Bouncing or Dishonor of Cheque


A Cheque is a bill of exchange drawn upon a specified banker & not to be expressed to be payable otherwise than on demand. The following are the essential characteristics of a cheque:

  1. It has to be in writing
  2. It has to be an unconditional order
  3. Banker has to be specified
  4. Payment should be directed to a specified person
  5. It should be payable on demand
  6. It should be for a specific some of money
  7. Should have the signature of the drawer



A cheque is said to be dishonoured or bounced when it is presented for payment to a bank but it is not paid because of some reason or the other. Cheque bouncing is a criminal offence in India.


The following can be the reasons for bouncing of a cheque in India:

  1. Signature is not matching
  2. There is overwriting in the cheque
  3. Cheque was presented after lapse of six months, i.e. after the cheque has expired
  4. Account was closed
  5. Insufficient funds in the account
  6. Payment stopped by the account holder
  7. Opening balance insufficient
  8. Disparity in the words and figures mentioned on the cheque
  9. In case the cheque is issued by a company, the same does not bear the seal of the company
  10. Mismatch in account number
  11. In case of joint account where both signatures are required, only one sign is there
  12. Death of the customer
  13. Insolvency of the customer
  14. Insanity of the customer
  15. On the order of the garnishee
  16. Crossed cheque
  17. When a cheque is issued against the rules of trust
  18. Alteration in cheque
  19. Doubt in genuineness of the cheque
  20. Presented at the wrong branch
  21. Crossing limit of overdraft (OD)