What is a cheque under Negotiable Instruments Act?

The definition of cheque is an instrument, most commonly used means of making payments in the commercial and business world. It is defined under Section 6 of Negotiable Instruments Act as a bill of exchange, issued by the drawer to the banker. Cheque is issued with the purpose of guiding the banker to pay a certain sum of money when demanded by the specific person. A cheque is a tripartite transaction involving at least 3 parties one of them always being a bank.

A cheque can be crossed, open, post-dated, anti-dated, bearer or order cheque. A cheque needs to be duly signed by the drawer and the drawee must be certain to prevent misuse of such cheque.


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