Dishonour of a cheque is a criminal offence. Explain the relevant sections/provisions of Negotiable Instrument Act, 1881.

Under section 138 of the Negotiable Instrument Act, 1881, dishonour of a cheque is a criminal offence liable to be punished with 2 year's imprisonment or with the fine up to twice the amount of the cheque or both. The following are required to be satisfied to make the dishonour an offence under the provisions of the NI Act, 1881: Existence of a legally enforceable debt or other liability by the drawer of the cheque towards another person (will be payee or holder of the cheque, as the case may be) and a cheque is drawn to discharge the debt or liability. Cheque is returned due to insufficient funds or exceeds the amount agreed upon to be paid by the bank. Cheque should be presented within its validity (i.e. 3 months from the date of issue). Notice in writing is sent within 30 days to the drawer along with the receipt of information form bank about failure of payment of cheque. The payee or holder does not receive the payment within 15 days of the receipt of the notice to the drawer. The complaint to be made within one month from the cause of action arising. Only payee or holder can lodge a complaint. The offence will be tried in Metropolitan magistrate court or judicial Magistrate of 1st class court. Cheques issued towards payment of debt will only attract the provisions of Section 138 of the NI Act, 1881. Cheque given for donation or post dated cheques for security purposes or undated cheques will not be covered under this section.