Traders move to Nirmala Sitharaman over 40 lakh pending cases on bounced cheques

NEW DELHI: A traders’ association has urged the government to set up fast track courts to deal with the rising menace of dishonoured cheques hampering the credibility of the crucial payment instrument in trade ecosystem.

In a letter addressed to Finance Minister Nirmala Sitharaman, the Confederation of all India Traders (CAIT), has suggested the formation of fast track courts at district level to deal with the cases of bounced cheques on immediate basis and bring amendments in Section 138 of The Negotiable Instrument Act, 1881.

ET has seen a copy of the letter, dated February 6, 2020.


“The entire trading community in the country is deeply perturbed over cheque dishonouring and much long period to obtain justice from the Courts,” Praveen Khandelwal CAIT National Secretary said in the letter.

According to the 213th Law Commission Report, there are about 40 lakh cheque bounce cases. The letter also quoted a Supreme Court Bench headed by Justice Adarsh Kumar Goel, who observed on 20th June 2018, that more than 20 per cent of the cases in subordinate courts dealt with bounced cheques—which is a criminal offence involving penal as well as pecuniary punishment—and thus norms had to be laid down to expedite decisions & encourage compounding of offences under Section 138 of the Act.

“The inability of the courts to adjudicate these cases in a timely manner is a serious infringement of the fundamental rights of litigants. This mistrust of cheques encouraged a move towards cash transactions which brought a host of their own problems, such as counterfeit notes, corruption, and large amounts of untraceable and untaxable money,” Khandelwal said.