Negotiable Instrument Act Part 1

Validity period for the presentment of cheque in bank is

• 3 months

• 6 months

• 1 year

• 2 years

A negotiable instrument that is payable to order can be transferred by:

• Simple delivery

• Indorsement and delivery

• Indorsement

• Registered post

Days of grace provided to the Instruments at maturity is:

• 1 day

• 2 days

• 3 days

• 5 days

As per the Negotiable Instruments Act, 1881, when the day on which a promissory note or bill of exchange is at maturity is a public holiday, the instrument shall be deemed to be due on the

• Said Public Holiday

• 5 days succeeding public holiday

• Next succeeding business day

• Next preceding business day

Which of the following is an essential characteristic of a promissory note

• There must be an order to pay certain sum

• It must be payable to bearer

• It must be signed by the Payee

• It must contain an unconditional undertaking

The date of maturity of a bill payable hundred days after sight and which is presented for sight on 4th May, 2021, is:

• 13^th August, 2021

• 14^th August, 2021

• 15^th August, 2021

• 16^th August, 2021

An instrument which is vague and cannot be clearly identified either as a bill of exchange, or as a promissory note, is called as:

• Bearer instrument

• Ambiguous instrument

• Order instrument

• Inland instrument

A promissory note dated 31st August, 2022, is made payable three months after date. What will the maturity date for this instrument?

• 30th October, 2022

• 31st October, 2022

• 2nd December, 2022

• 3rd December, 2022

As per the provisions of the Negotiable Instruments Act, 1881, which among the following can be considered as an incorrect statement as regard to ambiguous instrument?

• Where an instrument may be construed either as promissory note or bill of exchange, but the holder treats it only as a bill of exchange and the instrument is henceforward treated accordingly.

• Where an instrument may be construed either as a promissory note or bill of exchange, but the holder treats it only as a promissory note and the instrument is henceforward treated accordingly.

• Where an instrument may be construed either as a promissory note or bill of exchange, but the holder treats it as either, and the instrument is henceforward treated accordingly.

• Where an instrument may be construed either as a promissory note or bill of exchange, the holder cannot treats it either as a promissory note or as a bill of exchange.

Holder in due course means any person who has:

• the possession of the cheque for consideration

• become the holder before maturity thereof

• has the possession in good faith

• all of the above