No overkill in cheque bounce cases: SC
The Supreme Court of India has said that once the amount in a dishonored cheque is paid with
interest and compensation, the payee cannot insist on criminal prosecution of the directors of a firm
who issued the cheque. The object of Section 138 of the Negotiable Instrument Act, which makes
issuing of cheques without sufficient balance in the account an offence, is meant to “inculcate faith
in the efficacy of banking operations and credibility of transactions". It is not meant only to punish the guilty, as directed by the supreme court in Lafarge Aggregates & Concrete India Ltd vs Sukarsh Azad.
interest and compensation, the payee cannot insist on criminal prosecution of the directors of a firm
who issued the cheque. The object of Section 138 of the Negotiable Instrument Act, which makes
issuing of cheques without sufficient balance in the account an offence, is meant to “inculcate faith
in the efficacy of banking operations and credibility of transactions". It is not meant only to punish the guilty, as directed by the supreme court in Lafarge Aggregates & Concrete India Ltd vs Sukarsh Azad.
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