CHEQUE

CHEQUE
Section B of the Act defines a cheque as, ‘’A bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand.’’ A cheque is a bill of exchange but a bill of exchange often is not a cheque. A cheque is always payable on demand. The person drawing or making the cheque must be a customer of the bank and must be having the required find as deposit with the bank.
PARTIES TO A CHEQUE
The parties to a cheque are
Drawer He is the maker of the cheque. He must be the holder of the account at the bank and must sign the cheque as per specimen signature.
Drawee He is the banker with whom the A/C is maintained by the drawer of the cheque.
Payee He is a person named in the cheque to whom or to whose order the payment is to be made.
ESSENTIALS OF A CHEQUE
A cheque must have the following features / essentials.
i. It must be in writing but should not be written by a pencil.
ii. It must be an unconditional order to pay. The drawer must not pay any condition for the payment of cheque.
iii. It must be signed by the person giving it.
iv. Cheque must be drawn upon a banker not else.
v. It must be for the payment of a certain sum of money only.
vi. Amount of money must be written in figures and words.
vii. The cheque must be payable on demand

TYPES / KINDS OF A CHEQUE
Cheque may be of different types. Some of them are
Order Cheque
Order Cheque is a which is expressed to be so payable or which is expressed to be payable to a particular person without containing words prohibiting transfer or indicating that it will not be transferable.
Open Cheque
They are payable in cash at the counter of the banks to the bearer of the cheque.
Crossed Cheque
These type of cheques are not encashed at the counter but which can be collected only by a bank from the drawer bank. But these days an individual can also draw a crossed cheque for the purpose of safety and security in certain cases.
Bearer Cheque
A bearer cheque is that which can be cashed for the bank by the bearer of the cheque. Any person who is in possession of a bearer cheque can cash it without any difficulty