A cheque presented in a bank which is
unacceptable as per banking rules and regulations, considered as a Dishonoured
Cheque. A bank can rejects the cheque on any of the ground as mentioned below:
1. Not Enough Funds: The drawer should not issue any cheque containing the
amount more than the free balance amount available in his / her bank account.
The drawer could legally be prosecuted on this ground.
2. Uneven or Mismatched
Signature: The
cheque can be dishonoured in case of any mismatch of the signature of the
drawer with the specimen signature already available with the bank.
3. Modifications: The cheque can be dishonoured in case of any
modification or change done in the name of payee, amount in words or in the
figures or in date of issue. The drawer has to sign near or beside the modification
if any made in the cheque as self-verification.
4. Post Dated Cheque: A cheque presented before the date written on it is considered
as post dated cheque. The bank can dishonour a post dated cheque.
5. Out-of-date or a
Stale Cheque: A cheque presented after 3 months
from the date written on it is considered as out dated cheque which can be dishonoured
by the bank.
6. Frozen or Seized
Account: The bank can seize the account of an
account holder in case of statutory requirement or any government order if any.
In those circumstances, the bank will dishonour any of the cheque presented on
behalf of the same account holder.
7. Incomplete Cheque: If any information needs to be written on cheque which
is mandatory in nature if missing, then the cheque is considered as dishonoured.
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