Sections 123-125 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
A crossed cheque carries a marking across its face that limits how it can be paid. Sections 123 to 125 explain what counts as a general crossing, what counts as a special crossing, and who may add or change a crossing after the cheque has been issued. As per the consolidated text consulted, these three sections are the start of the rules on crossed cheques; the consequences for the paying bank follow in later sections.
A cheque is crossed generally when it bears across its face "and company" (or an abbreviation) between two parallel transverse lines, or simply two parallel transverse lines, with or without the words "not negotiable" (s.123). It is crossed specially when it bears the name of a banker across its face, with or without "not negotiable" (s.124). After issue, the holder may cross an uncrossed cheque generally or specially, may turn a general crossing into a special one, and may add "not negotiable"; a banker to whom it is crossed specially may cross it again specially to another banker as his agent for collection (s.125).
What crossing does
Crossing is a direction written on a cheque. The Act's later sections say what the paying bank may do with a crossed cheque: see Sections 126 and 127 and, for what follows payment, Sections 128 to 130. In this article we stay with how a crossing is made and by whom. The definition of a cheque is in Section 6.
The copy consulted does not print where the Chapter on crossed cheques begins; the text consulted places these rules at ss.123 to 131A. If you need advice on a crossed cheque that has gone wrong, a legal consultation can help you place the facts against the sections. A note on spelling: the Act writes "indorse"; "endorse" is the common spelling.
Section 123: cheque crossed generally
The text: "Where a cheque bears across its face an addition of the words 'and company' or any abbreviation thereof, between two parallel transverse lines, or of two parallel transverse lines simply, either with or without the words 'not negotiable', that addition shall be deemed a crossing, and the cheque shall be deemed to be crossed generally."
So there are two ways to cross generally:
- The words "and company", or an abbreviation of them, between two parallel transverse lines.
- Two parallel transverse lines alone.
In either case the words "not negotiable" may be added or left out, and the cheque is still crossed generally. The word "deemed" means the addition is treated by law as a crossing.
Section 124: cheque crossed specially
The text: "Where a cheque bears across its face an addition of the name of a banker, either with or without the words 'not negotiable', that addition shall be deemed a crossing, and the cheque shall be deemed to be crossed specially, and to be crossed to that banker."
A special crossing names a banker. The cheque is then crossed to that banker. The only difference between the two crossings in the text is that Section 123 describes lines (with or without "and company"), while Section 124 describes a banker's name. The meaning of "banker" is in Section 3 of the copy consulted.
Section 125: crossing after issue
The text has four sentences.
- "Where a cheque is uncrossed, the holder may cross it generally or specially."
- "Where a cheque is crossed generally, the holder may cross it specially."
- "Where a cheque is crossed generally or specially, the holder may add the words 'not negotiable'."
- "Where a cheque is crossed specially, the banker to whom it is crossed may again cross it specially to another banker, his agent, for collection."
Note what the section does not say. It does not allow a holder to remove a crossing, and it does not allow a special crossing to be turned back into a general one. The text lists only the changes above.
| Starting position | Who | What may be done (s.125) |
|---|---|---|
| Uncrossed | Holder | Cross generally or specially |
| Crossed generally | Holder | Cross specially |
| Crossed generally or specially | Holder | Add "not negotiable" |
| Crossed specially | The banker to whom it is crossed | Cross it again specially to another banker, his agent, for collection |
Comparing the two crossings
| Point | General crossing (s.123) | Special crossing (s.124) |
|---|---|---|
| What is written across the face | "and company" (or abbreviation) between two parallel transverse lines, or two parallel transverse lines simply | The name of a banker |
| "Not negotiable" | May be added or omitted | May be added or omitted |
| Effect on the cheque | Deemed crossed generally | Deemed crossed specially, to that banker |
Two examples
Example 1. Deepa Retailers writes a cheque in favour of Ghosh Suppliers and draws two parallel lines across its face. Under Section 123 the cheque is crossed generally. Ghosh Suppliers, as holder, later writes the name of its own bank across the face. Under Section 125 the holder may cross a generally crossed cheque specially, and under Section 124 the cheque is now crossed specially to that bank.
Example 2. Hari Brothers receives an uncrossed cheque and is worried about theft in the post. Under Section 125 the holder may cross it generally or specially, and may then add the words "not negotiable". The effect of "not negotiable" on title is dealt with in Section 130; it is not covered here.
Points to watch
- Words and lines. The text speaks of lines "transverse" across the face, and of "and company" or an abbreviation between them. It does not prescribe where on the face the crossing must sit.
- Only the stated changes. Section 125 lists the changes a holder may make. It is silent on removal of a crossing.
- Agent for collection. The second special crossing to an agent is allowed only for collection and only by the banker to whom the cheque was crossed.
- Different from Section 138. Crossing is about how a cheque may be paid. The offence for a returned cheque is in Section 138.
- Drafts. Section 131A applies these provisions to a draft as defined in Section 85A; see our article on Sections 131 and 131A.
Need help with a crossed cheque?
If a cheque has been crossed, re-crossed or paid in a way you did not expect, the crossing as it appears on the cheque is the first fact to fix. A legal consultation with us can help you read the crossing against Sections 123 to 125 and decide what follows.
Key takeaways
- A general crossing is two parallel transverse lines, with or without "and company" and with or without "not negotiable" (s.123).
- A special crossing is the name of a banker, with or without "not negotiable" (s.124).
- The holder may cross an uncrossed cheque, turn a general crossing special, and add "not negotiable" (s.125).
- A banker to whom a cheque is specially crossed may cross it again to another banker as agent for collection.
- The text is silent on removing a crossing.
Read next
- Sections 126 and 127: payment of crossed cheques by the drawee bank
- Sections 128 to 130: crossed cheque paid in and out of due course, and not negotiable
- Section 6: cheque, truncated cheque and electronic cheque
- Types of negotiable instruments: cheque, bill, promissory note
Disclaimer: Based on a consolidated text of the Negotiable Instruments Act, 1881 stating the position as of 26 December 2015 and on the Negotiable Instruments (Amendment) Act, 2018, as consulted on 2 October 2026. Later amendments and current criminal procedure law should be checked. This article is general information, not legal advice; check the official text before acting.