A cheque is a bill of exchange drawn upon a specified banker and payable on demand. It is an unconditional order asking the bank to pay the specified amount of money to the person name with therein or to his order or to the bearer of the instrument. it is negotiable instrument. A cheque is considered convenient and safe mode of making payment. Thus one should how to properly fill up a cheque. There are basically two types of cheque book issued by bank
(i) Normal cheque Book: They are the old types of cheque book issued by bank. The payment for such cheque is payable on the same city where it is drawn. Bank have stopped issuing this outdated kind of cheque book leaves to its customer now.
(ii) Multicity cheque Book:Multicity cheque leaves are the most popular type of cheque prevalent nowdays. The good part of this cheque is that the payment for such cheque can be received in any corner of India no matter which city the cheque is drawn. Multicity cheque books have been replaced with normal cheque, which are now considered outdated cheque leaves by bank.
There are three parties of a cheque (i) drawer or account holder (ii) drawee or the bank, and (iii) payee to whom money is to be paid on demand. The drawer and payee can be the same person.
How to fill up a Cheque properly in easy steps
A Cheque basically contains some coloumns that the customer need to fill stating the following particulars. it is necessary for the customer to fill the cheque in the right manner to avoid cheque getting dishonoured. Therefore, we are providing you the narration of each and every coloumn so that the chances of mistake in the cheque is omitted. The column that the customer needs to fill are well described below:
Date: Here the Drawer of the cheque has to write the date when he is filling the cheque. If the drawer wants to give a post dated cheque he can write a future date. The payment for such cheque is made on the same date specified therein.
Name of the payee: Write the name of the party to whom you want to pay.
Amount table in words in figure: Write the amount of cheque in figure.
Amount in figure: Write the amount in figure.
Signature of the drawer: The cheque drawer should put his signature in this coloumn. The signature on the cheque should be his dedicated specimen signature, the signature he submitted to the bank at the time of account opening.
If you want the cheque amount to be credited in the payee account rather getting encashed from cash counter. In such case you can do crossing of cheque, where you need to draw two parallel lines across the left hand corner of the cheque with words, A/C payee only, such would prevent, it from encashed by an unknown person who finds that cheque. Learn more about Crossing of Cheque.