A cheque is draft drawn upon a bank payable on demand signed by the maker or drawer, containing an unconditional promise to pay a sum certain in money to the order of tha payee.Negotiable instrument lays down those cases in which a banker is justified in dishonoring a cheque and in which a bank is bound to dishonor the cheque.
Following are those circumstances in which a banker is justified in dishonoring a cheque:
Post-Date Cheque
Insufficient Balance
Funds set aside for Special purpose
Difference in words and figures
Where the banker has lien
Sealing of account
Forgery of Drawer’s signature
Cheque not presented within reasonable time
Violation of rules and regulations
Closing of Customer’s account
Where the customer has no account