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Understanding 'Contact Drawer Drawee' in Cheque Bounce Cases
In the realm of financial disputes, few phrases strike more fear than a cheque bounce notice. But what happens when your returned cheque bears the cryptic bank endorsement contact drawer/drawee bank and present again? Does this trigger liability under Section 138 of the Negotiable Instruments Act, 1881? This blog post breaks down the legal implications based on key judicial precedents, helping you navigate this common yet tricky scenario.
Note: This is general information based on case law. Legal outcomes depend on specific facts. Consult a qualified lawyer for advice tailored to your situation.
What Does 'Contact Drawer Drawee' Actually Mean?
When a bank stamps a cheque with kindly contact drawer/drawee bank and present again, it's not confirming insufficient funds or stop payment – the two primary triggers for Section 138 proceedings. Instead, it's a vague instruction signaling some irregularity that requires clarification from the drawer (cheque issuer) or drawee bank (bank on which cheque is drawn).
Key Definitions Under NI Act
- Drawer: The person who issues the cheque (you, if accused).
- Drawee: The bank directed to pay (your bank account's bank). Sivakumar VS Surya Exports & Imports A firm Rep. by its Proprietor Mr. N. Surya Srinivas - 2022 Supreme(Mad) 1817
This endorsement typically appears as Code 5 or similar, and courts have repeatedly held it does not satisfy Section 138 requirements. D. S. Shridhar VS P. John - 2022 Supreme(Telangana) 797
Judicial Precedents: Why Proceedings Get Quashed
Indian courts, including High Courts, have consistently quashed Section 138 complaints where cheques were returned with this memo. Here's why:
1. Statutory Requirements Not Met
Section 138 applies only when a cheque is dishonoured due to:
- Insufficient funds
- Exceeds arrangement with the bank
Vague endorsements like contact drawer/drawee don't qualify. As one court ruled:
The reasons given by the banker did not meet the requirements mentioned under Sec. 138 of the Negotiable Instruments Act... proceedings against the petitioner were quashed. D. S. Shridhar VS P. John - 2022 Supreme(Telangana) 797
2. Multiple Case Examples
- Zaheerabad Case: Cheque returned twice with 'kindly contact drawer/drawee bank'. Court quashed CC No.287/2018, holding bank reasons must conform to the twin reasons assigned under the Act. D. S. Shridhar VS P. John - 2022 Supreme(Telangana) 797
- Chennai Case: Similar endorsement led to quashing because it was not returned by the drawee bank. RAZAK P.S. vs ASHRAF AGALPADY - 2023 Supreme(Online)(KAR) 1001
- Indore Proceedings: Complaint quashed as notice wasn't duly served and cheque wasn't dishonoured per Act provisions. Sachin Dubey VS Kishore Sharma - 2018 Supreme(MP) 973
3. Burden on Complainant
The complainant must prove:
1. Cheque presented to drawee bank
2. Returned unpaid for statutorily specified reasons
3. Valid demand notice served
4. Non-payment within 15 days
Contact drawer/drawee fails at step 2. Courts emphasize: A cheque must be presented to the drawee bank to constitute an offence under Section 138. RAZAK P.S. vs ASHRAF AGALPADY - 2023 Supreme(Online)(KAR) 1001
When Might It Still Lead to Liability?
Not every case ends in quashing. Some courts refuse early dismissal:
Exceptions and Trial Requirements
- Factual Disputes: If cheque was re-presented and later bounced for insufficient funds, proceedings may continue. R.THIRUVENGADA RAMANUJA DOSS vs M/S.SUNIL AND CO, PROPRIETOR, SUNIL KUMAR BAGMAR, REP BY ITS POWER AGENT, MAHENDRA KUMAR BAGMAR - 2026 Supreme(Online)(Mad) 19396
- Cross-Examination Needed: There are so many reasons to issue direction to contact drawer drawee bank. It has to be elicited only by cross examination. R.THIRUVENGADA RAMANUJA DOSS vs M/S.SUNIL AND CO, PROPRIETOR, SUNIL KUMAR BAGMAR, REP BY ITS POWER AGENT, MAHENDRA KUMAR BAGMAR - 2026 Supreme(Online)(Mad) 19396
- Stop Payment Implied: Some rulings hold even stop payment triggers liability, but contact drawer alone doesn't imply this. Servalakshmi Paper Limited VS State Of Gujarat - 2019 Supreme(Guj) 1147
In Pulsive Technologies v. State of Gujarat, stop payment was sufficient, but distinguished from vague endorsements. Servalakshmi Paper Limited VS State Of Gujarat - 2019 Supreme(Guj) 1147
Practical Implications for Accused and Complainants
For the Accused (Drawer)
- File to Quash under CrPC Section 482 immediately if endorsement is contact drawer/drawee.
- Preserve bank memos – crucial evidence.
- Challenge jurisdiction if facts don't align with Section 138. Prabhu Dayal Modi v. M/s. Euro Developers Pvt. Ltd. and Another - 2011 Supreme(Online)(Bom) 4
For Complainants
- Re-present cheque to drawee bank promptly.
