Finance Minister proposes strict measures for cheque bounce offence

KATHMANDU: Finance Minister Bishnu Prasad Paudel announced that the Bill amending the Banking Offence and Punishment Act-2064 BS has been officially registered in parliament.

According to Minister Paudel, the Bill aims to enhance the effectiveness of investigations, prosecutions, and penalties related to banking offences, including cases of bounced cheques.

During his address to the House of Representatives (HoR) Finance Committee today, Minister Paudel emphasised the importance of imposing fines in cases of banking fraud, particularly related to cheque bounces.

Lawmaker Swarnim Wagle also advocated prioritising fines over jail sentences for banking fraud, citing global practices. He urged swift action on passing the Bill.

Meanwhile, another lawmaker, Padam Giri, criticised the parliament's limited legislative role, which has resulted in pending bills within the Committee.

The Bill was initially proposed by former Finance Minister Prakash Sharan Mahat on September 2, 2023. The government recognised the necessity for legal amendments, especially concerning different treatment for cheque bounce cases, uniformity in legal approaches, and assessments by the Office of the Attorney General.

The proposed Bill outlines that if an account holder lacks sufficient funds to cover a cheque payment, the cheque should be returned to the bearer.

To establish a case of cheque bounce, the bearer must ensure that the necessary funds are deposited within 30 days after being notified by the respective bank.

Additionally, the Bill prohibits account holders from issuing cheques exceeding their available balance. Penalties for bounced cheques include fines and imprisonment.

For due amounts up to Rs 500,000, imprisonment of up to one month is proposed. Amounts ranging from Rs 1 million to 5 million could result in imprisonment of up to six months, while amounts exceeding Rs 5 million may lead to up to two years of imprisonment. The Bill allows cases to be registered at the respective District Court within three months if a cheque bounce is proven.

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