Application of Chapter to drafts
Section 131A of the Negotiable Instruments Act, 1881 deals with application of Chapter to drafts. [The provisions of this Chapter shall apply to any draft, as defined in section 85A, as if the draft were a cheque.] The Act came into force on 01 Mar 1882.
1[The provisions of this Chapter shall apply to any draft, as defined in section 85A, as if the draft were a cheque.]
Section 131A, The Negotiable Instruments Act, 1881 (Act 26 of 1881).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Punjab & Sind Bank vs Vinkar Sahakari Bank Ltd.
Court's Decision & Legal Precedent
A Pay Order issued by a bank is a cheque within the meaning of Section 138 of the Negotiable Instruments Act, 1881, and the holder of such Pay Order has the legal standing to file a criminal complaint for dishonour. The fact that the drawer and drawee are the same banking institution does not prevent the instrument from being a cheque when held by a third party. The holder is presumed to be a holder in due course under Section 118(g) unless the contrary is proved, and such presumption cannot be rebutted at the stage of quashing the complaint but only during trial.
On this section: Application of cheque provisions to drafts; court held this section widens scope of crossed drafts to contain all incidences of crossed cheque
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… the account was authorized to be opened on 07.07.2005, the entire fraud had been committed before that period, which could not have been possible, but only with the active connivance of the then Branch Manager of the petitioner Bank. Considering all these aspects, the DRAT has rightly concluded that protection under Section 131 and 131A of the Negotiable Instruments Act, is not available to the petitioner Bank. In support of the said submissions, reliance has been placed on the Delhi High Court Judgment in Axis Bank vs. Punjab National Bank and another, made in W.P.(C)No.6201 of 2014 dated 20.03.2015 to state …
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… or forged bank draft and if payment is collected under such a bank draft by a bank, such bank is liable for conversion and therefore is bound to make payment of the amount of the forged cheque/bank draft. The collecting banker can only avoid its liability provided it strictly fulfills the conditions laid down under Sections 131 and 131A of the Negotiable Instruments Act, 1881 i.e. it must show that the payment has been received by it in good faith and without negligence. Supreme Court has further observed that though negligence is towards collecting of the instrument however the opening of the account is closely related to the deposit of the …
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… or forged bank draft and if payment is collected under such a bank draft by a bank, such bank is liable for conversion and therefore is bound to make payment of the amount of the forged cheque/bank draft. The collecting banker can only avoid its liability provided it strictly fulfills the conditions laid down under Sections 131 and 131A of the Negotiable Instruments Act, 1881 i.e. it must show that the payment has been received by it in good faith and without negligence. Supreme Court has further observed that though negligence is towards collecting of the instrument however the opening of the account is closely related to the deposit of the …
Questions about Section 131A
What have the courts held on Section 131A of the Negotiable Instruments Act?
Punjab & Sind Bank vs Vinkar Sahakari Bank Ltd. (17 Sep 2001) is the leading judgment on this section among those set out below: Application of cheque provisions to drafts; court held this section widens scope of crossed drafts to contain all incidences of crossed cheque.
How do I find court cases under Section 131A of the Negotiable Instruments Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: NI Act 131A, section 131A NI Act, section 131A of the Negotiable Instruments Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Punjab & Sind Bank vs Vinkar Sahakari Bank Ltd. (17 Sep 2001).
What should I read with Section 131A of the Negotiable Instruments Act, and has it changed?
Its own text turns on section 85A (Drafts drawn by one branch of a bank on another payable to order), so none of them can safely be read on its own.
When did Section 131A of the Negotiable Instruments Act come into force?
Section 131A of the Negotiable Instruments Act, cited as NI Act 131A, came into force on 01 Mar 1882, having been enacted on 09 Dec 1881. It is in force as at the date shown on this page.
Other sections of this Act
- 138. Dishonour of cheque for insufficiency, etc., of funds in the account312 words
- 142A. Validation for transfer of pending cases299 words
- 143. Power of Court to try cases summarily297 words
- 143A. Power to direct interim compensation291 words
- 142. Cognizance of offences290 words
- 141. Offences by companies287 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.