Rule 17 - Cheque Payment Dates
Original Rule Text
17. Date of payment.– (1) Wherever the payment is arranged by PAO or CDDO by issuing digitally signed Payment advice for direct credit of the amount to the bank account of the payee, the date on which such advice is successfully uploaded on the payment gateway of the bank or the due date mentioned in Payment advice, whichever is later, shall be reckoned as the date of payment.
(2) Wherever the payment is arranged by PAO or CDDO by issuing a Payment advice other than digitally signed advice for direct credit of the amount to the bank account of the payee, the date of payment shall be reckoned as the date on which such advice is handed over to the bank or the date mentioned in the Payment advice, whichever is later.
(3) Wherever the payment is arranged through the Reserve Bank by issue of RBI advice, the date of payment shall be reckoned as the date indicated against the relevant entry in the payment scroll rendered by the Reserve Bank.
(4) Whenever the payment from India is arranged in foreign currency to a payee in foreign country by issue of an advice to the bank, the date of payment shall be reckoned as the date on which the foreign currency is remitted and equivalent amount is entered in the payment scroll by the bank.
(5) Wherever the payment is made by Government by postal money order or by any other recognised mode of remitting money by post, the date of payment shall be reckoned as having been made on the date on which the receipt for the money is issued by the post office.
(6) Wherever the payment is made by cash, the date on which the cash is paid shall be reckoned as the date of payment.
(7) Without prejudice to the provisions of rule 14 of the Compendium of Rules on Advances, the date of payment when payment is made by a cheque shall be reckoned as,–
(a) bank's working day next to the date of the cheque, if the cheque is handed over to the payee or to the authorised messenger of the employee and it does not bear the superscription for payment on a specific date;
(b) the specific date superscribed on the cheque, if the cheque is handed over to the payee or to the authorised messenger of the employee and the cheque bears superscription for payment on a specific date; and
(c) the date on which the cover containing the cheque is put into the post or the specific date, if it bears superscription for payment on a specific date, whichever is later, as the case may be, if the cheque is posted to the payee in pursuance of a request for sending it by post.
(8) Wherever payment is arranged by means of a bank draft to a payee, the date of payment will be reckoned as,—
(a) date on which it is handed over to the payee or the authorised person of the employee or the specific date superscribed, whichever is later; or
(b) if it is posted to the payee, the date on which the cover containing draft is put into the post or the said specific date, whichever is later, as the case may be.
What This Means
Rule 17 of the Receipt and Payment Rules deals with determining the 'date of payment' when using cheques. This is crucial for accounting purposes and ensuring timely transactions. Essentially, it clarifies when a payment is officially considered made, depending on how the cheque is delivered to the payee (the person or entity being paid). The rule distinguishes between cheques handed over directly and those sent by post, and also considers whether the cheque has a specific 'pay on' date written on it.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Determines the 'date of payment' when using cheques.
- 2Distinguishes between cheques handed over directly and those sent by post.
- 3Considers if the cheque has a specific 'pay on' date.
- 4The date of payment impacts accounting and transaction timelines.
Practical Example
Mr. Sharma, a government employee, receives a cheque for his travel allowance on July 10th. The cheque is handed directly to him by the accounts department. According to Rule 17(a), the date of payment is the next bank working day, which is July 11th. Now, imagine Ms. Verma receives a cheque for her pension, but it's dated 'Payable on July 20th' and handed over on July 15th. Rule 17(b) dictates that the payment date is July 20th. Finally, if Mr. Singh requests his salary cheque to be mailed to him, and the cheque is posted on August 5th, the date of payment is August 5th, even if he receives it later. If that cheque had a 'Payable on August 10th' date and was posted on August 5th, the payment date would be August 10th.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Cross References
Frequently Asked Questions
What happens if the 'pay on' date on the cheque falls on a weekend or holiday?▼
Why is the 'date of payment' important?▼
Does Rule 17 apply to electronic transfers?▼
If a cheque is lost in the mail, what is the date of payment?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Test Your Knowledge
Question 1 of 3
According to Rule 17 of the Receipt and Payment Rules, if a cheque without a specific payment date is handed over to the payee, the 'date of payment' is considered to be: