Multiple choice

Which of the following is now a punishable offence by a bank account holder?

  1. Issuing cheques with overdraft facilities with a bank

  2. Cheque bouncing for insufficiency of funds in the account

  3. Issuing a post-dated cheque

  4. Issuing a cheque which is not crossed

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Cheque bouncing due to insufficient funds is a punishable offence under Section 138 of the Negotiable Instruments Act. The drawer can face imprisonment up to 2 years and/or a fine. This provision was introduced to ensure financial discipline and protect the interests of payees. Other options like issuing post-dated cheques or uncrossed cheques are not criminal offences under normal banking operations.

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