Negotiable Instruments Act Section 130 — Cheque bearing “not negotiable”

CHAPTER XIV O F CROSSED C H E Q U E S

General

Summary

If a cheque is crossed and marked with the words “not negotiable,” the person who receives it gets no better legal right to the cheque than the person who gave it to them. This means the receiver cannot claim a stronger or cleaner ownership of the cheque than the previous holder had. Also, that receiver cannot pass on a better title to anyone else they give the cheque to.

Official Text

A person taking a cheque crossed generally or specially, bearing in either case the words “not negotiable,” shall not have, and shall not be capable of giving, a better title to the cheque than that which the person from whom he took it had.