Cheque bounce cases are among the most commonly misused legal provisions in India. Many individuals attempt to file false or exaggerated claims under Section 138 of the Negotiable Instruments Act, even when no legally enforceable liability exists.
In this case, our client was wrongly accused of issuing a cheque as repayment of a debt. The cheque had indeed been signed by the client, but it was issued as a security cheque, not towards any legally recoverable amount. When the complainant deposited the cheque without approval and it bounced, they immediately initiated criminal proceedings to pressurize our client into paying money that was not legally owed.
Understanding the gravity of a criminal complaint and the potential damage to reputation, our client approached us for immediate legal defence. Through strategic arguments, thorough evidence collection, and a strong understanding of NI Act principles, we successfully proved that the cheque was not issued towards a legally enforceable debt, leading to the case being dismissed.
This matter is a classic example of how a well-prepared legal defence can protect innocent individuals from wrongful prosecution in cheque bounce matters.
The case was complex and required strategic defence planning due to the following challenges:
The complainant had physical possession of a cheque bearing our client’s signature, making the prima facie case appear strong.
The cheque was originally handed over as a security instrument, but there was no written agreement proving this, creating legal ambiguity.
The complainant falsely claimed a large outstanding amount without any documented proof, hoping to misuse Section 138 to force payment.
NI Act cases have strict statutory timelines, requiring quick preparation, filing, and arguments.
A cheque bounce case, though quasi-criminal, can cause severe mental stress, reputational risk, and potential penalties for the accused.
To ensure success, we had to dismantle the complainant’s claim step by step using facts, documents, and well-settled legal principles.
Our legal team developed a solid defence strategy focusing on proving the absence of legally enforceable liability.
We collected materials showing the business relationship context, including:
WhatsApp chats
Email exchanges
Transaction history
Communication proving cheque was taken as security
These collectively supported our client’s version.
We argued that:
No loan agreement was ever executed
No ledger entries or receipts were produced by the complainant
No bank transfer or proof of money exchange existed
This directly attacked the essential requirement under Section 138: existence of a legally enforceable debt.
During cross-examination, we exposed multiple contradictions:
Complainant could not specify date or mode of alleged loan
Claimed amount varied in different statements
No documentary proof of financial capacity to lend such money
Admission that cheque was taken earlier for future security
This significantly weakened the prosecution's case.
We cited several judgments from the Supreme Court and High Courts, establishing that:
Security cheques do not constitute liability unless proven otherwise
Burden of proof shifts back to complainant once defence raises probable cause
Absence of documentary proof invalidates loan claims
We submitted well-structured written arguments summarizing evidence, contradictions, and legal principles in favour of our client.
The final outcome was highly favourable:
The Court dismissed the cheque bounce complaint in its entirety
It held that no legally enforceable debt existed
The cheque was proven to be a security cheque, misused by the complainant
Our client was fully acquitted, with no criminal liability
False allegations were exposed, restoring the client’s reputation
Our client avoided a potential conviction, penalty, and unnecessary financial burden
This case reinforces that a cheque alone is not proof of debt, and a strong, evidence-backed defence can successfully counter false or malicious Section 138 cases.
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