Civil Law and Procedure
The Negotiable Instruments Act, 1881
Act 26 of 1881 · 155 sections
Practise questions on Negotiable Instruments Act, 1881
Title, date and preamble
[9th December, 1881.]
An Act to define and amend the law relating to Promissory Notes, Bills of Exchange and Cheques.
Preamble.—Whereas it is expedient to define and amend the law relating to promissory notes, bills
of exchange and cheques; It is hereby enacted as follows:—
Contents
CHAPTER I PRELIMINARY
CHAPTER II OF NOTES, BILLSAND CHEQUES
- 4.“Promissory note.”
- 5.“Bill of exchange.”
- 6.“Cheque.”
- 7.“Drawer” “Drawee”
- 8.“Holder”
- 9.“Holder in due course”
- 10.“Payment in due course”
- 11.Inland instrument
- 12.Foreign instrument
- 13.“Negotiable instrument”
- 14.Negotiation
- 15.Indorsement
- 16.Indorsement “in blank” and “in full”
- 17.Ambiguous instruments
- 18.Where amount is stated differently in figures and words
- 19.Instruments payable on demand
- 20.Inchoate stamped instruments
- 21.“At sight”
- 22.“Maturity”
- 23.Calculating maturity of bill or note payable so many months after date or sight
- 24.Calculating maturity of bill or note payable so many days after date or sight
- 25.When day of maturity is a holiday
CHAPTER III PARTIES TO NOTES, BILLS AND CHEQUES
- 26.Capacity to make, etc., promissory notes, etc
- 27.Agency
- 28.Liability of agent signing
- 29.Liability of legal representative signing
- 30.Liability of drawer
- 31.Liability of drawee of cheque
- 32.Liability of maker of note and acceptor of bill
- 33.Only drawee can be acceptor except in need or for honour
- 34.Acceptance by several drawees not partners
- 35.Liability of indorser
- 36.Liability of prior parties to holder in due course
- 37.Maker, drawer and acceptor principals
- 38.Prior party a principal in respect of each subsequent party
- 39.Suretyship
- 40.Discharge of indorser's liability
- 41.Acceptor bound, although, indorsement forged
- 42.Acceptance of bill drawn in fictitious name
- 43.Negotiable instrument made, etc., without consideration
- 44.Partial absence or failure of money-consideration
- 45.Partial failure of consideration not consisting of money
- 45A.Holder's right to duplicate of lost bill
CHAPTER IV OF NEGOTIATION
- 46.Delivery
- 47.Negotiation by delivery
- 48.Negotiation by indorsement
- 49.Conversion of indorsement in blank into indorsement in full
- 50.Effect of indorsement
- 51.Who may negotiate
- 52.Indorser who excludes his own liability or makes it conditional
- 53.Holder deriving title from holder in due course
- 54.Instrument indorsed in blank
- 55.Conversion of indorsement in blank into indorsement in full
- 56.Indorsement for part of sum due
- 57.Legal representative cannot by delivery only negotiate instrument indorsed by deceased
- 58.Instrument obtained by unlawful means or for unlawful consideration
- 59.Instrument acquired after dishonour or when overdue
- 60.Instrument negotiable till payment or satisfaction
C H A P T E R V O F P R E S E N T M E N T
- 61.Presentment for acceptance
- 62.Presentment of promissory note for sight
- 63.Drawee’s time for deliberation
- 64.Presentment for payment
- 65.Hours for presentment
- 66.Presentment for payment of instrument payable after date or sight
- 67.Presentment for payment of promissory note payable by instalments
- 68.Presentment for payment of instrument payable at specified place and not elsewhere
- 69.Instrument payable at specified place
- 70.Presentment where no exclusive place specified
- 71.Presentment when maker, etc., has no known place of business or residence
- 72.Presentment of cheque to charge drawer
- 73.Presentment of cheque to charge any other person
- 74.Presentment of instrument payable on demand
- 75.Presentment by or to agent, representative of deceased, or assignee of insolvent
- 75A.Excuse for delay in presentment for acceptance or payment
- 76.When presentment unnecessary
- 77.Liability of banker for negligently dealing with bill presented for payment
CHAPTER VI OF PAYMENTAND INTEREST
CHAPTER VII OF DISCHARGE FROM LIABILITY ON NOTES, BILLS AND CHEQUES
- 82.Discharge from liability
- 83.Discharge by allowing drawee more than forty-eight hours to accept
- 84.When cheque not duly presented and drawer damaged thereby
- 85.Cheque payable to order
- 85A.Drafts drawn by one branch of a bank on another payable to order
- 86.Parties not consenting discharged by qualified or limited acceptance
- 87.Effect of material alteration
- 88.Acceptor or indorser bound notwithstanding previous alteration
- 89.Payment of instrument on which alteration is not apparent
- 90.Extinguishment of rights of action on bill in acceptor's hands
CHAPTER VIII OF NOTICE OF DISHONOUR
CHAPTER IX O F N O T I NG A N D P R O T E S T
CHAPTER X OF R E A S O N A B L E T I M E
CHAPTER XI OF ACCEPTANCE AND PAYMENT FOR HONOUR AND REFERENCE IN CASE OF NEED
- 108.Acceptance for honour
- 109.How acceptance for honour must be made
- 110.Acceptance not specifying for whose honour it is made
- 111.Liability of acceptor for honour
- 112.When acceptor for honour may be charged
- 113.Payment for honour
- 114.Right of payer for honour
- 115.Drawee in case of need
- 116.Acceptance and payment without protest
CHAPTER XII O F C O M P E N S A T I O N
CHAPTER XIII S P E C I A L R U L E S O F E V I D E N C E
CHAPTER XIV O F CROSSED C H E Q U E S
- 123.Cheque crossed generally
- 124.Cheque crossed specially
- 125.Crossing after issue
- 126.Payment of cheque crossed generally
- 127.Payment of cheque crossed specially more than once
- 128.Payment in due course of crossed cheque
- 129.Payment of crossed cheque out of due course
- 130.Cheque bearing “not negotiable”
- 131.Non-liability of banker receiving payment of cheque
- 131A.Application of Chapter to drafts
CHAPTER XV O F B I L L S I N S E T S
CHAPTER XVI O F I N T E R N A T I O N A L LA W
CHAPTER XVII OF PENALTIES IN CASE OF DISHONOUR OF CERTAIN CHEQUES FOR INSUFFICIENCY OF FUNDS IN THE ACCOUNTS
- 138.Dishonour of cheque for insufficiency, etc., of funds in the account
- 139.Presumption in favour of holder
- 140.Defence which may not be allowed in any prosecution under section 138
- 141.Offences by companies
- 142.Cognizance of offences
- 142A.Validation for transfer of pending cases
- 143.Power of Court to try cases summarily
- 143A.Power to direct interim compensation
- 144.Mode of service of summons
- 145.Evidence on affidavit
- 146.Bank’s slip prima facie evidence of certain facts
- 147.Offences to be compoundable
- 148.Power of Appellate Court to order payment pending appeal against conviction
Schedules and appendices
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