonour and hope to count from it, because the notice must follow a return memo. And do not present again if the drawer has told you in writing that the account is closed or that payment has been stopped, without first reading our note on which return reasons attract Section 138, in the time limits answer linked above. Most such memos still attract the section, but the wording matters.
What if the cheque has already expired?
Then the criminal route is closed for that cheque and you recover as a creditor. There are two ways to frame the suit. The first is a suit on the cheque itself. Section 6 of the Negotiable Instruments Act defines a cheque as a bill of exchange drawn on a specified banker, and Order XXXVII Rule 1(2)(a) of the Code of Civil Procedure makes suits on bills of exchange eligible for the summary procedure, under which the defendant has ten days to enter appearance and must then obtain leave to defend. The second is a suit on the underlying debt, the loan or the invoice, which is also a summary suit if it rests on a written contract and an ordinary suit if it does not. Our note on summary suits explains how leave to defend is decided.
Limitation is the next thing to check. The Limitation Act, 1963 gives three years for most money claims, and Article 19 counts it from the date the loan was made where the debt is money lent. A dishonoured cheque does not restart that clock by itself, so if the loan is older than you think, take the date seriously. Keep the expired cheque and the return memo in any event. Section 146 of the Negotiable Instruments Act lets a court presume dishonour from the bank's memo, and in the civil suit the cheque is evidence that the debt was acknowledged.
What should I do this week?
- Find the date on the cheque and confirm with your branch whether it can still be presented
- Present it again through the account you maintain, so that jurisdiction stays with your branch under Section 142(2)
- Collect the fresh return memo in original and note the date you received it, because the thirty days run from receipt of the bank's information
- Send the demand notice by registered post with acknowledgement due, and keep the postal receipt, the tracking and the card
- If the cheque has expired, send a legal notice for the debt and file the suit before three years from the date the money became due
- Keep the first return memo too, since it proves the history of dishonour
What I tell clients in this position is that the missed notice is embarrassing but rarely fatal, and the real danger is the second mistake. People who have missed one deadline tend to over-correct by firing off a notice on the old memo, or by sitting on the cheque until it expires while they argue with the drawer on the phone. Present again, diary the new dates from the day the memo is in your hand, and if the cheque cannot be presented, accept that the case has become a civil recovery and start it before limitation adds a third problem. The rest of the criminal procedure, once the complaint is on file, is in our Section 138 procedure guide.