Cabinet considers amending act to help victims of cheque dishonouring
The cabinet on Friday considered a proposal to amend the Negotiable Instruments Act, 1881 which will help trade and commerce, particularly in the MSME sector and increase the credibility of the cheque as a financial instrument, a source confirmed to DNA.
The proposal was to amend the Negotiable Instruments Act, 1881 to provide for interim compensation to the payees of the cheque, both at the Trial stage and Appellate stage.
Dishonour of cheques due to inadequate funds in the account of the drawer of the cheque or for other reasons cases serious distress in the trade, business and MSME sectors, which in turns causes inconvenience to payees and erodes the credibility of cheques.
The Cabinet today considered a proposal to amend the Negotiable Instruments Act, 1881 to address various representations form the public and trading community regarding the injustice caused to payees.
A source told DNA that the amendment would enable the Court order to interim compensation to the payee of a cheque a part of the amount at trial stage.
If the drawer is acquitted, the Court may direct the payee to repay the amount paid as interim compensation with interest, while the Appellate Courts would be enabled to order the appellant to deposit …read more
