Bounced and Dishonored Cheques | Law and Remedy in Pakistan


Cheques are a common form of financial transaction in Pakistan, widely used for business and personal purposes. However, when a cheque is dishonored or bounced, it can lead to financial disputes and legal consequences. In Pakistan, laws exist to regulate such situations and provide remedies for those affected. In this blog, we will explore the legal aspects of bounced and dishonored cheques and the remedies available in Pakistan.

Understanding Dishonored Cheques

A dishonored cheque, commonly referred to as a bounced cheque, occurs when a bank refuses to honor a cheque presented for payment due to insufficient funds or other reasons. In Pakistan, this is a serious offense and can lead to both civil and criminal liabilities for the issuer of the cheque.

Legal Framework in Pakistan

1. The Negotiable Instruments Act, 1881: The primary legislation governing cheques and their dishonor in Pakistan is the Negotiable Instruments Act, 1881. This act provides the legal framework for the use of negotiable instruments, including cheques.

2. Section 138: Section 138 of the Negotiable Instruments Act is particularly relevant in cases of bounced cheques. It states that if a cheque is dishonored due to insufficient funds, the payee can give notice in writing to the drawer of the cheque, demanding payment within 15 days from the date of receipt of the notice.

3. Criminal Liability: Failure to make the payment within 15 days can lead to criminal charges against the drawer. The punishment may include imprisonment for a term that may extend to one year or with a fine that may extend to twice the amount of the cheque or with both.

4. Civil Suit: In addition to criminal proceedings, the payee can also file a civil suit to recover the amount of the bounced cheque, along with any applicable interest and legal expenses.

5. Protection of Rights of Holders in Due Course: The law in Pakistan provides protection to holders of cheques in due course. If a person receives a cheque in good faith and for consideration, without notice of any defect, they have the right to enforce the payment even if the cheque is subsequently dishonored.

Remedies for the Payee

If you are a payee who has received a bounced cheque, here are the steps you can take to seek remedies:

1. Serve a Legal Notice: Send a legal notice to the drawer of the cheque, demanding payment within 15 days as per Section 138 of the Negotiable Instruments Act.

2. Wait for Payment: Give the drawer the stipulated time to make the payment. If they do not comply, you can proceed with legal action.

3. File a Criminal Complaint: Lodge a criminal complaint against the drawer of the bounced cheque in the appropriate court, which may result in imprisonment and/or a fine.

4. File a Civil Suit: If you wish to recover the amount along with interest and legal expenses, file a civil suit against the drawer.

5. Seek Legal Counsel: It is advisable to consult a legal expert or lawyer who specializes in negotiable instruments law to guide you through the legal process.


Bounced and dishonored cheques can lead to legal complications in Pakistan. It is essential for both payees and drawers to understand their rights and responsibilities under the Negotiable Instruments Act, 1881. While the law provides remedies to the payees, it also imposes significant penalties on those who issue dishonored cheques. To avoid legal troubles, individuals and businesses should ensure that they maintain sufficient funds in their bank accounts to cover the cheques they issue, and payees should be aware of the legal procedures to seek redress in case of a bounced cheque. Legal counsel can be invaluable in navigating these complex matters and safeguarding one’s financial interests.

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