Chapter VII - Of Discharge from Liability on Notes, Bills and Cheques
Section 89
Section 89: Payment where alteration is not apparent
Section 89 provides a payment discharge in the stated non-apparent-alteration or crossing setting and imposes exactness duties for truncated-cheque images.
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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
(1) Where a promissory note, bill of exchange or cheque has been materially altered but does not appear to have been so altered, or where a cheque is presented for payment which does not at the time of presentation appear to be crossed or to have had a crossing which has been obliterated, payment thereof by a person or banker liable to pay, and paying the same according to the apparent tenor thereof at the time of payment and otherwise in due course, shall discharge such person or banker from all liability thereon; and such payment shall not be questioned by reason of the instrument having been altered or the cheque crossed.
(2) Where the cheque is an electronic image of a truncated cheque, any difference in apparent tenor of such electronic image and the truncated cheque shall be a material alteration and it shall be the duty of the bank or the clearing house, as the case may be, to ensure the exactness of the apparent tenor of electronic image of the truncated cheque while truncating and transmitting the image.
(3) Any bank or a clearing house which receives a transmitted electronic image of a truncated cheque, shall verify from the party who transmitted the image to it, that the image so transmitted to it and received by it, is exactly the same.
Key rule and applicability
The payer must be liable to pay and pay according to the apparent tenor at payment and otherwise in due course. Subsections (2) and (3) separately treat an image–physical-cheque difference as material alteration and require the stated transmitting and receiving checks.
Limits and related provisions
This is not protection for ignoring an apparent alteration or paying outside the required standard. Keep the paying-person rule distinct from the bank or clearing-house duties to ensure and verify image exactness.
Hypothetical business example
Hypothetical: a receiving clearing participant obtains an electronic image of a truncated cheque. It documents verification with the transmitting party and checks exactness rather than assuming the image is reliable merely because it came through a banking channel.
Practical decision flow
Record what alteration or crossing was apparent when payment was made.
Assess liability to pay, apparent-tenor compliance and payment in due course.
For a truncated-cheque image, retain exactness and transmitter-verification evidence under subsections (2) and (3).
Practical checklist
Do
- Record what alteration or crossing was apparent when payment was made.
- Assess liability to pay, apparent-tenor compliance and payment in due course.
- For a truncated-cheque image, retain exactness and transmitter-verification evidence under subsections (2) and (3).
Avoid
- This is not protection for ignoring an apparent alteration or paying outside the required standard. Keep the paying-person rule distinct from the bank or clearing-house duties to ensure and verify image exactness.
Glossary
- Apparent tenor
- The instrument’s apparent terms relevant to the payment and image checks.
- Image exactness
- The required correspondence of the transmitted image and the truncated cheque.
Frequently asked questions
Does subsection (1) dispense with payment in due course?
No. It expressly retains that requirement.
What is a difference in apparent tenor between the image and physical truncated cheque?
Subsection (2) treats it as material alteration.
Does a receiving bank or clearing house have a verification duty?
Yes. Subsection (3) requires verification with the transmitting party that the transmitted and received image is exactly the same.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026