Cheque issued but not clear

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Ravi Kumar Rajgaria (Querist)
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12 May 2008 We have issued a cheque to a party for Rs. one lac in October, 2007.Till May, 2008 the cheque is not deposited and 6 months passed.What will be the accounting entries in books and when?Should any entry have to make in march, 2008 as per AS-4 etc.

Amit Sharma

Amit Sharma (Expert)
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12 May 2008 It should be treated as a stale cheque and a reversal entry will have to be passed.

KAUSTUBH M JOSHI

KAUSTUBH M JOSHI (Expert)
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12 May 2008 Since you have passed entry for payment in in Oct07. you should pass the reversal entry on date of expiry of validity pariod i.e. of six month.

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