Negotiable Instruments have been used in commercial world for a long period of time as one of the convenient modes of transferring money. Development in banking sector and with the opening of new branches, cheque became one of the common negotiable instruments. The importance of cheque as an negotiable instrument can logically sensed from the aforesaid Privy Council decision that, “in the case of a cheque acceptance is not necessary to create a liability to pay as between the drawer and the drawee bank. The liability depends on the contractual relationship between the bank and the drawer, its customer. Other things being equal, in particular, if the customer has sufficient funds or credit available with the bank, the bank is bound either to pay the cheque or dishonour it at once. But if the bank (at least at the drawer’s request), accepts the cheque, he should be entitled to protect himself as against his customer by setting aside the appropriate funds standing to the cu ....