CROSSING OF CHEQUES

A crossed cheque is one on which two parallel transverse

lines with or without words ‘& Co.’ are drawn.

The payment of such cheque can be obtained only

through a banker.

Thus crossing is a direction to the drawee banker to pay

the amount of money on a crossed cheque generally to a
banker so that the party who obtains the payment can be
easily traced.
 TYPES OF CROSSING

• There are two types of crossing

(1) General crossing, and
(2) Special crossing.

• Another type of crossing known as ‘restrictive

crossing’ has developed out of business usage.
 (1) GENERAL CROSSING

• A cheque is said to be crossed generally when it

bears across its face an addition of –
(i) The words ‘& Co.’ between two parallel transverse
lines, either with or without words ‘not
negotiable’; or,
(ii) Two parallel transverse lines simply, either with or
without the words ‘not negotiable’ (Sec. 123 of
Negotiable Instruments Act, 1881).
• When a cheque is crossed generally, the drawee
banker shall not pay it, unless it is presented by a
banker (Sec 126, Para 1, Negotiable Instruments
Act, 1881).
 SPECIAL CROSSING
• When a cheque bears across its face an addition of the
name of a banker, either with or without the words ‘not
negotiable’, the cheque is Deemed to be crossed
specially
(Sec. 124 of the Negotiable Instruments Act, 1881).
• Transverse lines are not necessary in case of a special
crossing.
• The payment of a specially crossed cheque can be
obtained only through the particular banker whose
name appears across the face of the cheque or
between the transverse lines, if any.
 RESTRICTIVE CROSSING
• In addition to the two statutory types of crossing discussed above, there is
another type which has been adopted by commercial and banking usage.

• In this type of crossing the words ‘A/c Payee’ are added to the general or
special crossing.

• The words ‘A/c Payee’ on a cheque are a direction to the collecting banker
that the amount collected on the cheque is to be credited to the account
of the payee.

• If he credits the proceeds to a different account, he is guilty of negligence

and will be liable to the true owner for the amount of the cheque. It should
however be noted that ‘A/c Payee’ cheques are negotiable.