The paying bank should return dishonoured cheques presented through clearing houses strictly as per the return discipline prescribed for respective clearing houses.
The collecting bank on receipt of such dishonoured cheques should despatch it immediately to the payees/holders.
In relation to cheques presented directly to the paying bank for settlement of transaction by way of transfer between two accounts with that bank, it should return such dishonoured cheques to payees/holders immediately, the RBI said in a notification.
Moreover, cheques dishonoured for want of funds in respect of all accounts should be returned along with a memo indicating therein the reason for dishonour as insufficient funds.
Data in respect of each dishonoured cheque for the amount of Rs 1 crore and above should be made part of banks MIS on constituents.
With a view to enforce financial discipline among customers, the RBI has asked banks to introduce the condition that in the case of a dishonoured cheque valuing Rs one crore and above drawn on a particular account of the drawer on four occasions during the financial year, no fresh cheque book should be issued. The bank may also consider closing current accounts at its discretion.