Negotiable Instruments Act Section 58 — Instrument obtained by unlawful means or for unlawful consideration
CHAPTER IV OF NEGOTIATION
General
Summary
If a negotiable instrument like a cheque is lost, or if it is obtained through a crime, fraud, or for an illegal reason, the person who finds or obtains it that way has no right to be paid. Anyone who later receives the instrument from that person also cannot claim the money from the original maker, acceptor, holder, or any earlier party. The only exception is if the person now holding it, or the person they got it from, is a holder in due course—meaning they took it in good faith and for value.
Official Text
When a negotiable instrument has been lost, or has been obtained from any maker, acceptor or holder thereof by means of an offence or fraud, or for an unlawful consideration, no possessor or indorsee who claims through the person who found or so obtained the instrument is entitled to receive the amount due thereon from such maker, acceptor or holder, or from any party prior to such holder, unless such possessor or indorsee is, or some person through whom he claims was, a holder thereof in due course.