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Joy Dey (Advocate)     25 November 2009

Self Cheque - who has enchased?

Dear All,

I have an interesting query and would appreciate if anyone could throw some light on it.

There is a savings account of a particular wing of the State Government Education Department with a scheduled bank of India. The account can be operated only jointly by two signatories. A particular cheque of a considerably high amount was drawn to 'SELF', and signed by both the signatories, both on the face of the cheque, as well as at the back of the cheque.


1. Whom will the bank give the cash to - i.e. which of the two signatories will get the cash.

2. If the cheque has already been enchased, can it be determined which one of the signatories had taken the cash from the bank?

3. Is there any RBI guideline/circular regarding encashing of cheques which have two or more joint signatories?




 13 Replies

sachin (advocate)     25 November 2009

 we need to arrest that cashier first he or she will certainly tell about it. i think he is also involved in this scam, we need police investigation first. 


1. If it is huge amount authorization letter have to bring from the Head of the Office. Any one of the two signatures can withdraw the amount from the bank. Presence of two is not necessary in the bank.

2. Yes. He can be find out.  While presenting the cheque in the bank  and if it is the huge amount, banker will take signature who came for withdrawal of money from the bank.

If any scam involved banker, head of the office and two authorised signatures are held responosible.



Adv. T.K Sujith (lawyer)     26 November 2009

 I am also agreeing with satya prakash sir

K.MOHANDAS (Lawyer)     26 November 2009

govt  account  is not like an ordinary self cheque can be drawn.If any payment is made based on self cheque,it amounts to conversion.The concerned officials will be liable.

Joy Dey (Advocate)     26 November 2009

Dear friends, thank you for your interest in the query, and for your replies.


@ Sachin - Police investigation is on, or being initiated. But on what ground could the cashier be arrested? As I already mentioned, the requirement of encashing the cheqeu - i.e. signatures of both the signatories, were present, not only on the face of the cheque, but also on the back of it. So, the cashier is legally correct in honouring the cheque and tendering the cash against its encashment. There is no doubt that the bank officials are also involved in the scam, which is to the tune of over Rs.50 cr (although withdrawn by a series of transactions). However, precisely to your concern about arresting the cashier, I cant see any grounds for the same. Could you elaborate on other grounds?


@ Sathya Prakash / T.K.Sujith - There was no requirement that the account be operated by any authorisation letter. Joint signatures on the cheque was sufficient. I agree that any cheque, duly signed by both signatories, may be encashed without the physical presence of the signatories, but this is not the issue at hand. Further, as I mentioned that the cheque bore the signatures of both the signatories on the back of the cheque (see my reply to Sachin above), how can it be proved that the 1st signatory and not the 2nd, or vice-versa, has taken the cash from the counter? Further, is it mandatory for the bank to keep an account of the person encashing a self-cheque? If yes, then can you tell me the legal sanction for the same? If not, then why shall the bank be responsible to identify the person who took the cash from the counter?


@ Mohandas - Is there any legal restriction that no self-cheque can be drawn on a government acount? Could you please cite any RBI or Banking notification/guideline/regulation or case law?



Thanks all for taking part in this discussion.




N.Ramakrishnan (Advocate/ Senior Partner)     26 November 2009

Dear Mr. Joy,

 I am not aware if there are any restrictions by RBI in permitting withdrawal of cash from Government Accounts. Assuming that there is no such restriction, then the cashier cannot be made liable if the signatures of the authorised signatures are found in the front and back of the cheque subject to the following:

a. If the cheque was of a high value, the officer who is authorised to pass the same should have approved the transaction.

b. One of the two signatories should have been personally present to withdraw the cash since, if the cheque is presented by a third person, the cashier is expected to get his signature, name and address behind the cheque.

c. In large cash transactions, irrespective of the fact that the authorised signatory himself is present for withdrawal, the cashier is expected to get one more signature of the person presenting the cheque in his presence behind the cheque for verification and confirmation.

In any event, the cashier alone cannot be made liable.


N.Ramakrishnan, ADV


Joy Dey (Advocate)     26 November 2009

@ Mr. Ramakrishnan - Thanks for the precise response. My observations on your comments are as follows:


a. The transaction is duly authorised.

b. It is not disputed that one of the two signatories, and not a third person, has withdrawn the cash. However, I have to establish that it was the 1st signatory, and not the 2nd signatory (my client) who has taken the cash. Since both have signed at the back of the cheque, and there being no other signatures on the cheque, how can I contend that it is not my client who has received the cash?

c. It seems that the cashier has overlooked this provision to seek another signature of the person receiving the cash. I may use this in my favour, but I would still require the mandate which compels the cashier to seek the signature of the person receiving the cash against a self-cheque. Would you have any information regarding such a mandate?





When dealing with Government account transcation it is mandatory to take signature at the counter of the withdrawal person even though authorised signatures on the face of the cheque. Banker, two signaturees and head of the office held responsible.

Isaac Gabriel (Advocate)     27 November 2009

While parting with cash,the banker is to identify the receiver for which no guidelines is needed.In all genuine withdrawals,through cheque,be it single or joint  account the individual presenting the same for encashmewnt is supposed to receive cash.In the given case,if both dispute from getting the proceeds,both have to be taken into task,though it is a Government account and the cheque being sent for  encashment as 'self ' ,else a complaint to have been lodged as  being stolen from the office .

Sukhija (Advocate)     03 December 2009

Dear Joy

whoever has withdrawn the cash on self cheque with sign on it has done it legally correct with authority. Both r responsible for withdrawal of that amount if there r any consequences following it. No escape.

Prasadh Srinivasulu (Other)     08 January 2010

I agree that both of them who signed will be legally responsible however the withdrawal of the other signatory is proved.

nowadays most banks especially in cities are under surveilance, i have seen it in many banks that there are cameras especially near cash counters, in case if your bank had that, you can try to make use of it, just in case. because such surveilance videos are to be archived upto a reasonable period and saved.

cross investigating the cashier or banker should help, right ?

bec they have to say or identify under normal circumstances on who of the 2 could they remember to have seen at that time. 

also in such withdrawals above 50000 , they always take a pan card copy of the receiver or any other identification proof and xerox it there for their purpose. wasn't this done at all ?

if this was not done, the banker/cashier is equally responsible

may not be useful though, just my thoughts which i felt to pen them down


Prasadh Srinivasulu (Other)     08 January 2010

Meant " I agree that both of them who signed will be legally responsible however UNLESS the withdrawal of the other signatory is proved."


I think the role of the officer who passes the cheque or the cashier is limited to releasing the amount as far as the signatories signatures are verified in their computer (scanned) and found tallied and it is for the recipients of the cash to account them properly for in the Department's books of account.

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