Various Liabilities Under Dishonour Of Cheques
- IJLLR Journal
- Apr 9, 2024
- 1 min read
Raghvendra Singh & Jahanvi Singh, National Law Institute University, Bhopal
Introduction
It is a very serious issue that the cheque issued by the drawer gets dishonoured. Such issues create doubt on integrity on cashless transactions. The legislature reflected the anxiety to this problem and has tried to provide an effective remedy by incorporating Chapter XVII in the Negotiable Instruments Act. This chapter makes this wrong an offence and provides punishment in case of commission of this offence. Incorporation of this chapter is an authentic example of an effort to grow a strong environment in business transactions. The concept of public welfare has been put into operation through the instrumentality of penal law in this Act. A person who issued the cheque and the bank returns the cheque without making payment on the cheque due to reasons mentioned in the Section, will be punished with the imprisonment and fine up to the limit mentioned in the Section.1 This Act makes provisions for the situations when the cheque issued by the company gets dishonoured.2 Everyone knows that a firm is a separate legal entity. Due to its manufactured nature, it lacks a physical body, a mind, and a soul. And hence, it cannot be brought before a court as part of a judicial process. Consequently, it needs a spokesman. Along with the firm, the individuals who take part in the company's actions could face liability.