धारा 40

Section 40 of the Negotiable Instruments Act, 1881, provides protection to both the banker and the drawer of a cheque where the cheque is crossed. The section states that where a cheque is crossed specially to more than one bank, or is crossed generally, the banker on whom it is drawn shall not be liable if he pays it, if crossed specially, to the bank to which it is crossed, or, if crossed generally, to any banker. This protection is extended to prevent the banker and the drawer from being liable in cases where the cheque is paid in accordance with the crossing instructions, thereby reducing the risk associated with the payment of crossed cheques. Courts have interpreted this section as offering a safeguard against claims of wrongful payment, provided the payment is made in accordance with the crossing, emphasizing the importance of adhering to the crossing instructions to avail of this protection.