Prevent
Cheque Dishonour.
A dishonoured cheque under Section 138 can lead to ₹2,000+ crore fines & 2 years in jail. Don't let cheque bounce ruin your future.
Cheque Dishonour Crisis in India
Rise in Cheque Bounce Cases Since 2020
Total Fines Imposed in 2024-25
Cases Filed Under Section 138 Monthly
Success Rate with ChequeShield
Cheque Dishonour Process — What Happens After a Bounced Cheque?
BANK REJECTS CHEQUE
Your cheque is returned unpaid. Bank issues a dishonour memo citing insufficient funds or other discrepancies.
SECTION 138 LEGAL NOTICE
Payee sends a formal legal notice demanding payment within 15 days. Failure to comply triggers criminal proceedings.
CRIMINAL CASE & JAIL
Police complaint filed. Punishment: up to 2 years imprisonment, fine up to twice the cheque amount, or both.
What is Cheque Dishonour?
Cheque dishonour, commonly known as cheque bounce, occurs when a bank refuses to honour a cheque presented for payment. Under Section 138 of the Negotiable Instruments Act, 1881, issuing a dishonoured cheque is a criminal offence in India that can result in severe penalties including imprisonment.
When you write a cheque to someone and that person deposits it in their bank, the bank may reject the payment for various reasons — most commonly insufficient funds, but also due to signature mismatches, overwriting, wrong dates, or improper formatting. When this happens, the cheque is said to be "dishonoured" or "bounced."
warning_amber Why This Matters
Unlike a simple payment failure, a dishonoured cheque triggers criminal proceedings under Section 138. The payee can file a legal notice, and if payment isn't made within 15 days, a criminal case follows — potentially leading to 2 years in jail and fines up to twice the cheque amount.
Why Cheques Get Dishonoured — Common Reasons
Understanding why cheques bounce is the first step to preventing dishonour. Here are the most common reasons banks refuse to honour cheques:
Insufficient Funds
The most common reason for cheque dishonour. Your account doesn't have enough balance to cover the cheque amount.
Post-Dated or Wrong Date
Cheques with future dates (post-dated), outdated dates, or incorrect date formats are rejected by banks.
Signature Mismatch
If your signature on the cheque doesn't match the bank's records, the cheque will be dishonoured immediately.
Overwriting or Alterations
Any corrections, overwriting, or alterations to the cheque amount, date, or payee name leads to dishonour.
Amount Mismatch
When the amount in words doesn't match the amount in figures, banks will refuse to honour the cheque.
Poor Print Quality
Handwritten or poorly printed cheques with misaligned text, smudged ink, or unclear amounts get dishonoured.
Handwritten vs ChequeShield Printed Cheques
See the difference that professional printing makes
close Handwritten Cheque
High Risk of Dishonour
Illegible Handwriting
Banks reject cheques with unclear or unreadable handwriting
Overwriting & Corrections
Any alteration or correction invalidates the cheque
Mismatched Amounts
Words and figures don't match leads to dishonour
Wrong Date Format
Incorrect or future dates cause rejection
Signature Issues
Mismatched or missing signatures
check_circle ChequeShield Printed
Zero Error Guarantee
Perfect Typography
Professional, clear, bank-compliant formatting
No Overwriting
Digital printing eliminates all corrections
Auto Amount Conversion
Words and figures always match perfectly
Valid Date Format
Always uses bank-accepted date formats
138 Compliant
Meets all NI Act Section 138 requirements
ChequeShield users have printed over 2.4 million error-free cheques across all Indian banks.
Legal Consequences of Cheque Dishonour under Section 138 NI Act
The Negotiable Instruments Act, 1881 treats cheque dishonour as a serious criminal offence. Section 138 specifically addresses the penalties for bounced cheques in India.
Imprisonment
Up to 2 years of imprisonment for the drawer of the dishonoured cheque.
Monetary Fine
Fine of up to twice the cheque amount, in addition to any civil liability.
Criminal Record
A conviction under Section 138 results in a permanent criminal record affecting future employment and travel.
Credit Score Impact
Dishonoured cheques severely damage your CIBIL score, making it harder to get loans or credit cards.
gavel Section 138 Legal Process Timeline
Day 0: Cheque Dishonoured
Bank returns cheque with dishonour memo.
Within 30 Days: Legal Notice
Payee sends demand notice via registered post.
15 Days: Payment Window
Drawer must pay the full amount within 15 days.
30 Days: File Complaint
If unpaid, payee files criminal complaint in Magistrate court.
Court Proceedings
Summons, evidence, hearing — potential conviction under Section 138.
Prevention is Better Than Punishment
Use ChequeShield to print error-free cheques and avoid this entire process.
