A person gave me a post-dated cheque but now refusing to pay it. The post-dated cheque will mature on 10/05/2020. Sir, I want to know what should I do in this situation?

Question from: Gujrat

You cannot take any legal action against that person before the maturity of the post-dated cheque. The drawer issues the post-dated cheque for the discharge of debt or liability. When he issues the said post-dated cheque he admits that he has some financial liability. Therefore, the law will presume the existence of financial liability under Section 139 of the Negotiable Instrument Act.

In this situation, you should wait for the date of maturity of the post-dated cheque. You should present that cheque before the bank on the date of maturity. If he dishonours the cheque due to insufficient amount or any other reason then you should proceed against him. The oral statement or intimation of the drawer that he will not pay the cheque has no legal validity.

You should not rely on his oral statement before the date of maturity of the post-dated cheque. No cause of action arises out of that oral statement. According to Section 142 of the Negotiable Instrument Act, the cause of action arises when the drawer does not pay the amount within 15 days of receiving the demand notice.

Therefore, you have to follow the procedure given in the Negotiable Instrument Act. The oral statement of the person that he will not pay the cheque amount has no legal sanctity. You cannot initiate any legal action on the basis of his oral statement.

Presentment of cheque

You should present the cheque within three months from the date of maturity. Presentment of the cheque within time is mandatory under section 138 of the Negotiable Instrument Act. If you do not present the cheque within a time the post-dated cheque will lost its legal status. The cheque is an instrument for discharging of the debt or liability and it is valid for three months from the date of maturity.

Section 138 of the Negotiable Instrument Act said that the cheque should be presented to the bank within a period of three months. After the amendment in section 138, the period of maturity is shortened by three months. Before the amendment, there was a six month period for the presentment of the cheque

Send a demand notice

If that person (drawer) refuses to make the payment of the post-dated cheque then you should give him a demand notice within 30 days. The time period of 30 days starts when you receive the memo of dishonour of cheque from the bank.