A common complaint by our clients is that a business party or friend has given them a cheque which has been ‘Dishonoured’. Hence this guide about Dishonouring of Cheques is hoped to be able to help our prospective clients understand the complexities and legal implications of their situations , involved in the matter.
Frequently Asked Questions (FAQs) on the dishonour of cheques in Pakistan.If you are looking for information on stale cheques please click here.
What are the conditions that make the dishonouring of a cheque an offence in Pakistan?
When cheque is issued dishonestly by one person to the other.
In what circumstances is the dishonouring of a cheque not an offence in Pakistan?
Each case has its own facts and the dishonouring of a cheque is not an offence when the signatory has made arrangements with his bank to ensure that the cheque will be honoured and it was the bank at fault in not honouring the cheque.Please contact our team based on your special facts for proper legal assistance.
What is the penalty for dishonouring a cheque in Pakistan?
The issuance of any cheque dishonestly is an offence under the statute and both civil and criminal remedies could be availed simultaneously in such matters. The punishment on the bouncing of cheque is imprisonment which may extend to three years and also a fine.
What can I do when a cheque is dishonoured for the reason of insufficient funds? What legal action can I take to get the amount cleared?
You can lodge a First Information Report against the signatory and at the same time also file a civil suit. There is no legal bar if criminal and civil proceedings continue simultaneously. Our advice is that before lodging F.I.R. notice of the dishonouring of the cheque should also be given.
My cheque was dishonoured that was issued by a company, is there any remedy to recover my amount? I presume I cannot lodge F.I.R. against a company.
Each case has its own facts and you can lodge the First Information Report against the signatory who issued the cheque and at the same time also file a civil suit. There is no legal bar if criminal and civil proceedings continue simultaneously.
We are in the business of selling Macbook Computers. During the course of our business we supplied Macbooks worth Rs 1 million, but our client dishonoured the cheque. We lodged the First Information Report (FIR) under section 489-F Pakistan Penal Code and after that he paid us half the amount and then disappeared. We have no idea of his current whereabouts. The court has issued a proclaimed offender notice and he is untraceable. Is there anything else we can do?
Once he has been declared as a proclaimed offender you should ask the court to proceed in the matter and get all your evidence recorded, this will help you when he is eventually arrested and if at that time for some reason or the other witnesses are not available the court can proceed with the matter on the basis of the evidence earlier recorded in his absence. Simultaneously, at his last known address you can file a suit for recovery in the civil court.
I have a cheque dishonoured, where do I lodge an F.I.R.? The bank where the cheque was dishonoured or the place where the cheque was issued?
Each case had to be viewed on its own facts and you can lodge FIR either where the cheque was dishonoured or the place where the accused carries out his business.
A partnership firm gave a cheque to me and when I presented it it was dishonoured. Now they have closed the partnership firm and dissolved it. Is there any remedy for me?
On the civil side all the partners are jointly liable to pay the amount but as far as criminal proceedings are concerned only the partner who issued/signed the cheque can be prosecuted.
We are 5 partners in a firm, 2 of partners are active and they are running the business and taking care of day to day affairs of the firm. My position is only as a sleeping partner. Cheques are signed and issued by the two working partners. If a cheque bounces and legal action takes place under section 489-F of the Pakistan Penal Code are all the partners liable or only those who have actually signed the cheque?
The person who issued the cheque will be prosecuted. On the civil side, if the person committing an offence is in a partnership or a company every person who at the time of the offence was in charge of and was responsible shall be deemed to be guilty and liable to be proceeded against and punished accordingly.
What about offences by companies in Pakistan?
If any cheque is issued dishonestly the signatory of that cheque and the CEO of the company will be prosecuted.
Josh and Mak International can advise you on stale cheques, cheques bouncing, recovery of debt, recovery of money, legal notices for cheque dishonour, the lodging of First Information Report (F.I.R.) and other related matters to all individuals, firms and companies, both local and foreign.
You can contact Josh and Mak International at 0300-5075993 for a detailed consultancy and advice.
Disclaimer: This Client Information Article is intended for informational purposes only and should not be construed as legal advice.
Coming Soon, important judgements on cheques being dishonoured.