Legal Question in Banking Law in India

I have given "self" cheque signed on both sides - front and back to my friend to withdraw in my absence (Bank of Maharashtra) but the bank refused to give cash on counter to him. they told a baseless reason dat the the account holder himself should be present at counter to encash. The story doesn't stops here. the branch manager telephoned me and told me not to issue self cheques in your absence. she (the br. manager) also told me to issue bearer cheque in the name of the person who wil encash it.

I argued with her. thereafter she allowed to giv cash to my friend bt on a instruction dat I should write behind the cheque dat " plz pay so and so person in my absence ".

was she on correct ground?

how can one withdraw large amount if has only single weekly holiday Sunday and same day bank too has?

plz reply!


Asked on 10/05/15, 11:35 am

2 Answers from Attorneys
Vivek Mapara Vivek N. Mapara

This is for your own safety. Bank Manager was responsible and no fault can be found with her. If, any such cheque of yours was stolen and if the bank manager had simply encashed the cheque, without informing you or taking such precautions, then you only be the looser, and at that time you would had asked the bank to take precaution which you are complaining today.

Please do not find fault with every procedure, which are for your own safety, merely because it causes some inconvenience.

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Answered on 10/05/15, 12:42 pm
Fca Prashant Chavan Expert Edge LLP

06.10.2015

Dear Sir / Madam.

Banks have been advised by the Reserve Bank of India (RBI) to follow strict KYC norms. So be it the drawer or the drawee of the cheque, the Bank has the inherent right to ask and insist on the particulars of the drawee say his / her photo ID etc. Secondly. you will be safeguarding your own interest if you write the name of the person whom you have authorized to go and withdraw money from your Bank instead of writing "Self" on the cheque, which is written whenever you personally visit the Bank to withdraw the money from your A/c, and not when you depute somebody else to go and withdraw cash from your A/c. Summing up, the Bank is right in instructing you to write the name of the Payee on the reverse of the cheque.

Regards.

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Answered on 10/05/15, 4:30 pm


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