Cheque dishonour (cheque bounce) is Nepal's highest-volume criminal complaint — tens of thousands flood police and prosecution offices every year. The May 2025 second amendment to the Banking Offence and Punishment Act, 2064 rebalanced the law: banks must now give the drawer a 45-day cure notice, only police may investigate, and compromise at any stage ends criminal liability.
Whether you hold a bounced cheque or issued one in a genuine cash-flow crisis, procedure is everything now — missed timelines kill complaints, and timely payment plus compromise kills prosecutions. We handle the full cycle on both sides.
The Nepalese laws that govern this area — what each one does in your matter.
Criminalises issuing cheques without sufficient funds, account and loan fraud, and electronic abuse. Only police may now investigate cheque cases.
Cheque amount + interest + 5% fine + graded jail
Bank returns cheque → holder seeks certification → 45-day deposit notice to drawer with record → certification within 3 days of re-presentation if still unpaid.
Cure within 45 days = no case
Full cheque amount + interest + 5% fine, with imprisonment by slab: up to 1 month (≤ NPR 15 lakh), 1–3 months (≤ 50 lakh), 3 months–1 year (≤ 1 crore), 1–2 years (≤ 10 crore), 2–4 years (above 10 crore).
1 mo (≤ NPR 15L) → 4 yrs (> NPR 10cr)
If the drawer pays the cheque amount and both sides agree, compromise through the government attorney (during investigation) or court (after filing) ends all punishment under the Act.
Payment + compromise = zero punishment
Complaint within 1 year of dishonour certification; case before the District Court within 6 months of complaint.
Miss the window, lose the case
Cheque & notice audit
We verify presentation, return memo, the 45-day notice record and certification — most cases are won or lost here.
Complaint or response
For holders: FIR within limitation. For drawers: payment within 45 days or a compromise proposal before charge sheet.
Investigation handling
Statements, bank records and the certification trail — managed so nothing irreversible is conceded.
District Court trial
Cheque-bounce trials run before the District Court; we press limitation, procedure and compromise defences.
Recovery & closure
Decreed amount, interest and fine enforcement — or a recorded compromise that closes the criminal case entirely.
Punishments at stake
Conviction means paying the full cheque amount with interest plus a 5% fine, and slab-graded imprisonment from one month up to four years depending on the cheque amount — unless a compromise is recorded, which wipes out punishment.
I received a bounced cheque. What is the first step?
Present it, get the bank's return memo, and ask the bank to certify dishonour after the 45-day notice cycle. Then file a police complaint within one year of certification. Do not sit on it — limitation is strict.
I issued a cheque that bounced due to a genuine crisis. Am I a criminal now?
Not necessarily. Deposit the amount within the bank's 45-day notice period, or pay and record a compromise under Section 26A even after the case starts — compromise ends criminal liability.
Can we settle a cheque case privately?
Yes, and the 2025 amendment formalised it: pay the cheque amount, apply jointly for compromise through the government attorney or court, and the prosecution closes with no punishment.
General legal information for public awareness — not legal advice for your specific situation. Consult an advocate →