New Delhi: The Confederation of All India Traders (CAIT) Has urged Union Finance Minister Nirmala Sitharaman not to decriminalise Cheque Bounce. In a letter to the Finance Minister the national traders’ body has pleaded the Government not to decriminalize Section 138 of the Negotiable Instruments Act, 1881 under any circumstances saying such a move will not only nullify the sanctity of the Cheques and the Banking Sector of India but also contradict the PM Shri Narendra Modi’s vision of a fair and trustworthy business environment in the country by deeply impacting the business sentiments of millions of small traders and manufacturers who consider a post dated cheque as a very important instrument to conduct trade and maintain the supply chain.
Explaining the serious issue CAIT National President Mr. B.C.Bhartia & Secretary General Mr Praveen Khandelwal said that in a bid to improve ease of doing business and unclog the courts, the Government wants to do away with minor financial offences that do not impact national security and we understand the motive of the Government, but to decriminalize a most important section like 138 will be like shooting in the foot as instead of creating a fair, honest and trustworthy business environment such a step will completely distort the business conditions and give tremendous rise to unfair and unethical trade practices all across the country thereby putting crores of businessman under the severe risk of losing money to immoral and fraudulent elements of society. Not only the traders but people will also find it difficult to purchase any goods on EMI since EMI is always supported by Post dated Cheques and henceforth no one will accept post dated cheques, if it is decriminalised.They further said that on the one hand the Government has recently included Section 143 & 148 to make the NI Act more effective and powerful in providing redress to the complainants, on the other hand diluting the Act is completely unwarranted and contradictory.
Mr. Bhartia & Mr. Khandelwal said that bouncing of cheques issued against an enforceable debt must be taken as a very serious issue and there is an all round voice from millions of traders that CAIT must make all efforts to stop the Government from decriminalizing such an offence. He further added that Post dated cheques are an important instrument of business in India and also ensure sufficiency of working capital by acting as guarantees for several modes of
finance and credit.
Mr. Bhartia & Mr. Khandelwal further said that if the person issuing the cheque knows that there is no criminal liability then it will give rise to the ease of being dishonest rather than promoting ease of doing business. The entire fundamentals of trade will be destroyed and traders will be left at the mercy of civil litigation which takes several years for justice. Even after the current stringent section 138, more than 20 % of all pendency of cases across the country is only pertaining to cheque bounce.If it is decriminalized, there will be complete disarray and disturbance in trade dynamics.
Both leaders said that the Government should in fact work on a system to further strengthen the sanctity of the cheques in the best interest of crores of traders of India who are heavily dependent on Post dated Cheque for conducting their routine business. They also added that such a move by the Government might severely impact the supply chain in the country as most traders do business on credit on the basis of these Postdated cheques.
