Cheque Dishonour in Bangladesh: Clear 2026 Guide

A returned cheque can create an urgent commercial problem, but it does not produce the same legal result in every case. In Bangladesh, the principal statutory offence is in section 138 of the Negotiable Instruments Act, 1881. It applies where a cheque is returned unpaid because the funds in the relevant account are insufficient or because the cheque exceeds an amount arranged with the bank. The holder must also meet a tightly sequenced presentment, notice and complaint timetable. [1] [2]

This guide explains that framework as at 18 October 2026. It also reflects the 2026 amendment to the court-allocation rule for section 138 cases. It is general information rather than legal advice. The return reason, the cheque terms, proof of service, the parties’ status and the applicable court rules should be checked against the original documents before a deadline is allowed to pass.

Contents

At a glance: the statutory sequence

The most important discipline in a cheque dishonour matter is to treat it as a sequence, not simply a demand for an unpaid debt. Under section 138, the relevant chain is: timely presentation of the cheque; information from the bank that it was returned unpaid for a statutory reason; a written demand notice within the statutory period; non-payment within the drawer’s statutory opportunity to pay; and a written complaint by the correct claimant within the limitation period. A missed step can materially affect a proposed section 138 complaint. [2] [3]

A concise working timeline is as follows:

1. Present the cheque to the bank within six months from its drawing date or within its validity period, whichever is earlier.
2. If it is returned unpaid, preserve the bank’s return information and identify the stated reason.
3. The payee or holder in due course must give the drawer a written notice demanding the cheque amount within 30 days of receiving information from the bank about the unpaid return.
4. The drawer has 30 days from receipt of that notice to make payment.
5. If payment is not made during that period, the payee or holder in due course must make the written complaint within one month from the date the cause of action arises under the payment-failure limb of section 138. [2] [3]

Those are statutory thresholds, not a recommended commercial timetable. A prudent holder will act well before the outer dates. In particular, do not substitute the date of drawing, bank presentation, bank return, notice dispatch or notice receipt for another date without checking which event the Act specifies. The statutory scheme uses different trigger dates for different steps. [2]

The 2026 change is also important. Since 10 April 2026, section 141(c) directs that an offence under section 138 involving a cheque with a face value exceeding Tk. 5 lakh is not to be tried by a court inferior to a Metropolitan Joint Sessions Judge or Joint Sessions Judge, as applicable. Other section 138 offences are triable by a Metropolitan Magistrate or a Magistrate of the first class. [3] [4]

What counts as a cheque and what section 138 covers

The Act defines a cheque as a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand. This is a statutory definition. A document described informally as a “cheque”, a copy, an image or a payment promise should not automatically be assumed to meet it. [1]

Section 138 is narrower than the everyday phrase “cheque bounce” can suggest. Its operative wording addresses a cheque drawn by a person on an account maintained by that person with a banker for payment of money to another person, where the bank returns it unpaid because the credit in the account is insufficient to honour it or it exceeds the amount arranged to be paid under an agreement with the bank. The section provides a criminal offence only subject to its stated conditions. [2]

That distinction matters when reading a bank return memo. A bank may return an instrument for many operational or documentary reasons. A signature discrepancy, a stale or otherwise irregular instrument, an account issue, a stop-payment instruction, an apparent alteration or another stated reason should not be casually relabelled as a section 138 funds case. The statutory wording should be compared with the actual reason given by the bank and the evidence available. A return itself is not a substitute for that analysis. [2]

The current text also deserves careful reading in its own right. Section 138 speaks of a cheque drawn on an account maintained by the drawer for payment to another person; the phrase concerning discharge of a debt or other liability was removed from the provision by the 2000 amendment, as the official legislative notes record. That does not resolve every dispute about the underlying commercial relationship. It does mean that parties should avoid importing wording from outdated summaries or from another jurisdiction in place of the Bangladesh text. [2]

