Demand Drafts

Demand Drafts• Definition NI Act 85(A)• Payable to order on demand• Not made payable to bearer• Features similar BOE• Bank Failure• Signature on Demand Draft• Prior Arrangements

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DD - Sample

Demand Drafts• Security Features in DD• OT, TT, OL, TL• 0, 1, 2, 3, 4, 5, 6, 7, 8, 9• stationery• Crossing• Demand drafts (Cheques)

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Demand Drafts• Relationship purchaser payee• Stop Payment of Demand Draft (purchaser, Payee, Bank, Court)• Cash Receipt/Payment• Duplicate Demand Draft (Purchaser, Payee)

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Demand Drafts• Payment of Duplicate/original• Presented together• Original is already Paid• If duplicate is already paid• Original presented before the

duplicate

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Demand Drafts• Validity • Revalidation

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Demand Drafts• How do you handle a situation where• 1. A Demand draft issued by your other branch is presented through clearing is unsigned 2. Customer is not ready to give an indemnity bond but he wants the duplicate Demand Draft 3. RBI Draft brought by your Customer is 8 months old. Can you make the payment? 4. Customer comes and demands for bearer Demand draft when cheques are issued why not DD

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Demand Drafts• A person not having account with the branch

presents a Demand draft for Rs 5000 on the counter . What is reaction ?

• A Demand draft presented for payment where issuing branch name is missing. What is your reaction ?

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