What Is The Procedure Against Forgery?

If a forged cheque comes before the banker fro payment and if it is known that the signature is forged he must reject the payment. Even if he accepts the forged cheque without knowing the forged signature of the customer, the liability of the banker on the instrument will not be discharged because payment on a forged instrument is not payment at all. The law imposes certain duties and obligations to the banker as well as the cutomer. The banker is always responsible to his customer for the payment on a forged cheque. The banker wouldn’t enjoy statutory protection given to him under the NI Act. Even though it is the duty of the banker to identify the sign of the customer it is also the duty of the customer not to be negligent in keeping the chequebook, his negligence should not be the proximate cause of loss or forgery of the chequebook.