The banker is justified in dishonouring the customer’s cheques in the following cases :-

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1.  The signature of the drawer on the cheque does not match with the speciment signature in the records of the Bank.

2.  Funds are not properly applicable to the payment of cheque. For eg. Funds are subject to lien, or banker is entitled to set-off.

3.  Customer becomes insolvent.

4.  Death, lunacy  or insolvency of the customer and the banker has notice of the same.

5.  Cheque presented beyond a period of 6 months from the date of issue.

6.  If the banker is not holding sufficient funds of the drawer, unless the banker has agreed to honour the cheque without sufficient funds.

7.  If the customer countermands payment and communicates the same to the bank properly.

8.  Holder gives notice to the banker of loss of cheque.

9.  If the cheque is not presented within the usual banking hours.

10. Where the cheque is drawn on another branch office of the same bank where the customer does not have an account.

11. Where a garnishee order has been issued by the Court attaching customer’s balance.

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