Font size
WorksheetsNegotiable Instruments
Total questions: 90
Worksheet time: 50mins
In India, the Negotiable Instruments Act was passed in the year ……
1981
1881
1918
1818
Which of the following is NOT a feature of Negogyiable Instruments
Free Transferability
Negotiability
Not Repayable
Must be in Writing
Free Tranferability means …………
Not required to execute Tranfer Deed
Not Required to pay Stamp Duty
Not Required to get Registered
Requires Delivery of the instrument
All of the above
A Negotiable Instrument which does NOT specifies the name of person to whome the payment is to be made is called as ……
Oder Instrument
Payer Instrument
Specified Instrument
Bearer Instrument
When a Negotiable Instrument is payable to the Bearer, it can be tranfered by ……
Executing Tranfer Deed
By Endorsement
Mere Delivery
By Endorsement and Delivery
When a Negotiable Instrument is an Order Instrument, it can be tranfered by ……
Executing Tranfer Deed
By Endorsement
Mere Delivery
By Endorsement and Delivery
Negotiablity bestows unconditional and good title on the …….
Transferor
Transferee
Both of them
None of them
Conditions of negotiability includes ………..
The instrument should be freely transferable by the custom of trade
The instrument can be transferred any number of times within its maturity period
The person who obtains it in good faith and for value, gets it free from all defects
All of the above
Instruments which are considered equivalent to negotiable instrument does NOT include …….
Bearer Bonds
Treasury Bills
Certificate of Deposits
Share Certificate
which of the following are NOT negotiable instruments , as they are not able to a better tiltle to the transferee than that of the transferer
Postal Order
Fixed Deposit Receipt
Bill of Lading
Railway Receipts
All of the above
which of the following is NOT TRUE about negotiable instruments
thre must be an unconditional order or promise
payment of certain sum of money
uncertain time of payment
payee must be certain
should bear the signature of its maker
presumptions of negotiable instruments as per section 118 and 119 does NOT include …..
Negotiable Instruments must be dealt with for valuable consideration
acceptance of a bill of exchange must be done before its maturity
Negotiable Instruments bearing a date was made or drawn on such dates
endorsement of negotiable instruments must be made after its maturity date
which of the following is an example of negotiable instruments by custome or usage
Cheque
Hundies
Pro Note
Bill of Exchange
Features of Hundies include …….
localised instruments used for trade and credit
no stadard format and contents
part of informal system
not recongnised by Negotiable Instruments Act
All of the above
Definition of Promissory Note is given under …..
Sec 2
Sec 4
Sec 5
Sec 6
Promissory Note is ….
a written order
a written request
a written instruction
a written promise
which of the following is NOT TRUE about Promissory Note
an unconditional undertaking
Signed by the Maker
promise to receive money after the stipulated date
promise to pay a certain sum of money after the stipulated date
the person to whome the money in respect of a negotiable instrument is to be paid is termed as …..
Drawer
Drawee
Payee
All of the above
The Creditor who is named in a pomissory note and receives it, is termed as.....
Drawer and Payee
Drawee and Payee
Both of them
none of them
which is NOT true inrespct of a Pro Note
must be stamped as per Indian Stamp Act
Delivery of the Pro Note to the Drawee is essential
It is payable on demand or after a certain period
The maker need not be a certain person
Definition of Bill of Exchange is given under …..
Sec 2
Sec 4
Sec 5
Sec 6
which of the following is NOT TRUE about Bill of Exchange
It is an instrument in writing
contains an unconditional undertaking
signed by the maker
contains an unconditional order
directing a certain
person to pay a certain sum of money
The three parties to a bill of Exchange does NOT include ….
Drawer the Creditor
Drawee the Debtor
Payee
Drawer the Debtor
which of the following is TRUE in respect of Bill of Exchange
Drawer and Drwaee may be the same person
Drawer and Payee may be the same person
Drawee and Payee may be the same person
None of the above
which is NOT true inrespct of Acceptance of a Billof Exchange
The Drawer puts his signature and accept the bill
The Drawee puts his signature and accepts the bill
The word "accepted" may or may not be written on the face
Bill of Exchange become valid only when it is accepted
A bill drwan by a person to help one party or both financially is termed as ……
Trade Bill
Demand Bill
Accommodation Bill
Time Bill
Bills which are payable after a specified period of time is termed as…..
