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Legal Order Law No (1) of 2017 stated that people with bounced cheques worth less than Dh200,000 will be required to pay a fine instead of serving imprisonment.Image Credit: Agency
Dubai: The value of cheques has come under scrutiny in the UAE, and businessmen say they would prefer cash as an alternative form of payment.
The debate of cash versus cheques was sparked after a prominent Emirati businessman took to Twitter to explain that cheques are no longer regarded as a secure way to receive payment.
Abdul Rahman Lootah commented that cheques have now lost their credibility “and it is no longer a major crime to issue a cheque without sufficient funds”. He also pointed out that the issuer of cheques no longer faces a jail term but will be penalized with a fine, which has inadvertently led to large number of bounced and dishonoured cheques reported in the emirate of Dubai.
In the case of bounced cheques, the complainant (drawee) can file a criminal case against the drawer.
Ashish Mehta, managing partner of Ashish Mehta and Associates, told Gulf News that cases of bounced cheques are usually referred to the criminal court, “but if the drawee files a civil claim memo in the first hearing of the criminal court proceedings, he can request the criminal court to also look into the civil claim.”
“Based on this, the criminal court may pass both orders in the criminal and civil claim, or may refer the civil claim made by the drawee to the civil court. On the other hand, the [complainant] is entitled to file a separate civil case if he intends to do so.”
However, drawers (writers) of cheques with non-sufficient funds (NSF) will not face imprisonment according to a 2017 law issued by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai.
