Question

The collecting banker is given protection under Section 131 for collecting a crossed cheque for a customer in good faith and without what?

Q: Answer-The collecting banker is given protection under Section 131 for collecting a crossed cheque for a cu...

Section 131 of the Negotiable Instruments Act protects a collecting banker who, in good faith and without negligence, receives payment for a customer of a cheque crossed generally or specially to himself. If the customers title to the cheque is found to be defective, the banker incurs no liability merely because of having received such payment. This protection is conditional on the banker acting without negligence. It encourages banks to provide collection services for crossed cheques.