Understanding Cheque Bounce (Signature Mismatch) – A Guide by Legal Light Consulting

A bounced cheque can be a frustrating experience, especially when it involves a signature mismatch. If you’ve received a cheque that bounced because the drawer’s signature did not match the bank’s records, it’s important to know your rights and the legal steps you can take.

At Legal Light Consulting, we aim to simplify the process for you. This article explains what to do if a cheque bounces due to a signature mismatch and how you can protect your rights.

What is a Cheque Bounce Due to Signature Mismatch?

A cheque bounce due to signature mismatch occurs when the bank cannot process the cheque because the drawer’s signature on the cheque does not match the signature they have on record with the bank. In this case, the drawer (your friend) issued the cheque as repayment for a loan on behalf of the principal debtor

Evidence to Support Your Case

To prove that the cheque was issued for a valid transaction, you can use the following types of evidence:

1. Written Evidence
   • Promissory Note
   • Letters
2. Digital Evidence
   • Emails
   • WhatsApp messages
3. Oral Evidence
   • Witnesses

When filing a complaint, only include details of the specific transaction for which the cheque was issued. If the drawer denies the transaction, you can present the above evidence to support your claim.

Key Details of the Case

• Cheque Amount: Rs. 50,00,000/- (50 Lakhs)
• Return Memo Date: 17-01-2025 (the date the bank informed you the cheque bounced)

Legal Remedies Available

If a cheque bounces due to a signature mismatch, you have several legal options:

1. Criminal Proceedings

• Under the Negotiable Instruments Act, 1881
  • Section 138: This section deals with the dishonor of cheques, including cases of signature mismatch.
  • Steps to Take:
    • Serve a legal notice to the drawer within 30 days of receiving the return memo (by 16-02-2025).
    • If the cheque is still valid, you can re-present it to the bank within 90 days of the cheque date to restart the legal process.
  • Territorial Jurisdiction: UCO Bank, Supreme Court of India.
• Filing an FIR for Cheating (Under Bharatiya Nyaya Sanhita, 2023)
  • Section 318: Cheating
  • Time Limit: File before 17-01-2026 (1 year from the return memo date).
• Filing an FIR for Breach of Trust (Under Bharatiya Nyaya Sanhita, 2023)
  • Section 316: Criminal Breach of Trust
  • Time Limit: File before 17-01-2028 (3 years from the return memo date).

2. Mediation

• Mediation is a process where both parties try to resolve the dispute with the help of a neutral mediator.
• Under the Mediation Act, 2023:
  • Mediation is mandatory if a notice has been served.
  • If mediation fails, you can proceed with legal action.

3. Recovery Suit (Under Civil Procedure Code, 1908)

• You can file a civil suit to recover the cheque amount.
• Time Limit: File before 17-01-2028 (3 years from the return memo date).
• Court Fees: Rs. 51,144/-
• Jurisdiction: District Judge

Important Advice

• Under Sections 138 and 139 of the Negotiable Instruments Act, the drawer is presumed to be liable unless they challenge the claim.
• If the drawer challenges the liability, you must provide evidence to prove your case. This can include written, digital, or oral evidence.
• Many court cases have been decided in favor of the drawer when the drawee (you) failed to provide sufficient evidence.

Why Seek Professional Help?

Legal processes can be complex, and the outcome often depends on the quality of evidence and proper legal representation. At Legal Light Consulting, our team of experienced lawyers can guide you through every step, ensuring your case is handled smoothly and effectively.

Disclaimer

This article is for educational and informational purposes only. It does not constitute legal advice. For personalized guidance, consult the legal experts at Legal Light Consulting. We are here to help you navigate the legal system with confidence.