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Sunday, January 5, 2014

The Supreme Court of India ruled that Courts cannot impose a fine of more than twice the amount in bounced cheques.

A Bench of Justice T S Thakur and Justice Vikramajit Sen while ruling this the said direction explained that even in a case of where the court may be taking a lenient view in favour of the accused by not sending to prison, it cannot impose a fine more than the cheque amount. That statutory limit is inviolable and must be respected.

According to the Section 138 of the Negotiable Instruments Act, 1881

A person (whose cheque has bounced) shall without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extent to twice the amount of the cheque, or with both.
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