Dishonour of cheques..

555 views

Save Share

Join Us Follow Us Add as Source

Athul

28 Points Posted on 02 May 2013

Respected Experts,

I will be thankful if you will be answer this question in common commercial practice , with legal implications..

Facts:

--'A' issues a post-dated cheque of 30000 to 'B' (dated 3rd may)

--On 3rd may, the drawer has only 31000 in his account as balance(of which 3k being minimum balance)

Can the Bank refuse this cheque on the grounds of insufficiency of funds?

I have seen some banks refuse it, while others dont, they honor it. So, what exactly is the correct legal positon in this regard?

Thanks!

Replies (2)

Guest

Posted on 02 May 2013

1. The bank Can not refuse the same becouse there is Sufficient balance on that day. the bank should have to houner the cheque.

2. The bank will lavy the minimum balance charges for the same .

P C Agrawal

Registered independent director Past Ch

5233 Points Posted on 21 May 2013

Yes, Bank cannot refuse to pass the cheque since sufficient balance is there in the account. If the Bank ensures that minimum balance is maintained by returning the cheques unpaid in such cases, there would have been no question for providing for charges for not maintaining minimum balance since there would be no situation when minimum balance is not maintained.