Cheque Bounce Charges in India: What Both Sides Pay (Bank-Wise Breakdown)

When a cheque bounces, two bank accounts take a hit — not one.

The person who issued the cheque pays a return charge to their bank. The person who deposited it pays a return charge to their bank. Same cheque. Two deductions. Most people only find out about one of them — and the other person usually has no idea they were charged at all.

Two Sides, Two Charges

Banks call these outward return charges (charged to the drawer — the person who issued the cheque) and inward return charges (charged to the payee — the person who deposited it). Same bounce, two accounts, two banks.

Here is what the major Indian banks currently charge.

Drawer's Bank Charges (Outward Return)

Payee's Bank Charges (Inward Return)

All charges attract GST at 18%. Verify your bank's current published schedule before relying on these figures — fee schedules are updated without announcement, and the amounts for your specific account type may differ.

The Repeat Bounce Problem

HDFC and Kotak both escalate their charges on successive bounces. HDFC goes from ₹400 to ₹500 by the third instance; Kotak doubles from ₹350 to ₹750 from the second bounce in the same month.

If there is an ongoing dispute and the payee keeps presenting the same cheque, every re-presentation is a fresh charge on your account. Three bounces at HDFC in one month: ₹400 + ₹450 + ₹500 = ₹1,350 in bank charges alone, before a single court filing.

No judicial cap exists on successive return charges. Only your account agreement governs it.

Does a Cheque Bounce Hit Your CIBIL Score?

Directly — no.

Credit bureaus (CIBIL, Experian, CRIF) collect repayment data on loans and credit cards. A cheque return on a savings or current account is not reported as a credit event.

Three situations change this:

If the bounced cheque was an EMI payment. The dishonour is treated as a missed EMI — because that is what it is. It gets reported to credit bureaus the same way a payment default would. Your credit score takes the hit directly.

If the same account bounces repeatedly. Banks flag these accounts internally as high-risk. No entry on your CIBIL report, but expect difficulty getting a credit card, overdraft, or FD-linked product from the same bank. (Lenders also pull twelve months of account statements when you apply for a home loan — a pattern of returns shows up there even if CIBIL doesn't record them.)

If a Section 138 case produces an unsatisfied court decree. An unpaid court order surfaces in any formal background verification a lender or employer runs. CIBIL may not flag it, but the legal record does.

When the Bank Owes You the Money Back

Not every bounce is your fault.

Signature mismatch — when the signature was not actually wrong. Banks return cheques marked "signature differs" even when the signature matches their records. Write to the branch manager with a copy of the returned cheque and your specimen signature card. Request a reversal. Do this in writing.

System or technical errors. Banks return cheques for internal clearing failures unconnected to your account balance or cheque details. PNB charges nil for technical returns. ICICI charges ₹50 instead of ₹500. When the error is the bank's, you can claim a full reversal through the Banking Ombudsman.

Errors in the cheque made by the payee. If the cheque was incorrectly filled by the person who received it — amount in words doesn't match figures — the return is not on you.

To claim: write to the branch manager. If the bank doesn't respond within 30 days, file at cms.rbi.org.in. No filing fee. Consumer courts treat the published bank schedule as the ceiling. A Delhi District Court judgment in March 2025 — ICICI Bank Ltd. v. Rubi Begum — found that charges of ₹10,030 levied on a customer were "not justified as per RBI guidelines."

What RBI Actually Permits

RBI sets no rupee ceiling on cheque return charges. The Master Circular on Customer Service requires charges to be transparent and commensurate with the cost of the service — which means:

• Your bank cannot charge more than its own published schedule

• Charges above the published rate are a straightforward ombudsman complaint

• The schedule must be displayed on the bank's website and at branches

One protection specific to account type: if you hold a Basic Savings Bank Deposit (BSBD) account — Jan Dhan accounts fall under this — RBI's BSBD guidelines restrict what banks can charge. Whether cheque return charges are permissible on a BSBD account depends on the circular in force at the time; check directly with your branch before assuming the standard table above applies.

What a Section 138 Case Actually Costs

The bank charge is the first number. It is not the important one.

For the complainant:

• Inward return charge: ₹150–₹500

• Advocate fee for legal notice: ₹1,000–₹5,000

• Court filing fees (Delhi): 7.5% on the first ₹1 lakh of the cheque amount (capped at ₹5,000), then 5% above ₹1 lakh. A ₹5 lakh cheque = ₹7,500 in court fees alone. State slabs vary — Madhya Pradesh uses a 5%/4%/3% sliding scale.

• Advocate fees per hearing: ₹2,000–₹20,000 depending on court and seniority

• Average hearings before resolution: 8–15

• Realistic total: ₹20,000–₹1,50,000+

For the accused:

• Outward return charge: ₹150–₹750

• Advocate fee to respond to the notice: ₹1,000–₹3,000

• Advocate fees per hearing: same range

• Section 143A risk: the Magistrate has discretion to order up to 20% of the cheque amount as interim compensation while the trial is pending. On a ₹5 lakh cheque, that is ₹1 lakh out before the verdict. The Supreme Court confirmed in Surinder Singh Deswal v. Virender Gandhi (2019) 11 SCC 341 that this is discretionary — but Magistrates at Patiala House and Tis Hazari routinely grant it on first application.

• Realistic total: ₹25,000–₹2,00,000+

If the cheque amount is above ₹50,000 and there is any chance of a Section 138 notice, consult an advocate before you respond or allow a second presentation.