Apply to insolvency court for being declared an insolvent
your assets if any will vest in the official assignee
Can I file for personal bankruptcy in cheque bounce case and get protection
I was running a flourishing business in a sole propritorship. Due to some unforseen circumstances, the business went into losses and account turned NPA. Banks have taken over all my collateral including my house. am currently living on rented premises with my ailing parents and looking for a job. i have no other assets to either my name or to my parents name. One of my vendors has filed a chq bouncing case against me under sec 138. Is there any way I can file for some legal relief as I truly do not have any assets left.
Asked 11 months ago in Criminal Law
Religion: Hindu
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6 Answers
Apply for insolvency.
Having no money or asset is no defence in 138 NI Act case.
Whether you file an insolvency case or not, you have to face the cheque bounce case as per law.
You cannot claim exemption from the charges of this cheque bounce case just because you have filed the insolvency case.
That is different to that of the cheque bounce case.
Yes you can file but you can’t avoid jail sentence in 138 by filing bankruptcy
Dear Client,
A dishonoured check's drawer must get a formal notification, according to Section 138 of the Negotiable Instruments Act of 1881. If the recipient of a cheque has not received the payment because of inadequate funds or for any other reason, this provision offers them a legal remedy. A dishonoured check's payee is required by Section 138 to notify the drawer in writing of the dishonoured check within 30 days of receiving it. The notification needs to be delivered either speed post or registered mail, and it needs to be acknowledged. The recipient has the right to sue the issuer for failing to pay the bill if the issuer declines to pay or if the bounced bill was done on purpose. A settlement can be negotiated and a payment schedule can be agreed upon by the parties to resolve the dispute. The payee may bring a criminal complaint against the drawer in accordance with Section 138 of the Negotiable Instruments Act if the drawer does not make the payment within 15 days of receiving the notice. After the 15-day period has passed, the complaint must be submitted within 30 days. If a cheque drawer is found guilty under Section 138, he has the right to appeal the decision. The Appellate Court may, in such a situation, direct him to deposit a sum equal to at least 20% of the damages or fine that the trial court assessed, in accordance with Section 148. Issuing a cheque against an account that isn't fully funded could result in legal action for the payer. The payee has three months to decide whether to sue the payer or permit the payer to rewrite the cheque. If a cheque is returned unpaid, the payer faces a maximum two-year jail sentence.
Hope this answer proves beneficial to you.
