What is cheque?
Cheque: cheque is a negotiable instruments that instruct a bank to pay a specific amount from a specific account held in the depositor name with that bank. Validity 3 months applicable from 1st April 2012 .
There are three parties to a cheque- Drawer, Drawee and Payee.
Drawer: Who draws cheque, Drawer can be customer or account holder.
Drawee: For Whom the cheque is Drawn, it is also called paying banker.
Payee: Payee is the person to Whom the amount stated in the cheque is payable. It may be drawer himself or only the third party that States in the cheque.
Types of cheque-
(i) Order cheque: only for particular person.
(ii) Bearer Cheque: it is payable everyone Whomsoever bears.
(iii) Blank cheque: when only sign mentioned all columns leave blank.
(iv) Stale cheque: when the cheque is more than three months old.
(v) Mutilated cheque: if the cheque is torn into two or three fold.
(vi) Post dated cheque: if a cheque contain a date later than the date of issue.
(vii) Crossed Cheque: the cheque which is crossed by parallel transverse lines across the face of the cheque with or without words.
(viii) Open cheque: The cheque Which is not crossed.
(ix) Gift cheques: issued for occasions like wedding, birthday etc.
(x) Traveler cheque: issued by a bank remittance of money from one place to another place.