Multiple choice

A bank is under obligation to make payment of cheque issued by its customer under Negotiable Instruments Act, 1881. Which of the following conditions is incorrect regarding the payment of cheque?

  1. The parties must be certain.

  2. The funds must be properly available for payment of the said cheque.

  3. The signatures of the customer should be as per the records of the bank.

  4. Cheque should be drawn in one ink, one handwriting and one script
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Negotiable Instruments Act states that a cheque should have the following characteristics: (1) It must be in writing (2) It must contain an unconditional order to pay money only and not merely a request (3) It must be signed by the drawer (4) The parties must be certain (5) The sum payable must also be certain (6) It must comply with other formalities e.g. stamps, date etc Thus, option 4 is the correct answer.

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