BUSINESS LAW (B.COM)
PART –(B)
(B). Negotiable Instruments Act
1881
WHAT IS NEGOTIABLE INSTRUMENTS
we will define the negotiable
instruments.
"A negotiable instrument means a promissory note, bill or exchange or cheque payable either to order or to bearer."
Section 13(1) of Negotiable Instruments Act 1881
"A negotiable instrument means a promissory note, bill or exchange or cheque payable either to order or to bearer."
Section 13(1) of Negotiable Instruments Act 1881
WHAT
IS PROMISSORY NOTE
Promissory note is written
promise for paying any certain amount to the person whose name is written in
the promissory note.
(a signed document
containing a written promise to pay a stated sum to a specified person or the
bearer at a specified date or on demand.)
TYPE OF NEGOTIABLE INSTRUMENTS
In day-to-day banking, a negotiable instrumentusually refers
to checks, drafts, bills of exchange, and some types of
promissory notes. ... Forms ofNegotiable Instruments. • A negotiable
instrumentis a written order promising to pay a sum of money.
Most Common types of negotiable
instruments are;
§ Promissory notes.
§ Bill of exchange.
§ Check.
§ Government
promissory notes.
§ Delivery orders.
§ Customs Receipts.
Most negotiable instruments fall under the following two categories; the
Negotiable instrument by statute and Negotiable instruments by custom or
usages.
Negotiable
instrument acts state three instruments. check, bill of exchange and promissory
notes are negotiable instruments. They are therefore called negotiable
instruments by statute.
Negotiable
instruments by Statute are;
Promissory
Notes as Negotiable Instrument
The
promissory note is a signed document of written promise to pay a stated sum to
a specified person or the bearer at a specified date or on demand.
The
promissory note is an instrument in writing containing an
unconditional rule signed by one party to pay a certain sum of money
only to, or to the order of a certain person or to the bearer of the
instrument.
Thus a
promissory note contains a promise by the debtor to the creditor to pay a
certain sum of money after a certain date. The debtor is the maker of the
instrument.
Bill of
Exchange as Negotiable Instrument
The Bill
of Exchange contains an order from the creditor to the debtor to pay a certain
person after a certain period.
The
person who draws it is called drawer (creditor) and the person on whom it is
drawn is called drawee (debtor) or acceptor.
The
person to whom the amount is payable is called payee.
Check as Negotiable
Instrument
A Check
(cheque in royal Britain) is a bill of exchange drawer a specified banker not
expressed to be payable otherwise than on demand.
It is an
instrument in writing, containing unconditional order, signed by the maker
(depositor), directing a certain banker to pay a certain sum of money to the
bearer of that instrument.
Some
other instruments have acquired the character of negotiability by customs or
usage of trade.
Negotiable
instruments by custom or usages are mainly, the government
promissory notes, delivery orders, and railway receipts have been held to be
negotiable by usage or custom of the trade.
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WHAT IS NEGOTIABLE INSTRUMENTS
WHAT IS NEGOTIABLE INSTRUMENTS
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