City locals should be ready to face legal consequences if their cheque paid to Adani Electricity Mumbai Limited (AEML) bounces more than once. The Maharashtra Electricity Regulatory Commission (MERC) has allowed AEML to take legal action against consumers, who default on their cheques. The power distributor asked for a three-time hike in fine, which is Rs 750, for dishonoured cheques.

The MERC gave this order on March 19 wherein they allowed AEML — which distributes power to 25 lakh consumers in suburbs — to start taking legal action against certain consumers. The order stated: 'AEML can take action against wilful defaulters'. They have also asked the company to print the name of the receiving authority against whom the cheque will be drawn. Also, AEML can suspend the facility of paying bills through cheques for a defaulter for the next 6 months.

As cheque bounce falls within cognizable offences under Section 138 of the Negotiable Instrument Act, 1881; it is punishable with imprisonment for a term as long as two years, or with a fine which may extend to twice the amount of the cheque, or with both.

The AEML had applied to the MERC asking them to increase the fine for defaulting cheques from Rs 250 to Rs 750. This would be applicable for all those who default more than once. In 2018-19 (until December) there have been 38,975 cases of cheque default, while in the last four years, there have been 1,78,706 cases of cheque bounce.

Sources said that the number of first-time defaulters is between 38,000-40,000 on an average. However, those defaulting second and third time are between 5,000-7,000. Out of the total 25 lakh consumers, close to 3-4 lakh consumers make their payments through cheque.

"Most of these consumers are high-end consumers — both residential and commercial. They make payments through cheque. At least 5,000 cheques bounce each month after its presentation," said an AEML official.

HIGH STAKES

As cheque bounce falls within cognizable offences under Section 138 of the Negotiable Instrument Act, 1881; it is punishable with imprisonment, or with fine, or with both