Legal Question in Banking Law in India

A draft was issued as' Eng in chief, Bihar Patna' but payable at Patna(korea distt, Chattishgarh on 30.07.2016 wheras it should have been issued as ' Eng in chief, Phed, Bihar Patna' and payable at PatnaBihar.
This was submitted by Phed Bihar Patna but the branch returned it with the coment 'payees name is different in draft/ instrument from the presenting authority ' . Now the issuing branch has issued a certificate that it is due to their mistake that the the name of payee as well as paying branch has been wrongly printed therein. I want to know whether during these days when drafts are being printed electronocally, can it be valid to pay this draft making any correction in the draft as it is also an instrument under N I Act. What I undestand in this case a new draft be issued by cancelling the draft in question as mere a certificate does not alter the basic character of the draft. Pl enlighten me about this and if there is any specific guidelines for payment of drafts of similar nature as there is a specific guideline from RBI not to pay cheques after any alteration. Pl guide me as the matter is very urgent, shall be highly grateful.

Asked on 10/13/16, 8:33 am

Fca Prashant Chavan Expert Edge LLP

0 users found helpful

0 attorneys agreed

14.10.2016

Dear Sir / Madam,

No alterations or corrections are permitted in a cheque / DD as per RBI guidelines, A new draft has to be issued by the Bank.

Regards,

Answered on 10/13/16, 8:10 pm

Keywords

Match Any Match All

Country

State

Area of Law