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counter of the bank. As per Section 127 of The Negotiable Instruments Act, 1881: Where a cheque is crossed specially to more than one banker except when crossed to an agent for the purpose of collection, the banker on whom it is drawn shall refuse payment thereof.. A crossing is an instruction or a direction given to paying banker to pay the amount of the cheque through a banker only or a particular banker as the case may be and not directly to the person presenting it at the counter. Drawer: The person writing the cheque is known as adrawer. A crossed cheque is also safer because it can be cashed only at the payees bank. In the country of India, a particular cheque is only valid for up to a period of 3 months since it is issued. A stale cheque has already passed its validity date and can no longer be cashed. The cheque which is payable to the bearer or It can only be cashed after the date specified by the payer. General crossing on a cheque can be made by inserting two parallel lines on the left-hand top corner Special Crossing. Crossing cheques can be important these days as such actions protect the document from people with malicious intent. b) Bearer cheque can be converted into WebWhen a cheque is crossed in this way, it is called a general crossing. Thus, a crossing is necessary in order to have a safety. If any cheque contains such an

(A) OPEN CHEQUE - It is an uncrossed cheque which is payable at counter of the bank. They are: 1. The specified person i.e. Bearer cheque: The cheque which is payable to the bearer or with or without the words and company or not negotiable or account payee Crossing cheques are essentially cheques that have been marked with specific instructions for their redeemin Ans. Crossing of Cheques can be done in two ways: General Crossing Special Crossing You can click on this link and join: Follow us onInstagramand subscribe to ourYouTubechannel for more amazing legal content. A negotiable instrument payable otherwise than to a bearer can be negotiated only by endorsement and delivery. where payment will be made only to Ram or to the person to whom Ram has the endorsee then becomes the payee of the instrument. by the drawer of the cheque. WebAn open cheque is basically an uncrossed cheque. Given below is the list of the various cheque types: Bearer Cheque Order Cheque Crossed Cheque Account Payee Cheque Stale Cheque Post Dated Cheque Ante Dated Cheque Self Cheque Travelers Cheque Mutilated Cheque Blank Cheque Restrictive Crossing : When in between the two transverse parallel lines, the words A/c payee is written across the face of the cheque, then such a crossing is called restrictive crossing or 5. vi. It can be Bearer Cheque or Order Cheque . Section 123 to 131 of the Negotiable Instrument Act contain provisions relating to the crossing. Students ofLawsikho coursesregularly produce writing assignments and work on practical exercises as a part of their coursework and develop themselves in real-life practical skills. The paying banker is not authorized to send the proceeds of a crossed cheque to the payer or the cheque holder. Hence, it is not instantly encashed by the holder presenting the cheque at the bank counter. Your email address will not be published. Mumbai University B.Com - MCQs, Exam MCQs and Solved Papers, Auditing MCQs Multiple Choice Questions and Answers | Auditing MCQs For B.Com, CA, CS and CMA Exams, Management Accounting MCQs [Multiple Choice Questions and Answers], MCQ On Budget and Budgetary Control | Multiple Choice Questions and Answers, MCQ on Accounts of Holding Companies [Multiple Choice Questions and Answers], Corporate Accounting Multiple Choice Questions and Answers (MCQs) | Company Accounts MCQs. But order cheque cannot be converted into bearer cheque. 2023 All Right Reserved Oliveboard Pvt. WebAn open cheque is basically an uncrossed cheque. c) Features of Special Crossing: The example is "State Bank of India". The word endorsement is said to have been derived from Latin en means upon and dorsum meaning the back. Ans. 50 of the NI Act 1881states. The or bearer mark on the cheque is struck off in order for cheques to ensure only the payee receives the amount specified in the cheque. Such cheques indicate that the amount mentioned in the cheques can only be paid into the specified bank account which is mentioned in the cheque itself. Ans. Get all the important information related to the Bank Exam including the process of application, important calendar dates, eligibility criteria, exam centers etc. bearer cheque as it is transferred without endorsement.

A stale cheque is a cheque that is not valid anymore or has expired. Open Cheques: In case of open cheques, the amount of such cheques can be collected by the payee over the counter of the bank. Such cheque runs great risk in the course of circulation because once a wrong person takes away the Section 124 of The Negotiable Instruments Act, 1881 defines Special Crossing as: Where a cheque bears across its face an addition of the name of a banker, either with or without the words not negotiable, that in addition shall be deemed a crossing, and the cheque shall be deemed to be crossed specially and to be crossed to that banker., A specimen of SpecialCrossing of Cheques. 129 of the Negotiable Instrument Act. This cheque can be encashed at any bank, and the payment can be made to the person bearing the cheque. Crossed cheques must be presented through the bank only because they are not paid at the counter. Below given are different types of crossed cheque: General Crossing Under General Crossing, two transverse parallel lines are crossed across the face of the cheque and it bears an abbreviation & Co. between the two parallel lines. WebWhen a cheque is crossed in this way, it is called a general crossing. 4. But crossed cheque is not used by the drawer to There are mainly ten types of cheques in India that you should know about. TYPES OF CHEQUES. Different Types of Crossing (i) General Crossing. But an order cheque is payable to the Act 1881, In this type of crossing the cheque must contain two transvers parallel line across the face of the cheque with or without word like & Co. Account Payee or Not Negotiable. collect the amount of the cheque. 125 of the Negotiable Instruments Act, Section 124 of The Negotiable Instruments Act, 1881, Sec. It is used by the issuer to withdraw money from their bank account. In General Crossing paying banker to honor the cheque from any bank A/C. Issued by a bank, a travellers cheque can be cashed by the payee at another bank in another country. 2. Open cheque does not require any payment of such cheque. There are mainly ten types of cheques in India that you should know about. The ten types of cheques include: A bearer cheque is the type of cheque that allows the person bearing or carrying the cheque to the bank to receive the payment specified on the cheque. endorsement and the paying banker takes reasonable care before making the 2. a) The same does not lead to a reduction in the cheque s negotiability or transferability. more delivery of cheque. d) ii.The Cheque ceases to be negotiable further. Such cheque can be transferred by An endorsement, according to sec.

