Cheque Stop Payment Letter Format – What is it, Format

Currently, many banks facilitate this service via the online portal. But in the case where the bank does not have this service online, you will have to write a letter and send it to the bank. Although there is no express legislation dealing with the cheque stop payment, courts have relied upon Section 138 of the Negotiable Instruments Act for their decisions.

Meaning of a Cheque Stop Payment Letter

A cheque stop payment letter is a letter that is written by a person who has issued a cheque and intends to stop payment on that cheque, to their bank. Its only purpose is to not allow the holder of the cheque to cash it in. There are various reasons as to why such a letter may be written. The usual process is when you issue a cheque to a person, he is entitled to encash it at his will. But in circumstances where you would like to stop the holder of the cheque from encashing it, you have to write this letter to the bank.

Format of a Cheque Stop Payment Letter

The format for a cheque stop payment letter will depend on who is issuing the cheque. 

When issued by a company or an organisation: The cheque stop payment letter may be printed on paper with the company letterhead or with the company logo. It should be addressed to the banker and it is a common practice for companies and organisations to affix their seal on to the letter for identification.

Download Cheque Stop Payment Letter Format 1

When issued by an individual: In the case where the cheque was issued by an individual, the letter may be printed on plain A4 size paper in the following format.

Download Cheque Stop Payment Letter Format 2

Information to be Included in a Cheque Stop Payment Letter

• Name of the person the cheque is in favour of.
• Date of issuance of the cheque.
• Value.
• Cheque number.

Reasons for Stopping the Payment on a Cheque Issued

There can be several reasons for which a person may want to stop the other from cashing in a cheque. The most common reasons are:

• When the person issued the cheque for buying products/services but finds that the products/services are defective in some way or has not even received delivery of the said items.
• When the cheque has been stolen or lost.

Disclaimer:The materials provided herein are solely for information purposes. No attorney-client relationship is created when you access or use the site or the materials. The information presented on this site does not constitute legal or professional advice and should not be relied upon for such purposes or used as a substitute for legal advice from an attorney licensed in your state.

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