Cheque Bounce Law in Nepal - Easy guide to get the remedies in Cheque Bounce 2026

This article will help you to know all about the cheque bounce law in Nepal, the cheque bounce remedies process, and the acts relating to cheque bounce.

Cheque bounce is a condition in which a bank refuses to exchange the issued cheque to the receiver due to reasons such as:

1. Insufficient fund or
2. Overwriting on the cheque or
3. Mismatch of signature or
4. The signature is absent or
5. Problem with the cheque’s date or
6. Account for differences in numbers and words

Cheque bounce is regarded as one of the types of dishonour of a cheque. In Nepal, the following two Acts regulate the cheque bounce law in Nepal:

1. Negotiable Instruments Act, 2034 (1977) (First amended in 2039)
2. Banking Offence and Punishment Act, 2064 (2008) (no amendments till now)

1. Negotiable Instruments Act, 2034

Section 53(10) of this Act states that if a cheque is not drawn for payment within six months, the bank is not bound to give payment for the same.

The complaint has to be filed within 5 years from the date of the cause of action(2) and has to be filed in the district court. The cheque must bounce three times, and the bounce letter must be attached to the FIR application.

Cheque Bounce Law in Nepal - The Process of Cheque Bounce Remedies

As per the Negotiable Instruments Act, 2034

Step 1: Filing of FIR
Step 2: Counterclaim
Step 3: Collection of evidence
Step 4: Hearing and final decision
Step 5: Appeal to the High Court

Remedies available under the Act:
If a cheque is bounced, the amount mentioned in the cheque, as well as interest, shall be recovered, and the holder shall be punished with imprisonment up to 3 months or a fine up to Rs. 3,000 or both.

2. Banking Offence and Punishment Act, 2064

This Act defines cheque bounce as where the holder already has knowledge that the account does not have sufficient balance.

The Act mentions that an FIR must be lodged within 1 year of the date the offence occurs. This Act identifies cheque bounce as a state-party offence.

Also Read: Business Visa in Nepal Procedure

Process of Cheque Bounce Remedies and Procedures in Nepal as Per Banking Offence and Punishment Act, 2064

Step 1: Filing of FIR
Step 2: Police investigation
Step 3: Charge sheet (the charge sheet is filed by the public prosecutor in the concerned High Court).
Step 4: Hearing for bail
Step 5: Witness examination
Step 6: Appeal to the High Court

Depending on the claimed amount, the following is the provision:

There are other situations as well, offering their own imprisonment and fine. In sum, we can see fine ranges, a minimum of Rs. 10,000 and a maximum of Rs. 10,00,000, and imprisonment, a minimum of 1 year and a maximum of 5 years.

Conclusion

Negotiable Instruments Act, 2034 provides for recovery of interest on the claimed amount, while Banking Offence and Punishment Act, 2064 does not provide for the same.