Timely banking action remains important beyond the special section 138 timetable. Section 84 states that where a cheque is not presented within a reasonable time and the drawer, who then had the right as against the banker to have it paid, suffers actual damage through the delay, the drawer is discharged to the extent of that damage. What is reasonable depends on the instrument, banking and trade usage, and the facts. That provision is distinct from the six-month-or-validity-period requirement in section 138, but it reinforces the practical need for a holder not to hold a cheque without a reasoned plan. [2] [10]

The statutory clock: presentment, notice and complaint

Present the original instrument within the earlier deadline

Section 138 requires presentation to the bank within six months from the date on which the cheque was drawn or within its period of validity, whichever is earlier. “Six months” is therefore not a safe standalone rule. If the instrument’s validity period ends sooner, the earlier validity period governs for the section 138 condition. Record the drawing date, the presentation date and any date shown by the bank’s system or return document. [2]

The analysis should not start with an assumption that repeated presentation extends deadlines. Each return, any re-presentation, and the information received from the bank must be assessed on its documents and dates. A holder considering further banking action should first ensure that doing so will not distract from, or compromise, the statutory path being considered.

Separate the three 30-day periods and the one-month complaint limit

The next period runs from receipt of information from the bank that the cheque was returned unpaid. The payee or holder in due course has 30 days from that receipt to give a written notice demanding payment. The Act then gives the drawer 30 days from receipt of the notice to pay. [2]

Only after the drawer fails to pay within that notice-receipt period does the cause of action described in section 138 arise. Section 141 then requires the written complaint to be made within one month from that date. It is inaccurate to say that a complaint may simply be filed “within 30 days of dishonour” or “within 30 days of sending the notice.” The statute distinguishes these events. [2] [3]

In practice, a timeline should identify the person who received the bank information, the method and date of notice service, the evidence supporting receipt, and the proposed complaint date. Parties should preserve envelopes, delivery records and other primary material rather than rely only on a later recollection. Where delivery dates are disputed, the difference between dispatch and receipt can be decisive to the statutory sequence.

Do not assume a court will repair a late or incomplete sequence

The statutory conditions should be treated as matters to establish, not as formality that can be left to the end of a dispute. A Magistrate taking cognizance on a complaint examines the complainant and such witnesses present as the Magistrate considers necessary on oath, subject to stated exceptions. The Magistrate may postpone process to inquire into or investigate the truth or falsehood of a complaint, and may dismiss a complaint where there is no sufficient ground for proceeding, recording reasons. [7] [8] [9]

These Criminal Procedure Code provisions do not turn every complaint into the same process or outcome. They illustrate why the person filing should have a coherent, document-supported chronology from the outset. They are also a reason not to promise clients that a notice, a filing or an allegation will automatically result in process, conviction or payment.

Notice: service methods and defensible records

The section 138 notice is a statutory demand, not merely a routine lawyer’s letter. It must be in writing, it must demand payment of the amount concerned, and it must be given by the payee or holder in due course within the 30-day period measured from receipt of the bank’s unpaid-return information. [2]

Section 138(1A) specifies three ways in which this notice is to be served: delivery to the person to be served; registered post with acknowledgement due to that person at the usual or last known place of abode or business in Bangladesh; or publication in a daily Bangla national newspaper having wide circulation. The method used should be chosen and carried out with the facts of the matter in mind, rather than added later as an afterthought. [2]

A carefully prepared notice package will normally make it straightforward to see what is being claimed and why. Although the Act does not prescribe a model form in section 138, good record discipline ordinarily includes identifying the cheque sufficiently to distinguish it, stating the amount demanded, recording the bank-return context, preserving the return document, and retaining the signed notice and each service record. The legal sufficiency of any particular notice should be reviewed on its facts.

For service by registered post, preserve the postal receipt, acknowledgement material and the exact address used. For personal delivery, retain evidence capable of identifying what was delivered, to whom, when and by whom. For publication, retain the full relevant newspaper page or certified publication record—not just an online screenshot. These are practical proof measures, not a replacement for the statutory service requirements. [2]

A business should also keep internal evidence of its own date of receipt of the bank’s return information. That date starts the notice period for the payee or holder in due course. A matter can become more difficult if a team treats the date the bank processed the return, the date a relationship manager called, or the date a finance employee forwarded an email as automatically interchangeable without preserving the underlying material.

