Under section 138 of the Negotiable Instruments Act, 1881, the maximum punishment prescribed is

Option A: Imprisonment upto One year and fine upto the amount of cheque

Option B: Imprisonment upto Two years and fine upto the amount of cheque

Option C: Imprisonment upto Two years and fine upto the twice the amount of cheque

Option D: None of the above

Correct Answer

Option: c

Explanation

Section 138 provides that when the cheque is dishonored for insufficiency of funds or for any of the prescribed reasons, the one who is at defaulter can be punished with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the cheque, or both.

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