What is Delivery of instrument on payment, or indemnity in case of loss? How to Discharge from liability? Delivery of instrument on payment, or indemnity in case of loss and Discharge from liability are defined under Section 81 and 82 of Negotiable Instruments Act 1881
(1) Any person liable to pay, and called upon by the holder thereof to pay, the amount due on a promissory note, bill of exchange or cheque is before payment entitled to have it shown, and is on payment entitled to have it delivered up, to him, or, if the instrument is lost or cannot be produced, to be indemnified against any further claim thereon against him.
(2) Where the cheque is an electronic image of a truncated cheque, even after the payment the banker who received the payment shall be entitled to retain the truncated cheque.
(3) A certificate issued on the foot of the printout of the electronic image of a truncated cheque by the banker who paid the instrument, shall be prima facie proof of such payment.
The maker, acceptor or indorser respectively of a negotiable instrument is discharged from liability thereon-
(a) by cancellation.-to a holder thereof who cancels such acceptor's or indorser's name with intent to discharge him, and to all parties claiming under such holder ;
(b) by release.-to a holder thereof who otherwise discharges such maker, acceptor or indorser, and to all parties deriving title under such holder after notice of such discharge ;
(c) by payment.-to all parties thereto, if the instrument is payable to bearer, or has been indorsed in blank, and such maker, acceptor or indorser makes payment in due course of the amount due thereon.
CHAPTER VII OF DISCHARGE FROM LIABILITY ON NOTES, BILLS AND CHEQUES
CHAPTER VIII OF NOTICE OF DISHONOUR
CHAPTER IX OF NOTING AND PROTEST