Making a complaint and the 2026 court allocation

Section 141 sets clear gatekeeping rules for a section 138 offence. No court may take cognizance except on a written complaint made by the payee or holder in due course of the cheque. The complaint must be made within one month of the cause of action arising under the section 138 payment-failure condition. [3]

The statute’s claimant wording is important. A commercial participant with an interest in the transaction is not automatically the same as the statutory payee or holder in due course. Where a business, assignee, representative, partnership, corporate payee or multiple signatories are involved, the identity and authority of the proposed complainant need careful legal review before filing.

The current court allocation should be stated precisely. The 2026 Act, which came into force immediately on 10 April 2026, substituted section 141(c). For a section 138 cheque whose face value exceeds Tk. 5 lakh, no court inferior to the court of Metropolitan Joint Sessions Judge or Joint Sessions Judge, as applicable, may try the offence. Every other section 138 offence is triable by a Metropolitan Magistrate or a Magistrate of the first class. A cheque for exactly Tk. 5 lakh falls within “every other” case under the literal distinction between “exceeds” and the balance of the provision, but court practice and the full facts should be confirmed before filing. [3] [4]

This allocation provision should not be overstated. It identifies the level of court that may try the case; it is not a complete answer to every question about where a complaint should be lodged, how territorial jurisdiction is established, what papers a registry will require, or how a particular court will administer a case. Those matters should be checked against current rules, filing practice and legal advice at the relevant time.

At the complaint stage, section 200 of the Code of Criminal Procedure provides for examination on oath, with the recorded substance signed as specified. Section 202 allows postponement of process and an inquiry or investigation in the circumstances stated; section 203 allows dismissal if there is no sufficient ground for proceeding after consideration of the complaint material. The safest approach is therefore a complete filing package, not a bare allegation supported only by an assertion that a cheque was returned. [7] [8] [9]

Evidence and document preservation

A section 138 file should be built around originals, dates and a clear chain of documents. The following working checklist is not an official filing list and should be tailored to the case, but it is a sensible starting point:

• the original cheque and clear copies of both sides, kept securely;
• the bank return memo, slip, certificate or other bank information showing that the cheque was returned unpaid and the stated reason;
• evidence of the date on which the payee or holder received that return information;
• the written demand notice and proof of the service method used, including postal acknowledgement, delivery material or the full newspaper publication where applicable;
• the transaction documents and communications that provide commercial context for the cheque and identify the relevant parties;
• documents establishing the payee’s or holder’s status and, where applicable, the authority of the person acting for that entity; and
• an event chronology showing each statutory deadline and the evidence supporting it.

Do not alter the original cheque or annotate a bank document in a way that could create later questions about its condition. If originals must be lodged, obtain and retain appropriate copies and receipt records. Communications with the drawer should be retained in their original form and metadata should be preserved where available. The goal is not volume for its own sake; it is a reliable account of the statutory sequence.

The reason shown by the bank is especially important. It is unwise to tell a court or counterparty that the return was due to insufficient funds if the bank document uses different language. If the return reason is unclear, obtain the bank’s clarification promptly and take advice on whether section 138 is the right route. The statute does not make every unsuccessful cheque presentation an insufficiency-of-funds offence. [2]

Corporate cheques and responsible persons

When a company issues the cheque, the legal analysis is not limited to the company name printed on the instrument. Section 140 provides that, if the person committing a section 138 offence is a company, every person who was, at the time of the offence, both in charge of and responsible to the company for the conduct of its business, as well as the company, is deemed guilty and may be proceeded against and punished. [5]

