MEANING OF MARKING OF CHEQUE AND CROSSING OF CHEQUE

Ø  MEANING OF MARKING OF CHEQUE AND CROSSING OF CHEQUE
BUSINESS LAW II NEGOTIABLE INSTRUMENTS ACT 1881

Ø  SHASHI AGGARWAL ECONOMICS AND LAW CLASSES

Ø  MEANING

  SECTION 6 OF THE NEGOTIABLE INSTRUMENT ACT:-

1.       A CHEQUE OR A BILL OF EXCHANGE DRAWN ON A SPECIFIED BANKER

2.       AND NOT EXPRESSED TO BE PAYABLE OTHERWISE THAN ON DEMAND

3.       AND IT INCLUDES THE ELECTRONIC IMAGE OF TRUNCATED CHEQUE AND A CHEQUE IN THE ELECTRONIC IMAGE

Ø  MARKING OF THE CHEQUE

1.       MARKING IS THE WRITING ON A CHEQUE BY THE DRAWEE BANKER THAT IT WOULD BE HONORED WHEN IT IS DULY PRESENTED FOR PAYMENT.

2.       IT DOES NOT AMOUNT TO ACCEPTANCE

3.       THE EFFECT OF MARKING OF CHEQUE AS GOOD BY THE DRAWEE BANKER THAT IT  IS CAN NOT COUNTERMANDED BY THE DRAWER SUBSEQUENTLY AND THE PAYEE IS CERTAIN OF GETTING THE MONEY.

4.       CHEQUE MAY BE MARKED AT THE INSTANCE OF:-

1.       DRAWER:-THEN DRAWEE BANKER EARMARKS SUFFICIENT FUNDS IN THE ACCOUNT TO MEET THE CHEQUE WHEN IT WILL BE BE PRESENTED FOR PAYMENT

2.       MARKING AT THE INSTANCE OF HOLDER:-BANKER HAS SUFFICIENT FUNDS OF DRAWER IN HIS HANDS BUT BANKER CAN REFUSE PAYMENT IF THE DRAWER HAS WITHDRAWN THE AMOUNT

3.       MARKING AS COLLECTING BANKER’S INSTANCE:-CONSTRUCTIVE PAYMENT

  CROSSINGS OF CHEQUE

1.       CROSSING IS DIRECTION TO THE DRAWEE BANKER TO PAY THE AMOUNT OF MONEY ON CROSSED CHEQUE GENERALLY TO A BANKER OR

2.       PROVIDES PROTECTION AND SAFEGUARD TO THE OWNER

3.       A CROSSED CHEQUE IS ONE WHICH TWO PARALLEL TRANSVERSE LINE WITH OR WITHOUT THE WORDS & CO ARE DRAWN

4.       BUT IT DOES NOT EFFECT NEGOTIABILITY OR TRANSFER ABILITY BUT WHERE THE WORD ARE NOT NEGOTIABLE THEN IT IS NOT NEGOTIABLE

  MODES OF CROSSING

1.       GENERAL CROSSINGS

2.       SPECIAL CROSSINGS

  GENERAL CROSSING

1.       GENERAL CROSSINGS: TWO TRANSVERSE LINES MUST BE DRAWN ON THE FACE OF CHEQUE AND

2.        IT MAY CONTAIN THE WORDS” AND COMPANY OR & CO OR WITH NOT NEGOTIABLE OR NOT NEGOTIABLE &CO

3.       WITHOUT ANY WORD

4.       WHERE A CHEQUE IS CROSSED GENERALLY,THE DRAWEE BANK SHALL NOT PAY IT UNLESS IT IS PRESENTED BY A BANKER

GENERAL CROSSING

   

  D

  SPECIAL CROSSING

  WHERE A CHEQUE IS CROSSED SPECIALLY THE BANKER ON WHOM IT IS DRAWN SHALL PAY IT ONLY TO THE BANKER ON WHOM IT IS CROSSED OR HIS AGENT FOR COLLECTION

  WHERE  A CHEQUE BEARS ACROSS THE FACE NAME OF THE BANKER TO BE ADDED WITH OR WITHOUT NOT NEGOTIABLE. THE CHEQUE IS CROSSED SPECIALLY. TRANSVERSE LINES ARE NOT NECESSARY.

  THE PAYMENT OF  SPECIAL CROSSED CHEQUE CAN BE OBTAINED THROUGH THE PARTICULAR BANKER WHOSE NAME APPEARS ACROSS THE FACE OF THE CHEQUE OR BETWEEN THE TRANSVERSE LINES.

   .

  SPECIAL CROSSING

   

  STATE BANK OF INDIA

  RESTRICTIVE CROSSING

  WHICH HAS BEEN ADOPTED BY COMMERCIAL AND BANKING USAGE

  IN THIS TYPE OF CROSSING A/C PAYEE ARE ADDED TO THE GENERAL OR SPECIAL CROSSING

  RESTRICTING THE PAYMENT IN CERTAIN WAY.

  ADDING THE WORDS ACCOUNT PAYEE ONLY OR PAYEE ACCOUNT ONLY

  A/C PAYEE ON A CHEQUE IS DIRECTION TO THE COLLECTING BANKER THAT AMOUNT COLLECTED ON THE CHEQUE IS TO BE CREDITED TO THE ACCOUNT OF PAYEE.

  RESTRICTIVE CROSSING

  NOT NEGOTIABLE CROSSING

  THE EFFECT OF THE WORDS NOT NEGOTIABILITY ON A CROSSED CHEQUE IS THAT THE TILTLE OF THE TRANSFEREE OF SUCH A CHEQUE CAN NOT BE BETTER THAN THAT OF TRANSFER OR.

  THE ADDITION OF THE WORD NOT NEGOTIABLE DOES NOT RESTRICT THE FURTHER TRANSFER ABILITY OF A CHEQUE.. IT ONLY TAKES AWAY THE MAIN FEATURE OF NEGOTIABILITY WHICH IS THAT A HOLDER WITH A DEFECTIVE TITLE CAN A GIVE A GOOD TITLE TO A SUBSEQUENT HOLDER IN DUE COURSE.

  WILSON & MESSON
W DREW A CHEQUE CROSSED “ NOT NEGOTIABLE IN THE BLANK AND HANDED IT TO CLERK TO FILL THE NAME OF THE PAYEE AND THE AMOUNT. THE CLERK INSERTED A SUM IN EXCESS OF HIS AUTHORITY AND DELIVERED THE CHEQUE TO P IN THE PAYMENT OF THE DEBT. HELD AS THE CLERK HAS NO TITLE TO THE CHEQUE AND SO THE P. W WAS NOT LIABLE.

  WHO CAN CROSS THE CHEQUE

1.       THE DRAWER

2.       HOLDER

3.       BANKER