Club, School, College and other Non Trading Organizations: Signed by authorized person. There are also substantial differences between the special and general crossing of cheques. Restrictive crossing. a) Meaning: Section 123 A(i) When a cheque crossed generally bears across its face an addition of words Account Payee between the two parallel transverse lines constituting the general crossing, the cheque besides being crossed generally is said to be crossed account payee. There are various types of cheques and these are described in the following sections. c) Transactions through Cheques are quite common these days. WebA crossing of a cheque means Drawing Two Parallel Lines across the face of the cheque. Unlike other crossing it deprives the instrument of the incident of negotiability. The crossing of cheque had developed gradually as a means of protection against misusing of cheques. General crossing on a cheque can be made by inserting two parallel lines on the left-hand top corner Special Crossing. A per section 123 of N. I. While making such transactions, you might have come across the crossedcheques. money to the specified person only by transferring the money to his account and Types of Cheque Crossing General Crossing cheque bears across its face an addition of 2 parallel crosswise lines. A common instruction is for the cheque to be deposited directly to an account with a bank and not to be immediately cashed by the holder over the bank counter. Open cheque is payable across the What Is A Cryptocurrency Hardware Wallet? Endorsement in full or special endorsement. WebCrossing of Cheques | Types of Crossing of Cheque| Crossing and it's types | CA Inter. Act, 1881 endorsement may take any of the following forms: In case of an endorsement in blank, the payee or endorser does not specify an endorsee and he simply signs his name (S. 16 NIA). Itis a document that orders a bank to pay a specific amount of money from a persons account to the person in whose name the cheque has been issued. Open cheque may be a bearer or order That is all from us in this blog. Therefore, only a banker is allowed to receive a crossed cheque. Related link: Crossing of Cheques can be done in two ways: Section 123 of The Negotiable Instruments Act, 1881 defines General Crossing as: Where a cheque bears across its face an addition of the words and company or any abbreviation thereof, between two parallel transverse lines, or of two parallel transverse lines simply, either with or without the words not negotiable, that addition shall be deemed a crossing, and the cheque shall be deemed to be crossed generally. Sec. person (whose name appears on the cheque) or to his order, is called the order

Enter any details such as A/c payee or Not Negotiable or as the case may be. cheque. by the drawer of the cheque. (adsbygoogle = window.adsbygoogle || []).push({}); Statutory Protection to Collecting Banker-www.bankingallinfo.com, Agent Banking in South-east Asia (Bangladesh), Cheque Types-Crossing of cheque and Endorsement, Cheque Types-Crossing of cheque and Endorsement-www.bankingallinfo.com, Difference between General and Special Crossing, Section 123 to 131 of Negotiable Instrument Act, Special Features of Not Negotiable Crossing, Clearing House -Function, Procedure & Accounting, Integration of Human Resource in Strategic Decision , Technique to collect foreign remittance from abroad, Top 25 core banking software companies in the world, Importance of foreign Inward remittance of a country, Banking Technology Trends all over the world, Banking News Headlines all over the globe. As per section-127, where a cheque is crossed specially to more than one banker except when crossed to an agent for the purpose of collection, the banker on whom it is drawn shall refuse payment thereof. Prof. Evneet's COMMERCE CLASSES. In this post we have learnt about the different kinds of cheques which exist in our banking system and also the different types of crossing of cheques and their respective indications. Hence, it protects both the parties. The person to whom the instrument is endorsed is called the endorsee. bearer cheque, where Ram or any other person who possess the cheque, can A cheque can be crossed by the-, 2. An open cheque is payable at the counter of the drawee bank on the presentation of cheque. Inclusion of the name of a banker is essential. iii.The collecting banker is duly bound to collect the proceeds of the cheque in the account of the Payee only.

Agent: While signing a negotiable instrument only as an agent of another, he should make clear by adding the words Per Procuration, Per Pro, For, For and on behalf of, On behalf of. These cheques by any unauthorized person. This essentially means that the individual who is carrying the bearer cheque to the bank has all the authority to encash it at the same institution.

Unacademy is Indias largest online learning platform. It has often been observed that both non- negotiable crossing and crossing of accounts payee help to ensure that cheques are extremely secure.

Currently, a cheque is considered valid until three months from its issued date. Method of restricting redemption of cheques, The examples and perspective in this article, Consequence of a bank not complying with the crossing, Learn how and when to remove this template message, http://www.legislation.gov.uk/ukpga/1992/32/section/4, http://www.chequeandcredit.co.uk/information-hub/faqs/crossed-cheques, https://en.wikipedia.org/w/index.php?title=Crossing_of_cheques&oldid=1140076227, Short description is different from Wikidata, Articles with limited geographic scope from March 2021, Articles needing cleanup from February 2011, Cleanup tagged articles without a reason field from February 2011, Wikipedia pages needing cleanup from February 2011, Wikipedia articles needing clarification from January 2023, Articles with unsourced statements from October 2016, Articles with unsourced statements from February 2022, Creative Commons Attribution-ShareAlike License 3.0, This page was last edited on 18 February 2023, at 08:40.

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