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i. Drawer Payee
A drawer is the person who signs on the
cheque. He/she is also known as the depositor Drawee
or cheque maker. A person holding A/c with a
bank is the drawer.
Drawer
ii. Drawee
A drawee is the party on whom the cheque is drawn. Thus, a drawee refers to the
bank, which encashes the cheque when it is valid and authentic.

iii. Payee
If a payee is the receiver of the amount mentioned in the cheque, sometimes, the
drawer himself may be the payee. If he writes his own name or the word `self’ in the
cheque and presents it in the bank counter, otherwise the order of a person or the bearer
of the cheque can be the payee.

Points to Remember
i. Drawer ii. Drawee iii. Payee

16. Rulings of a Cheque

There are certain rules to fill up a cheque. If the drawer fails to follow any of these
rules, the bank may dishonour the cheque i.e. may not encash the cheque.

i. Date
The date, on which the cheque is drawn, should be clearly mentioned. The mentioning
of future date makes a cheque invalid.

ii. Name
The name of the person to whom the cheque’s amount is to be paid should be clearly
mentioned. Otherwise, the cheque may be invalid. If the drawer himself wants to receive
the amount, he writes his name or the word ‘self’ in the name blank in the cheque,
otherwise he writes the name of his order.
iii. Amount
The amount for which the cheque is drawn should be clearly mentioned in words
as well as in numerals. The amount mentioned in the cheque must not be more than the
deposit balance remained with the bank in that A/c.

iv. Account Number
Each depositor will have a separate account number for his/her deposit. Sometimes
if a depositor has different accounts within the same bank and the account number will
be different regarding the accounts. The respective and relevant account number should
be mentioned in the cheque.

Financial Institutions
78 Aakar’s Office Practice and Accountancy - 10 Office And Office Personnel 79 79