Trade Bill
Demand Bill
Accommodation Bill
Time Bill or Term Bill
If the Drawer and Drawee of a bill reside in the same country , then the bill is ….
Regional Bill
Country Bill
National Bill
Inland Bill
If the Bill is Drawn in one country and is accepted and payable in another country , then the bill is ….
Domestic Bill
Trade Bill
Foreign Bill
Inland Bill
Tenor of the bill means …..
Terms and Conditions of the Bill
the time period of bill after which it become payable
the amount of the bill
None of the above
Which is NOT applicable to a Demand Bill
No fixed maturity period
payable at any time when it isp resented
date of maturity is stated in the bill itself
None of the above
The person to whome the bill of exchange is written and who is liable to pay the money on the bill is called …….
Drawer
Drawee
Payee
Holder
the process of transferring financial interest of a bill in favour of another party is called …….
Acceptance of Bill
Writing of Bill
Endorsement of Bill
Dishonour of Bill
The person who transfers his rights on the bill in favour of another person is called as ……
Endorsee
Endorser
Acceptor
All of the above
Name of alternate Drawee shown in the bill, who can be contacted if the Drawee refuce to accept / refuce to payment , is called as ……
Secondary Drawee
Drawer in case of Need
Drawee in case of need
None of the above
A person who accepts a bill if the Drawee of the bill refuces to accept , is termed as …….
Acceptor for Honour
Honour for Acceptance
Acceptor for Dishonour
Dishonour for Acceptance
If a bill of exchange is discounted with the bank , then the payee will be …..
Drawer of the Bill
Drawee of the Bill
Bank
None of the above
If a bill of exchange is endorsed to another party , then the payee will be …..
Drawer
Drawee
Endorser
Endorsee
A Cheque as a negotiable Instrument is defined in …..
Sec 2
Sec 4
Sec 5
Sec 6
A Cheque is a bill of exchange with additional qualification feature of …..
it is always drawn on a banker
it is always payable on demand
Both of them
None of them
The Drawee of a cheque will be ……..
Creditor
Debtor
Bank
Customer of a Bank
The Drawer of a cheque will be …….
Creditor
Bank
Customer of a Bank
None of the above
The Payee of a cheque means
A bank who makes payment of the cheque for the customer
A Customer of the bank who issue a cheque
Party who is entitled to get the money from the cheque
All of the above
which of the following is NOT an essential feature of Cheque
instrument in writing
containing unconditional order to pay
payment of certain sum of money
It must be signed by the Drawee
The three additional days over and above the due date given for settlement of a bill of exchange is called as …..
Days of Favour
Days of Honour
Days of Grace
None of the above
Non-payment of negotiable instrument on its maturity date is termed as ….
Honouring of Negotiable Instrument
Dishonour of Negotiable Instrument
Mediation of Negotiable Instrument
None of the above
what is NOT TRUE about a Bearer Cheque
name of payee not written on the cheque
tranfer of cheque by mere delivery is possible
payment of cheque to the bearer through the counter
Proper endorsement by the Drawer is required for transfer
what is TRUE about the ORDER cheque
name of payee is written on the cheque
tranfer of cheque through endorsement and delivery
paying banker should ensure the identity of payee before making payment on the cheque
All of the above
MICR stands for
Magnetic Ink Catridge Reader
Magnitic Invisible Character Recognition
Magnetic Ink Computer Reader
Magnetic Ink Character Recognition
The electronic image of cheque in standardised format used for automated and online clearing and settlement process is called ……
Turnaround Cheque
Automated Cheque
Truncated Cheque
None of the above
CTS in clearing of cheque stads for
Cheque Turnaround Security
Cheque Truncated Security
Cheque Truncation System
None of the above
A Cheque which bears a date that is yet to come ( a future date than the date on which it is issued ) is called as …….
Anti-dated cheque
Post-dated cheque
Stale Cheque
Mutilated Cheque
A cheque which is not presented for payment with in the prescribed time of three months from the date of its issue is called as ……
Anti-dated cheque
Post-dated cheque
Stale Cheque
Mutilated Cheque
A cheque which is torn into two or more pieces is called …..
