LAWS RELATED TO BILL FINANCE
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One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What is a Bill of Exchange as defined under the Negotiable Instruments Act, 1881?
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 only to or to the order of a certain person or to the bearer of the instrument.
Under which Act are Bills of Exchange primarily governed in India?
Negotiable Instruments Act, 1881 governs Bills of Exchange.
Who are the three parties typically involved in a Bill of Exchange?
The three parties are the Drawer (who draws the bill), the Drawee (on whom the bill is drawn and who must pay), and the Payee (who receives the payment).
What is the maximum 'Days of Grace' allowed on a usance bill under the NI Act?
Three days of grace are allowed under NI Act.
What is the meaning of 'acceptance' in the context of a Bill of Exchange?
Acceptance is the signification by the drawee of his assent to the order of the drawer, typically done by signing across the face of the bill, thereby making the drawee the acceptor and primarily liable for payment.
What is 'bill in sets' commonly used in foreign trade?
A bill issued in duplicate or triplicate for safety in transit.
What is a Demand Bill in the context of bill finance?
A Demand Bill (also called a sight bill) is payable on presentment or on demand, meaning the drawee must pay immediately when the bill is presented to him.
What does the term 'drawee in case of need' mean on a Bill of Exchange?
A person named to accept the bill if original drawee refuses.
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