Parties write a deed of settlement in a cheque bounce case when they compromise in the case.
The Negotiable Instruments Act, 1881, Section 138, governs cases involving bounced cheques. When a bank doesn’t honour a payment, a cheque bounces. A cheque is said to have been dishonoured or bounced when the bank returns it unpaid. Insufficient fund, Wrong signatures, mismatched numbers on the cheque (both in words and figures), and overwriting are a few of the causes.
Draft Deed of Settlement
THIS DEED OF SETTLEMENT is executed on this……day of January 2023 at New Delhi between …………Ltd., a company registered under the Companies Act, through its Director, Sh. …………………, having its office at …………., …………….., ………………., New Delhi (hereinafter referred to as the FIRST PARTY), which expression shall include its nominee, assign, representative, agents and successors.
AND
Mr. …………………, Proprietor M/s ………………… and Proprietor M/s …………. having its office at …………, ……………., ………………., ………………., New Delhi (hereinafter referred to as the SECOND PARTY), which expression shall include its nominee, assign, representative, agents and successors.
AND WHEREAS the party of the First Part had appointed the party of the Second Part as their Stockiest in Delhi for the sale of P.U. Adhesive.
AND WHEREAS the parties had been doing business with each other for the last four years.
AND WHEREAS the party of the Second Part had issued two cheques bearing no…………….. dated …………….. and …………….. dated …………….. in the sum of Rs.2 lakh each drawn on ……………..…………….. Ltd., …… Branch, New Delhi-110002 towards the security to the party of the First Part.
AND WHEREAS the party of the First Part to settle their dues with the party of the Second Part presented the aforesaid two cheques for payment and encashment with their bankers. The said cheques were however returned unpaid with the remarks “insufficient funds”.
AND WHEREAS the party of the First Part issued a notice to the party of the Second Part and Mr. …………….., under Section 138 of Negotiable Instruments Act calling upon the party of the Second Part and Mr. …………….. to make payment of the amount covered under the aforesaid two cheques.
AND WHEREAS the party of the Second Part thereafter filed a complaint before the District Courts, Bhiwani, Haryana claiming the amounts covered under the aforesaid two cheques bearing no. …………….. dated …………….. and …………….. dated …………….. in the sum of Rs.2 lakh each drawn on ……………..…………….. Ltd., …… Branch, New Delhi-110002 under Section 138 of the Negotiable Instruments Act.
AND WHEREAS the parties of the First Part and Second Part have now mutually agreed to settle all their disputes including the payments, if any due to the party of the First Part.
NOW THIS DEED OF SETTLEMENT IS WITNESSETH AS UNDER:
1.That the party of the Second Part has agreed to pay a sum of Rs.3,50,000/- (Rupees three lakhs fifty thousand only) towards full and final settlement of all the dues of the First Party. The details of the payment made by the Second Part to the First Part are given hereinbelow:
| S.NO. | PARTICULARS & DATE | CHEQUE / DD NO. | AMOUNT |
| 1. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (5.1.2023) | ………… | Rs.2,00,000/- |
| 2. | ……………., …………, New Delhi-110005 (6.1.2023) | ………… | Rs.1,00,000/- |
| 3. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.2.2023) | ………… | Rs.10,000/- |
| 4. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.3.2023) | ………… | Rs.15,000/- |
| 5. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.4.2023) | ………… | Rs.15,000/- |
| 6. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.5.2023) | ………… | Rs.10,000/- |
| TOTAL | Rs.3,50,000/- |
2. That the party of the First Part has agreed to receive the aforesaid sum of 3,50,000/- (Rupees three lakhs fifty thousand only) towards full and final settlement of all their dues against Mr. …………………, Mr. ………………, M/s ………………… and M/s ………………….
3. That the party of the First Part had also agreed and undertaken to return the two cheques bearing no.…………….dated ……… and ………… dated …………….in the sum of Rs.2 lakh each drawn on ……………. , ……………., New Delhi-110002, which have been filed by the First Party in the District Court, Bhiwani in the complaint filed by them against the Second Party.
4. That the First Party further agrees to withdraw all their cases including the complaint against the Second Party and shall not claim any amount whatsoever from the Second Party covered under the two cheques bearing no. …………… dated ……………. and ……………. dated ……………. in the sum of Rs.2 lakh each drawn on ……………………….. Bank Ltd., …………………., New Delhi-110002.
5. That the First Party shall have no claim whatsoever against the Second Party after the receipt of the aforesaid amount from the Second Party.
6. That the Settlement has been arrived at between the parties on their own freewill without any force, fraud or coercion from anybody.
IN WITNESS WHEREOF the parties hereto have signed this Deed of Settlement on the day, month and year first above written.
WITNESSES:
1. Party of the FIRST PART
2. Party of the SECOND PART
New Page
RECEIPT
I, …………, Director, ………… Ltd., a company registered under the Companies Act, having its office at …………, ……………, …………, New Delhi, has received a sum of Rs.3,50,000/- (Rupees three lakhs fifty thousand only) as full and final payment of all the dues from Mr. …………, Proprietor M/s ……………… and Proprietor M/s …………….. having its office at …………, …………, …………, …………, New Delhi-110005 and in pursuance thereto, I have executed and signed a Deed of Settlement. The details of the payment is as under:
| S.NO. | PARTICULARS & DATE | CHEQUE / DD NO. | AMOUNT |
| 1. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (5.1.2023) | ………… | Rs.2,00,000/- |
| 2. | ……………., …………, New Delhi-110005 (6.1.2023) | ………… | Rs.1,00,000/- |
| 3. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.2.2023) | ………… | Rs.10,000/- |
| 4. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.3.2023) | ………… | Rs.15,000/- |
| 5. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.4.2023) | ………… | Rs.15,000/- |
| 6. | …………………………….. ………………………Ltd., …………, New Delhi-110002 (13.5.2023) | ………… | Rs.10,000/- |
| TOTAL | Rs.3,50,000/- |
(…………………….)
WITNESSES:
1.
2.