The other valid reasons for a cheque dishonour is that the account on which the cheque has been issued is closed or a 'stop payment instruction' has been given by the drawer of the cheque to the bank.
Bank will dishonour the cheque and return it unpaid as bank can not honour it before the date mentioned on cheque instrument out-dated / stale cheque – a cheque is valid for three months from the date written on cheque.
6frozen account: if court orders or a military government decrees that some people's account be frozen, the bank must definitely dishonour all checks bearing the account's numbers 7when there is attention: if anything is cancelled on a check, the bank will dishonour such a check, except the drawer signs his signature above or under the altered word. Reasons for dishonour of cheque if the cheque is overwritten if the signature is absent or the signature in the cheque does not match with the specimen signature kept by the bank if the name of the payee is absent or not clearly written if the amount written in words and figures does not match with each other.
This lesson gives us the list of reasons for return of cheques when a cheque is returned the bank gives you a reason why the cheque failed to clear we would need to understand these reasons for dishonor of a cheque before taking action.
Reasons for dishonour of cheques dishonour of cheques a cheque is one form of a bill of exchange however, all bills of exchange are not cheques a cheque is always drawn on a bank or a banker it is payable immediately on demand, without any days of grace.
Just as dishonour of a cheque on the ground that the account has been closed is a dishonour falling in the first contingency referred to in section 138, so also dishonour on the ground that the “signatures do not match” or that the “image is not found”, which too implies that the specimen signatures do not match the signatures on the cheque would constitute a dishonour within the meaning of section 138 of the act.