What are the remedies in case of Payment of a cheque stopped
by drawer? How to file file Complaint in case of stop payment of
cheque? Options u/s Section 138 of Negotiable Instruments Act
It is common practice of some people who intentionally cheat
the debtor by issuing cheque and giving instruction to the bank
to stop payment against the cheque.
Payment of the cheque may be stopped due to many reasons like
misplace of cheque, issue of alternate cheque, discharge of
liability by paying in other modes etc. One of the most
important point is sometimes the drawer of a cheque may stop
payment due to supply of inferior goods or poor service which
violates the agreements or terms agreed by the other party. In
such cases aggrieved party is the customer, Even though the
other party have the option to pressurize the drawer of the
cheque to make payment.
But in many cases stop payment is being used to escape from
liability of payment and to avoid proceedings under section 138
of Negotiable Instruments Act 1881.
Treatment for in case of stop payment of cheque is not
clearly defined in the Negotiable Instruments Act. But to file a
case under Negotiable Instruments Act, the following conditions
should be satisfied.
The cheque is drawn on a bank for the discharge of a
legally enforceable debt or other liability.
The cheque has returned by the bank unpaid.
The cheque is returned unpaid because the amount
available in that account is insufficient for making the
payment of the cheques.
The payee gives a notice to the drawer claiming the
amount within 15 days of the receipt of the information by
the Bank and
The drawer fails to make payment within 15 days of the
receipt of notice.
Form the above mentioned conditions point No. 3 clearly
indicates that if the amount is available in the bank account
and stop payment is made due to some other reasons, the case may
not be registered under section 138 of the Negotiable
But point No. 5 remain constant and if the drawer fails to
make payment within 15 days of receipt of notice the case will
come under section 138 of Negotiable instruments Act 1881.
According to a Supreme Court version even if the cheque is
bounced because of stop payment, if the bank account is having
sufficient balance to meet the cheque amount, and if the person
who gives stop payment is having valid and sufficient reasons
for giving such instructions, the accused can be acquitted. This
means that the drawer have to establish during trial that there
is no legally enforceable liability for the cheque taken by them
and because of that reason only you have stopped the cheque from
In nutshell whatever may be the reason or ground for dishonor
of a cheque by bank whether it may be payment stopped by drawer
or any other reason, offence under this section is made out and
the drawee has the full right to initiate proceedings. The court
may also examine whether the payment has been made by the drawer
within 15 days of notice issued by the drawee after dishonor of