| PARTICULARS | BILL OF EXCHANGE | CHEQUE |
MEANING
| A bill of exchange is a negotiable instrument which orders to drawee to pay a fixed amount of money to payee on demand | The Cheque is a document which contains an order to a bank to pay fixed amount of money from the account of the client. |
EXISTENCE
| A bill of exchange exists in section 5 of the negotiable instruments act, 1881. | A cheque exists in section 6 of the Negotiable Instruments Act, 1881. |
GRACE PERIOD
| A bill of exchange has three days of grace period. | A cheque has no grace period once it is presented for the payment. |
APPORVED
| A bill of exchange needs an approval from the drawee for the payment. | A Cheque does not need any approval from the parties before presented for payment |
VALIDITY
| A bill of exchange has no validity for the payment. | A cheque has a validity of 3 months. |
| LIABILITY | In the bill of exchange, the parties who do not get notice of dishonour are free from the liability of paying. | Parties remain liable to pay also in case notice of dishonour is not given. |
NOTICE OF DISHONOUR
| In a bill of exchange, notice of dishonour is mandatory. | In cheque, notice of dishonour is not compulsory. |
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