Postdated cheque

In banking, post-dated cheque is a cheque written by the drawer (payer) for a date in the future.

Whether a post-dated cheque may be cashed or deposited before the date written on it depends on the country. A Canadian bank, for example, is not supposed to process a post-dated cheque and if it does so by mistake, the cheque writer may ask his or her bank to correct the error. In the United States and the UK, post-dated cheques are negotiable instruments and can be drawn upon at any time, while in India post-dated cheques are not payable until the date written on the cheque.

In Brazil, the drawer may seek damages in Justice if their cheque is cashed in before its due date, according to the jurisprudential orientation of the Superior Court of Justice, as per Summary No. 370 of such court.

Under the clearing rules of the Canadian Payments Association, a post-dated cheque cannot be cashed prior to the date written on it. If a Canadian financial institution inadvertently accepts and processes a cheque before the due date, the cheque writer may ask his or her financial institution to return the amount until the day before the cheque should have been cashed.

Post-dated cheques in Indian law are illegal. Section 68 of Indian Stamp Act declares that a person who draws a post dated cheque and the person who presents a post dated cheque for payment will be liable to be fined Rs. 1000/- each.

Post dated cheque is no negotiable instrument.

However all the court rulings missed looking into relevant sections of law.

The definition of a cheque in Negotiable instrument act as well as in Negotiable Instruments Act is - that a cheque is always made payable on demand. It is not difficult to understand that a post dated cheque is not payable on demand.

The courts considered under the Negotiable Instruments Act, 1881. Post-dated cheques are common and enforceable. In 1998, the Supreme Court ruled that a post-dated cheque is a bill of exchange and does not become payable on demand until the date written on the cheque:

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