Is cheque bounce a criminal offence

Yes, a cheque bounce is a criminal offence in India under Section 138 of the Negotiable Instruments Act, 1881, specifically when it occurs due to insufficient funds or if the amount exceeds the arrangement with the bank. If a cheque is dishonoured, the issuer can face serious legal consequences, including:

• Imprisonment for a term of up to two years.
• A fine that may extend to twice the amount of the cheque.
• Both imprisonment and a fine.

Additionally, it can negatively impact your credit score and future loan eligibility.