Chapter XIV - Of Crossed Cheques
Section 129
Section 129: Payment of crossed cheque out of due course
Section 129 imposes liability to the true owner for loss caused by paying a crossed cheque through a prohibited route.
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Need advice on Section 129?
This article is for general information. Refer to the Negotiable Instruments Act, 1881 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
Any banker paying a cheque crossed generally otherwise than to a banker, or a cheque crossed specially otherwise than to the banker to whom the same is crossed, or his agent for collection, being a banker, shall be liable to the true owner of the cheque for any loss he may sustain owing to the cheque having been so paid.
Applicability and limits
The rule covers general crossings paid otherwise than to a banker and special crossings paid otherwise than to the named banker or its collection-agent banker.
The loss must arise from the cheque having been paid in that manner. The section does not fix an automatic penalty sum independent of the true owner’s loss.
Hypothetical example
Hypothetical: a specially crossed cheque is paid to an unrelated recipient instead of the named banker or its collection-agent banker, causing the true owner a loss. Section 129 addresses that paying banker’s liability.
Evidence and decision flow
Retain the original crossing and the actual payment-recipient trail.
Identify the true owner and the relevant prohibited payment route.
Document the loss and how that payment route caused it.
Practical checklist
Do
- Retain the original crossing and the actual payment-recipient trail.
- Identify the true owner and the relevant prohibited payment route.
- Document the loss and how that payment route caused it.
Avoid
- The loss must arise from the cheque having been paid in that manner. The section does not fix an automatic penalty sum independent of the true owner’s loss.
Glossary
- Paying banker
- The banker making the payment described in the provision.
- Causal loss
- Loss sustained owing to the cheque having been paid in the prohibited manner.
Frequently asked questions
Who is entitled to the stated remedy?
The true owner of the cheque.
Does the text set a fixed fine?
No. It speaks of liability for loss sustained owing to the payment.
Can a collection agent qualify in a special crossing?
The text allows the named banker’s agent for collection, being a banker.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026