This is not a blanket rule that every director, employee, investor or signatory is automatically liable. The provision contains a defence for a person who proves that the offence was committed without that person’s knowledge or that the person exercised all due diligence to prevent it. It also provides for liability of a director, manager, secretary or other officer where the offence is proved to have occurred with that person’s consent or connivance, or is attributable to that person’s neglect. [5]

For this purpose, “company” includes a body corporate, firm or other association of individuals. In relation to a firm, “director” means a partner. Corporate recordkeeping can therefore be material: board or partner decisions, delegated authorities, account mandates, finance controls, communications about liquidity and cheque-approval records may all be relevant to a fact-specific assessment. [5]

Businesses should avoid indiscriminate naming of individuals. A complaint or defence should be based on the statutory tests and the contemporaneous role evidence, not merely job titles. Conversely, a company’s internal allocation of tasks should not be assumed to displace the statutory language. A focused review of responsibility at the relevant time is more useful than general allegations.

Penalty, recovery and bank-service complaints

If the conditions of section 138 are established, the offence is punishable with imprisonment for up to one year, a fine up to three times the amount of the cheque, or both. The maximum fine is not an automatic award, and the statutory wording should not be presented as a promise of a particular sentence or financial result. [2]

The Act deals expressly with the holder’s position where a fine is realised. It says that an amount up to the face value of the cheque, insofar as covered by the fine realised, is to be paid to the holder. It then preserves the holder’s right to establish a claim in a civil court if all or part of the cheque value remains unrealised. In other words, a section 138 proceeding is not a guarantee that the holder will receive the full cheque amount. The actual recovery position will depend on the facts, the orders made and sums realised. [2]

Section 138A adds a specific appellate restriction. No appeal against an order of sentence under section 138 lies unless at least 50% of the dishonoured cheque amount is deposited before filing the appeal in the court that awarded the sentence. This is a statutory precondition relevant after a sentence; it is not a general pre-filing deposit required from a complainant commencing a section 138 case. [6]

There is a separate practical route where the concern is about a bank’s customer service or conduct rather than the drawer’s liability. Bangladesh Bank’s Customer Interest Protection Centre advises customers to raise the issue with the branch first, then the institution’s complaint cell, and then the CIPC if the issue remains unresolved or the customer is dissatisfied. The CIPC states that it does not deal with, among other matters, complaints that are sub judice. This regulatory customer-complaint route should not be confused with a section 138 complaint or a civil claim between private parties. [11]

A controlled response plan for businesses

A recipient business should act calmly and quickly when a cheque is returned. First, secure the original instrument and the bank’s return material. Record the date and means by which the business received the return information. Check the cheque’s drawing date, validity period, payee name, amount, account details and the precise return reason. Do not recast a vague or non-statutory return reason as “insufficient funds” without evidence. [1] [2]

Second, create a short deadline chart. Separate the presentation deadline, the final date for giving notice, the date and proof of notice receipt, the end of the drawer’s 30-day payment period and the last day for the statutory complaint. Assign a responsible person to retain originals and obtain copies from banking channels. The management decision about settlement, further banking action or litigation should be informed by that chart, not allowed to postpone it.

Third, identify the correct legal actors. Is the business the named payee or a holder in due course? If the cheque came from a company or firm, which entity drew it, who signed it, and who was responsible for business conduct at the relevant time? Do the available records support the status and facts required for a defensible position? [3] [5]

Fourth, keep the legal and commercial tracks distinct but coordinated. An agreed payment plan, if considered, should be documented carefully and reviewed for its effect on statutory rights and deadlines. A call, an apology or a promise of payment is not evidence of statutory notice service. Nor should negotiations become a reason to let a deadline expire without informed advice.

Finally, use a measured external communication. If the matter needs advice, TRW’s confirmed contact page provides a route to begin an enquiry, and the confirmed practice directory can help identify a relevant field of work. Initial enquiries should not include confidential, privileged or time-sensitive information unless an appropriate professional engagement and secure channel have been established. This article is general information only and does not create a lawyer-client relationship.

Frequently Asked Questions