RBI on Friday announced that all the 18,000-odd branches which are outside the centralised clearing system called cheque truncation system will come under it by September. This is decision is taken by Central Bank as part of further improving, speeding up, and fool-proofing the payments and settlement systems, it said. The Cheque Truncation System (CTS)…
The Negotiable Instruments (Amendment) Act, 2018 (Amendment) received the assent of the President on 2nd August 2018. Sec 143 A & 148 which have been now inserted in the NI acts is in addition to Section 138 of the NI acts which deals in cheque bounce cases. Equipped with the newly inserted sections to NI…
Section 8 of NI act provides that holder is any person who is entitled in his own name to the possession of negotiable instrument and has right to receive or recover the amount from the parties thereto.The word ‘entitled’ means that the person who claims to be holder should acquire the instrument in a lawful…
(This post explains Legal amount and courtesy amount,Effect of date written in Saka samvat,Cheques written in Regional Language, meaning of e-cheque.) A cheque has three principal parties viz. Drawer; Drawee and Payee. The drawer is the person who issues (draws) the cheque. The drawee is the paying bank whose name and address is printed on…
A cheque signed by a drawer of cheque without completing the material particulars such as date, amount or name of the payee, it is known as an inchoate or incomplete cheque. When the drawer of a cheque hands over an inchoate cheque to a payee, prima facie he has given authority to the payee to…
Any alteration in the original state of a cheque such as date, amount, payee’s name, changing the word ‘order’ to bearer appearing after payee’s name or in endorsement is called material alteration. All material alteration must have drawer’s approval with his full signature (not initials) where the alterations are made. One of the mandatory features of…
Writing a cheque seems to be a simple task, but remember, issuing a cheque to a person is equivalent to payment of cash and we find frauds related to cheque are very common. Therefore, no need to mention that writing a cheque in right way is crucial to avoid misuse or dishonor of cheque issued…
A Cheque is a specially printed paper form issued by the banks to their customers to draw money or pay monies to third parties from their running account like SB/Current Account, Cash Credit Account etc. that contains following features. When you look at a cheque, you find the name of the bank and address of…
The bills of exchange are a kind of negotiable instruments generally arising out of trade transactions. Demand bills, Usance bills, Clean bills, Documentary Bills, Accommodation bills, etc. are the examples of bills of exchange in usage for different types of trade transactions. A cheque is also a kind of bill of exchange. However, cheque has some…
Section 5 of the NI Acts 1881 defines a bill of exchange as under “A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money to, or to the order of, a certain person or the bearer…