- Get clear memo (insufficient funds/stop payment) before notice.
- Serve proper demand notice specifying amount and 15-day deadline. Manoj Kr. Narzary, Son of Chabiram Narzary VS Shri Haradhan Das, Son of Late Churamoni Das - 2016 Supreme(Gau) 505
The notice issued was imperfect as it did not contain a specific demand for payment... complaint was not maintainable. Manoj Kr. Narzary, Son of Chabiram Narzary VS Shri Haradhan Das, Son of Late Churamoni Das - 2016 Supreme(Gau) 505
Related Legal Principles from Case Law
While focused on cheque bounces, search results reveal broader themes:
Criminal vs Civil Disputes
- Cheating (IPC 420) requires dishonest intention at inception, not mere breach of contract. Hridaya Ranjan Pd. Verma VS State Of Bihar - 2000 3 Supreme 13
Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning. Hridaya Ranjan Pd. Verma VS State Of Bihar - 2000 3 Supreme 13
- Abuse of Process: Courts quash proceedings cloaking civil loan recovery as criminal. G. Sagar Suri VS State Of U. P - 2000 1 Supreme 322
Bank Guarantees and Letters of Credit
Distinct from cheques – injunctions rarely granted against encashment. United Commercial Bank VS Bank Of India - 1981 Supreme(SC) 209
Key Takeaways
- Contact drawer/drawee bank ≠ Section 138 offence – proceedings typically quashed. D. S. Shridhar VS P. John - 2022 Supreme(Telangana) 797 RAZAK P.S. vs ASHRAF AGALPADY - 2023 Supreme(Online)(KAR) 1001
- Complainant bears proof burden – vague endorsements fail.
- Re-present cheque before legal action.
- Civil remedies (summary suits) often better for pure debt recovery.
- Early quashing saves time/money – act fast with CrPC 482 petition.
Conclusion
The phrase contact drawer drawee is a bank's way of saying something's off, but not clearly insufficient funds. Courts protect accused from overreach, ensuring Section 138 targets genuine banking offences, not ambiguous returns. If facing such a case, review your bank memo carefully – it might be your strongest defence.
This analysis draws from multiple precedents including D. S. Shridhar VS P. John - 2022 Supreme(Telangana) 797, RAZAK P.S. vs ASHRAF AGALPADY - 2023 Supreme(Online)(KAR) 1001, Sachin Dubey VS Kishore Sharma - 2018 Supreme(MP) 973, R.THIRUVENGADA RAMANUJA DOSS vs M/S.SUNIL AND CO, PROPRIETOR, SUNIL KUMAR BAGMAR, REP BY ITS POWER AGENT, MAHENDRA KUMAR BAGMAR - 2026 Supreme(Online)(Mad) 19396, and others. Each case turns on facts; professional advice essential.
Stay informed, issue cheques cautiously, and remember: cheque bounce law protects commerce, not shortcuts to recovery.
Search Results for "Contact Drawer Drawee: Cheque Bounce Legal Impact"
2000 1 Supreme 322 • India - Supreme Court
D.P.WADHWA, S.SAGHIR AHMAD
offences with a sole purpose of getting the loan due to the Finance Company by browbeating and tyrannizing the appellants of criminal ... It is to be seen if a matter, which is essentially of civil nature, has been given a cloak of criminal offence. ... Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. ... the....
2000 3 Supreme 13 • India - Supreme Court
D.P.MOHAPATRA, K.T.THOMAS
is a find one. ... In determining the question it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating ... breach of contract cannot give raise to criminal prosecution for cheating-It is necessary to show that person making promise had ... account of the drawer. ... which no prudent person can ever reach a just conclusion that there is sufficient ground for proceed....
1985 0 Supreme(SC) 393 • India - Supreme Court
E.S.VENKATARAMIAH, O.CHHINNAPPA REDDY, R.B.MISRA, V.BALAKRISHNA ERADI, V.KHALID
the true and full sense of the term, with all the rights of a shareholder, only when the transfer is registered in the company’s ... with the transferor. ... , to call an extraordinary general meeting in accordance with the provisions of the Act. ... the drawee or holder thereof or any other party thereto, either in Indian currency or in foreign currency or partly in one and partly ... It is a clear case of an atte....
2001 5 Supreme 49 • India - Supreme Court
insufficient funds in the Appellant s account with the drawee, viz. ... the notice and the non payment after receipt of notice by the drawer of the cheque. ... on ground "not arranged for"-Notice of demand served and not complied with-Complaint filed before Special Court against drawer Mr ... with the drawee, viz. ... the notice and the non payment after receipt of notice by the drawer#H....
1997 5 Supreme 485 • India - Supreme Court
KULDIP SINGH, S.SAGHIR AHMAD
Commerce- Deficiency in service-Respondent entered into contract with French Firm for supply of goods-Goods shipped to Buyer-Respondent ... accepted in accordance with the instructions of the "Principal". ... of Exchange about co-acceptance by the French Bank was enough and the appellant having not acted in terms of the Bill of Exchange ... making presentation to the "Drawee". ... The "drawee" is ....
