Overview
The Counsel assists businesses, entrepreneurs, MSMEs, and organisations with legal matters relating to commercial transactions and business operations. Services are available at every stage — from business formation advisory and contract drafting to dispute resolution and commercial litigation.
Adv. Kiran H. Mulik represents clients before the Commercial Court, City Civil Court, District Courts, Consumer Commissions, and Arbitral Tribunals in Navi Mumbai and Mumbai.
Services
Contract Drafting & Review
Contract Negotiation
Vendor & Service Agreements
Employment Contracts
MOU & Joint Venture Agreements
Cheque Dishonour — S.138 NI Act
Recovery Proceedings & Debt Recovery
Consumer Disputes
Arbitration & Commercial Mediation
Commercial Litigation
Legal Notices & Replies
Startup & MSME Legal Advisory
Cheque Dishonour — Section 138, Negotiable Instruments Act
When a cheque issued towards a debt or liability is returned unpaid (dishonoured) by the bank, the payee has a legal remedy under Section 138 of the Negotiable Instruments Act, 1881. This is a criminal complaint that may result in imprisonment of up to 2 years or a fine up to twice the cheque amount, or both.
1
Cheque Presented & Dishonoured
The cheque is presented to the bank and returned unpaid due to insufficient funds or any other reason.
2
Legal Notice Issued
A demand notice must be sent to the drawer within 30 days of receiving the dishonour memo from the bank.
3
15-Day Payment Period
The drawer has 15 days from receipt of notice to make the payment.
4
Complaint Filed
If payment is not made within 15 days, a criminal complaint is filed before the Magistrate Court within 30 days of expiry of the notice period.
5
Trial & Outcome
The Magistrate conducts a trial. Conviction may result in imprisonment up to 2 years and/or a fine up to twice the cheque amount.
Important Timeline
Notice must be issued within 30 days of receiving the dishonour memo. Complaint must be filed within 30 days of expiry of the 15-day notice period. Missing these deadlines can affect the maintainability of the complaint.
Arbitration & Commercial Mediation
Arbitration is a private dispute resolution mechanism where disputes are resolved by an arbitrator (or arbitral tribunal) outside the court system. The Arbitration & Conciliation Act, 1996 governs arbitration proceedings in India.
Arbitration is often preferred in commercial disputes because it is faster than regular court proceedings, the parties can choose their arbitrator, and arbitral awards are enforceable. The firm advises on including arbitration clauses in commercial contracts and represents clients in arbitral proceedings.
- Drafting arbitration clauses in commercial contracts
- Appointment of arbitrator applications before courts
- Representation in arbitral proceedings
- Enforcement of domestic arbitral awards
- Commercial mediation and settlement negotiations
Applicable Legislation
- Negotiable Instruments Act, 1881 (Section 138)
- Indian Contract Act, 1872
- Consumer Protection Act, 2019
- Arbitration & Conciliation Act, 1996
- Companies Act, 2013
- MSME Development Act, 2006
- Specific Relief Act, 1963
- Code of Civil Procedure, 1908
Frequently Asked Questions
What is the time limit for filing a cheque bounce case?
A legal notice must be issued to the drawer within 30 days of receiving the bank's dishonour memo. If the drawer fails to make payment within 15 days of receiving the notice, a complaint must be filed within the next 30 days. Strict compliance with these timelines is essential for the complaint to be maintainable.
Can a cheque bounce case be settled out of court?
Yes. Section 138 cases can be compounded (settled) between the parties at any stage — before filing, during trial, or even after conviction. Settlement is a common outcome in such cases, particularly where the drawer agrees to pay the cheque amount with interest and agreed compensation.
What documents are needed for a recovery suit?
Typically required documents include: the agreement or contract (if any), invoices and delivery receipts, bank statements showing the transaction, all correspondence between the parties (emails, letters, WhatsApp messages), the demand notice and proof of delivery, and any acknowledgement of debt by the defaulter.
What is the limitation period for commercial disputes?
Under the Limitation Act, 1963, the limitation period for a suit for recovery of money based on a contract is generally 3 years from the date the right to sue accrues (i.e., from the date of default or breach). Consulting an advocate early helps preserve all available legal options.
What is arbitration and when is it preferred over court litigation?
Arbitration is a private dispute resolution process governed by the Arbitration & Conciliation Act, 1996. It is preferred for commercial disputes where the parties want a faster resolution, privacy, technical expertise of the arbitrator, and finality of award. It is particularly suitable where the contract already contains an arbitration clause.
Does the firm assist startups and MSMEs?
Yes. The Counsel provides legal advisory services to startups and MSMEs including contract drafting and review, vendor agreements, employment contracts, recovery of dues, and dispute resolution. Early legal structuring helps businesses avoid costly disputes later.