In that case, cheque is called a bearer cheque. Payment can also be made to any person who bears and presents the cheque. Crossed cheque has to be first deposited in the bank account of the account-holder in whose favour cheque is drawn and only through his account, payment can be withdrawn. Payment against crossed cheque cannot be received simply by producing the cheque. In that case, cheque becomes a crossed cheque. Sometimes the words ‘& Co’, ‘A/C Payee Only’, ‘Not Negotiable’ or ‘Name of the Bank’ is written within these lines. To avoid any fraud, cheques are crossed by drawing two parallel transverse lines across the cheque. In this case cheque is called an order cheque. Through cheques, payment can be made to a specific person by writing the name of the party after the words ‘Pay’ and by striking off the word ‘bearer’ with a line printed on the cheque.
Need to type a document code#
Digits mentioned on the bottom of the cheques denote code of ‘State’, ‘Bank’, ‘Branch’, ‘Cheque’ and ‘Type of Account’ respectively. The bank issues a booklet containing cheque forms to its account holders. Negotiable Instruments Act, 1881Ī cheque is an instrument drawn upon a banker and payable on demand. The counterfoil of the pay in slip becomes a source document, which acts as an evidence for the customer to record this transaction in the books of accounts.Ī cheque in an unconditional order, drawn upon a specified hanker, signed by the maker, directing the banker to pay on demand a certain sum of money only to the order of a person or the bearer of the instrument. Usually, the large business enterprises obtain the complete bunch of pay-in-slips and get them all bound in a book. The bank clerk signs, stamps the counterfoil of the pay in slip and returns it to the depositor. When a depositor deposits money in the bank account, he fills up a form provided by the bank containing the information about the date, amount to be deposited and the name of the depositor etc. This document serves the purpose of providing an evidence that on particular date, a specific amount has been deposited in the bank. A specimen of the receipt is given below: