Definition of bill of exchange
Section 5 of the NI Acts 1881 defines a bill of exchange as under “A bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money to, or to the order of, a certain person or the bearer…
Read article Definition of Usance Bills
Section 22 of Negotiable instrument act 1881 provides that “every promissory note, bill of exchange which is not expressed to be payable on demand, at sight or on presentment is at maturity on the third day after the date on which is expressed to be payable”. Thus, in the case of Usance bills, three days…
Read article Definition of a Cheque
A cheque is defined in section 6 of Negotiable Instruments acts 1881 which provides that, “A cheque is a bill of exchange, drawn on a specified banker and expressed to be payable otherwise than on demand”. The electronic image of a truncated cheque and a cheque in the electronic form (e-cheque) are also termed as ‘cheque’ after coming into…
Read article Difference between Hundi and Hawala
(The similarities in usage of Hundis in India and Hawala system prevalent in the Middle East and North African countries are discussed in this post) Hundis have been in usage in India from ancient times but usages are not uniform and they are different at different places. Being a part of the informal system, Hundi…
Read article What are the types of ‘Bills of Exchange’ used in trade?
Demand bills, Usance bills, clean bills, Documentary Bills, Accommodation bills, Hundis etc. are a different kind of bills of exchange in usage for different types of trade transactions. A cheque is also a kind of bill of exchange. However, cheque has some peculiarities from other bills of exchange. If a bill of exchange drawn or made…
Definition of Promissory Note
Section 4 of NI Act 1881 states that “ A promissory note is an instrument in writing (not being a bank note or currency note), containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to, or to the order of a certain person or to the bearer of the…
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