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WHAT ARE THE DIFFERENT TYPE OF

CHEQUES ISSUED IN INDIAFinance

Cheque is a document which guarantees the payee or bearer to get paid for a specific

amount from the payers bank account. Your bank on demand from payee or bearer

pays the specified amount after cross checking your signature with banks database.

After opening your saving bank account or current account, you will be issued a

bunch of Cheque leaf. These leafs can be used for making payment to your vendor or

to pay your bills. There are different type of cheques which are defined based on how

you issue it, where as basic format remains same. In this article we will be discussing

6 verities of cheques that are issued in India.

Bearer Cheque

On your Cheque leaf you can find a

word Or Bearer. If you do not

strike out this word while issuing

then it becomes a bearer Cheque.

Bearer Cheque means the person

who is holding the instrument can

withdraw amount from your bank

account. Issuing these types of Cheque is risky as you never know when your payee

will misplace it. In such type of circumstances the finder can collect the payment from

bank.

Crossed

Crossing a Cheque means you are instructing the bank to make payment to the

payees banks account only. You can cross it by adding two parallel lines on the top

left hand corner of the Cheque. Payment for this type of Cheque can not be obtained

from the cash counter of your bank account. After depositing it with a bank, the bank

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will submit it to the nearest branch of payers bank and then you will be paid after

getting it paid from payers bank to your bank. You can also write A/c Payee in

between the crossed line.

Uncrossed

While issuing if you do not cross the Cheque then it will be called Uncrossed Cheque.

Its also called open Cheque which is not required to be paid to payees bank

account.

Self

In self cheque, you can issue it in your own name or write self in the palace of writing

Payees name. The person who is holding the instrument can go to the payers bank

and withdraw the amount that is mentioned there in. Its a very risky instrument as the

owner has not been defined in it. In case you misplace it, then the other party holding

the instrument can claim his ownership. In such types of situation, you have to inform

the bank and payer to block it by giving the cheque number to them. This type if

instrument can only be paid by payers bank. You cannot get it paid from any other

banks.

Order Cheque

In case of order Cheque, the payee in whose favor the Cheque has been issued can

only withdraw the amount. If the payee wants then he or she can authorize someone

to collect the amount on his behalf. It will become an order cheque only when you

strike out the word OR BEARER part after writing the party name in it and have

not crossed it on the top left hand corner.

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Post-dated

A cheque issued today will be valid for 3 months from the date of issue. In case

someone wants to take payment on a future date i.e. after 3 months time period or

the party has requested to have a higher validity period then you can issue a post

dated cheque by quoting a future date as per your convenience. In such type of

situations, it will be valid for 3 months from the future date that is mentioned on the

instrument. For example; on 16/12/2013, if you are issuing it dated 01.04.2014 then

it will be called a posted dated cheque and will be valid for 3 months from the date of

01.04.2014.

Cheque will change its functionality based on how its issued. You have to be very

careful while drafting a cheque or else there are chances of losing your hard earned

money.

Also Read: 5 things to remember while filling out a cheque

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Last Updated on March 29, 2014 by Editorial Staff

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