Anti-dated cheque
Post-dated cheque
Stale Cheque
Mutilated Cheque
To be called as a Holder of Negotiable Instrument , which of the following conditions are to be satisfied
Entitled to possess the instrument in his own name and entitled to receive or recover money from parties concerned
The person must be named in the instrument as payee or endorsee
actual or constructive possession of the instrument lawfully
All of the above
A Person who, for consideration, became the possessor of the instrument before its maturity with utmost good faith is called as ……
Holder
Holder in Due Course
Endorser
Paver
Holder in Due Course is defined as per ……
Sec 7
Sec 8
Sec 9
Sec 10
Conditions to be fulfilled for terming as a Holder in Due Course deos NOT include……….
must obtain the possession of instrument as a payee or endorsee or a bearer
must be obtained for a valuable consideration
must be obtained before its maturity
must have clear knoweledge about the defective title of the transferor
which statement is CORRECT
Holder of a negotiable instrument need not be a Holder in Due Course
Holder in Due Course must be a Holder
Both of the above
None of the above
Crossing of Cheque means ……
drawing two parallel transverse lines on the face of the cheque
crossing can be hand written or stamped
the word "& Co" or " Account Payee " may or maynot be written in between the lines
All of the above
Crossing implies that ….
payment on the cheque should be made through a bank account
payment of cheque through counter cannot be made
It ensures security of cheque payment
It is a direction to the paying banker not to make counter payment
All of the above
which of the following is NOT TRUE about the OPEN CHEQUE
It is a cheque with out crossing
payment on open cheque cannot be made through bank counters
payment will be made to the person whose name is written on it
It is less secure
Marking of Cheque does NOT means …….
a kind of certification given by the paying banker
Stamping across the cheque as "Good for Payment"
Paying banker undertakes the obligation to pay cheque and provides guarantee
marking involves special crossing
If a crossed cheque contains name of a banker in between the transverse lines , the crossing is ……
General Crossing
Special Crossing
Bank Crossing
Crossing by the Holder
who can cross a cheque
Drawer at the time of writing a cheque
Payee if the cheque is given without crossing
Endorsee if the endorsed cheque is given without crossing
All of the above
what is NOT TRUE about Opening of Crossing
cancellation of crossing on the cheque
Drawer alone can cancel the crossing
writes "Pay Cash" and put the Drawer's signature
Drawee can cancel the crossing and make it as Open Cheque
Erasing of Crossing on a cheque by a dishonest person is called …..
Erosion of Crossing
Errorising of Crossing
Obliterating a Crossing
Clearing of Crossing
special crossing of a cheque with more than one bankers' name on it is termed as …...
Multi Crossing
Mutual Crossing
Account Crossing
Double Crossing
Account Payee Crossing implies that …..
Payment on the cheque is made to the Payee's account
It restricts further endosement
Both of the above are correct
None of the above are correct
Endorsement is defined under ……
Sec 10
Sec 12
Sec 14
Sec 15
Endorsement can be done through signing on the …….of negotiable instrument
Back of the instrument
face of the instrument
slip of paper annexed there to
All of the above are correct
A piece of paper attached with the negotiable instrument for endorsement, if the back of the instrument is fully covered, is termed as …….
Transfer Deed
Endorser Deed
Allonge
Affonge
which of the following is NOT a general rule regarding Endorsement
Spell the name as stated in the instrument
Salutations should not be prefixed or suffixed
signature of the endorser
name of bank and bank account number must be stated
which of the following is NOT an effect of Endorsement
Endorser certifies the genuineness of instrument
Endorser gets a better title than that of the endorsee
Endorsee gets a better title than that of the enoser
Endorsee gets the right of further negotiation
what is NOT TRUE about Full Endorsement
It is also called as Special Endorsement
Endorser writes the name of Endorsee
Endorser writes his name and sign it
Endorsee also puts his / her dated signature
If the endorser restricts further negotiation of the instrument, it is called as ….
Blank Endorsement
Special Endorsement
Restrictive Endorsement
Conditional Endorsement
Sans Recourse means ….
with recourse to me
without recourse to the Drawee
without recourse to me
with recourse to the Drawee
What is TRUE about Conditional Endorsement
endorsement contain a condition to pay the instrument
it may limit the liability of endorser
endorsee has to fulfil certain conditions to obtain payment
It is also called as Qualified Endorsement
All of the above
If the endorser surrenders his right to receive notice of dishonour by writing appropriate words at the time of endorsement, it is called ……
Conditional Endorsement
Sans Recourse Endorsement
Qualified Endorsement
Facultative Endorseement
what is NOT TRUE about the Blank Endorsement
endorser simply signs on the back of instrument for negotiation
name of the endorsee not mentioned
it is payable to the bearer
it is also called as Special Endorsement