5 Steps to Prevent Cheque Dishonour
Follow these essential steps to ensure your cheques never bounce
Check Balance
Always verify sufficient funds before issuing a cheque
Correct Date
Use proper DD/MM/YYYY format, never post-date
Match Amount
Ensure words and figures are identical
No Overwriting
Never alter or correct the cheque once written
Use ChequeShield
Print professional, error-free cheques every time
Even Celebrities Are Not Spared
Even Bollywood celebrities have faced jail time in cheque bounce cases under Section 138 NI Act.
Tihar Jail 2026
Rajpal Yadav
Actor — Phir Hera Pheri, Bhool Bhulaiyaa
Faced legal proceedings in a cheque bounce case related to an alleged dishonoured cheque. The matter drew public attention and highlighted that cheque dishonour disputes can involve individuals from the entertainment industry.
2 Years Sentence
Rajkumar Santoshi
Director — Andaz Apna Apna, Ghatak
Was involved in legal proceedings concerning an alleged cheque bounce dispute arising from a financial transaction. The case underscored the legal implications of dishonoured cheques under the Negotiable Instruments Act.
More Convictions
Others Convicted
Ameesha Patel, Koena Mitra, Bandla Ganesh & more
Actors like Koena Mitra , Telugu actor Bandla Ganesh , Boolywood Actore Ameesha Patel and TV Actor Alka kaushal have also been convicted and served jail terms.
- Alka Kaushal – Bollywood actress convicted in a cheque bounce case after failing to honour a ₹50 lakh cheque. She was sentenced to imprisonment before obtaining relief through legal proceedings.
- Bandla Ganesh – Telugu producer and actor convicted under the Negotiable Instruments Act in a cheque dishonour case arising from a financial dispute.
- Koena Mitra – Actress convicted in a cheque bounce case related to a financial transaction, reinforcing that celebrities are equally subject to cheque bounce laws.
- Ameesha Patel – Faced legal proceedings in a cheque bounce case involving financial commitments, highlighting the serious consequences of dishonoured cheques.
A single bounced cheque can lead to criminal conviction and jail — even for the rich and famous. Protect yourself with ChequeShield.
Introducing ChequeShield
India's Fastest, Easiest, Web-Based Cheque Printing Tool.
Used by CAs, NBFCs & SMBs to stay 138-compliant. No downloads. Works offline too.
Date:
24/01/2026
Authorized Signatory
Entry Mode
Fill in your cheque details below and preview in real-time
edit_note Cheque Details
visibility Live Preview
Date:
24/01/2026
Authorized Signatory
✠ 000000000000 ✠ 0000-0000-0000 ✠
Design Mode
Customize layout, fonts, positions and upload your logo
description Cheque Data
text_fields Font & Layout
palette Bank & Appearance
open_with Position Adjust
add_photo_alternate Upload Logo
Click to upload or drag & drop
PNG, JPG up to 2MB
preview Design Preview
Date:
24/01/2026
Authorized Signatory
✠ 000000000000 ✠ 0000-0000-0000 ✠
Frequently Asked Questions About Cheque Dishonour
Everything you need to know about cheque dishonour, cheque bounce, Section 138, and ChequeShield
What is cheque dishonour?
Cheque dishonour (or cheque bounce) occurs when a bank refuses to honour a cheque due to insufficient funds, signature mismatch, overwriting, or other discrepancies. It's a criminal offence under Section 138 of the NI Act, 1881.
What is the punishment for cheque bounce under Section 138?
Imprisonment up to 2 years, a fine up to twice the cheque amount, or both. The offence is bailable and compoundable.
What are the main reasons for cheque dishonour?
Insufficient funds, signature mismatch, post-dated cheques, overwriting, mismatch between amount in words/figures, stale cheques (3+ months old), and poor print quality.
How does a Section 138 legal notice work?
After dishonour, the payee sends a demand notice within 30 days. The drawer has 15 days to pay. If unpaid, the payee can file a criminal complaint within the next 30 days.
How can I prevent cheque dishonour?
Maintain sufficient balance, use correct date formats, avoid overwriting, ensure amounts match in words/figures, and use ChequeShield for error-free printing.
Is ChequeShield free?
Yes, basic printing is completely free. Premium features like bulk printing and custom templates are available in paid plans.
Does ChequeShield work offline?
Yes, once loaded, you can fill and print cheques without an internet connection.
Which banks does ChequeShield support?
All major Indian banks including HDFC, SBI, ICICI, AXIS, PNB, Kotak, BOB, and more. You can customize the bank name in Design Mode.
Is my data safe with ChequeShield?
Yes. All data stays in your browser. We never store or transmit your cheque details to any server.