Issue of a Duplicate Demand Draft: A draft is a bill of exchange and the purchaser of the draft is entitled to a duplicate thereof in terms of Section 45-A of Negotiable Instruments Act. Section 45-A of Negotiable Instruments Act states: “Where a bill of exchange has been lost before it is overdue, the person who was the holder of it may apply to the drawer to give him another bill of the same tenor giving security to the drawer, if required, to indemnify him against all persons whatever in case the bill alleged to have been lost shall be found again. If the drawer on request as aforesaid refuses to give such duplicate bill, he may be compelled to do so.”
Where a draft is lost, the person who was the holder thereof at the time of the loss may apply to the issuing branch of the bank to give him a duplicate, giving, if required security to the branch to indemnify it against all persons whatever in case the lost draft is found again. A bank ordinarily requires an indemnity from the purchaser of the original draft before a duplicate is issued. But, such an indemnity cannot be insisted upon where, the purchaser is not the holder of the draft at the time of loss. In such a case bank can ask for security / indemnity / guarantee from the holder only.
There will be constructive delivery of the draft to the payee the moment it was posted by the purchaser, and that thereafter the purchaser has no right to ask the drawee branch to stop payment of the draft on the ground of absence or failure of consideration as between him and the payee. The purchaser’s remedy may lie elsewhere. He may be able to proceed against the payee for beach of contact, or criminal proceedings can be instituted where a fraud is alleged.