Re: Legal opinion on dishonored cheques A/c. M/s. Company 1.
We refer to your letter dated 14.09.2006 received by us on 21.09.2005 on the above subject. We have perused the letter and our opinion on the issues sought for is as follows:
Since the drawee bank Bank 1 dishonoured the cheques on further presentation on 10.05.2006, showing reason ‘Payment stopped by the drawer’ and meanwhile the validity for presentation of the cheques expired, Bank Asia Limited may file Money Suit against the endorser and issuer of the cheques to recover the aggregate cheque amount by serving notice upon them demanding to pay the amount within a specific reasonable period.
There is another option for the Bank to file Criminal Case against the endorser and issuer of the cheques under section 406, 420, 34 and 109 of the Penal Code for dishonour of the cheques by the drawee bank showing reason ‘Payment stopped by the drawer’, through this proceeding they can be liable criminally but the cheque(s) amount cannot be recovered.
All papers/documents referred to us are returned herewith. Kindly acknowledge receipt.
For: “The Lawyers & Jurists”