2022 0 Supreme(Telangana) 797 • India - Telangana
K. SURENDER
lakhs, which was returned unpaid twice with the reason 'kindly contact drawer/drawee bank and please present again'. ... the reasons for prosecuting a drawer of the cheque. ... by the banker did not conform to the twin reasons assigned under the Act. ... Banker to contact the drawer or drawee bank and present again will not amount to a reason for which, the prosecution under Sec.....
2019 0 Supreme(Guj) 1147 • India - Gujarat
A.S.SUPEHIA
The cheque was deposited and it returned with a remark to contact drawer/drawee bank and present it again. ... State of Gujarat, this Court has already held that instruction of "stop payment" issued to the banker could be sufficient to make ... Kuchil Kumar Nandi, this Court has clarified that if a cheque is dis-honoured because of stop payment instruction even then offence ... T....
2018 0 Supreme(MP) 973 • India - Madhya Pradesh
VANDANA KASREKAR
to the lack of proper service of notice and the alleged dishonor of the cheque. ... section 138(1) of the Negotiable Instruments Act, and the cheque was not dishonored as per the provisions of the Act. ... of the proceedings under section 138 of the Negotiable Instruments Act, 1881 before the Judicial Magistrate First Class, Indore. ... with remarks "kindly contact drawer/drawee ....
2023 Supreme(Online)(KAR) 1001 • India - High Court of Karnataka
HEMANT CHANDANGOUDAR, J
The petitioner contended that a cheque returned by the drawer bank could not constitute an offence, a point the court agreed with ... of 'bank' as clarified in prior case law. ... The court analyzed the provisions of Section 138 of the Negotiable Instruments Act regarding dishonored cheques and the definition ... contact drawer/drawee bank and present again, which clearly implies that the subject cheque was not returned by the drawee#HL_END....
2020 0 Supreme(Bom) 669 • India - Bombay
NUTAN D.SARDESSAI
In that view of matter learned Judge observed that no case was made out to interfere with order under challenge and dismissed petition ... case under Act had to be decided within a period of three months and looking to conduct of case which has spilled over years was ... of view that application was nothing but a tactic to protract hearing of case and which conduct was required to be deprecated - ....
2022 0 Supreme(Telangana) 797 • India - Telangana
K. SURENDER
The Bank has returned twice for the reason 19 stating 'kindly contact drawer/drawee bank and please present again' which was handwritten. ... The said cheque was presented for clearance and the same was returned unpaid on 17/7/2018 for the reason of 'kindly contact drawer/drawee bank and present again'. ... The Bank has returned the cheque by specifically mentioning reason of 'kindly contact drawer/drawee bank and please present aga....
2023 0 Supreme(Cal) 1372 • India - Calcutta
SIDDHARTHA ROY CHOWDHURY
The drawee presented the cheque and it was not honoured by bank due to insufficient fund. The drawee, thereafter, sent a legal notice through his lawyer to the drawer of the cheque within the statutory period. ... Therefore, the drawer had option to acknowledge the action on his part and to pay money or to deny his obligation to pay. Here in this case the drawer took a plea of making payment of the cheque amount prior to the date of notice, issued on behalf of the drawee. ... By conven....
2025 Supreme(Online)(Mad) 10421 • India - IN THE HIGH COURT OF JUDICATURE AT MADRAS
HONOURABLE MRS. JUSTICE L. VICTORIA GOWRI
However, in the instant case, the reason for return is nothing but “Kindly contact drawer/drawee bank and present again.” ... The Bank has returned the cheque by specifically mentioning reason of ‘kindly contact drawer/drawee bank and please present again’ which is in the handwriting of the banker stating that drawer or drawee bank has to be contacted and then present the cheque. ... As seen from the cheque return memo, the reason of ‘funds insuffici....
2011 Supreme(Online)(Bom) 4 • India - Bombay High Court
A.S. Oka, J
"(i) drawing of the cheque; (ii) presentation of the cheque to the Bank; (iii) returning the cheque unpaid by the drawee Bank;(iv) giving a notice in writing to the drawer of the cheque demanding payment of the cheque amount; and(v) failure of the drawer to make payment within ... /law/10949">Negotiable Instruments Act, 1881 , which provides that a cheque must, in order to charge the drawer, be presented at the bank upon which it is drawn before the relation between the drawer and his banker has been al....
2023 Supreme(Online)(KAR) 1001 • India - High Court of Karnataka
HEMANT CHANDANGOUDAR, J
Learned counsel for the petitioner/accused submits that the cheque was returned by the drawer bank calling upon the complainant to contact drawer/drawee bank and present again, which clearly implies that the subject cheque was not returned by the drawee i.e, by 'the Bank'. ... Admittedly, the subject cheque was not presented by the drawee bank for realization and before it was presented, the drawer bank issued the endorsement. ... In the instant case, there is no mate....
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