Tag: bills of exchange and promissory note

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Multiple choice commercial applications banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks meaning, definition and characteristics of promissory note promissory note

For the purpose of attracting the provisions of section 138 of the Negotiable Instruments Act, 1881, a cheque has to be presented to the bank _____________________.

  1. Within a period of six months

  2. Within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier.

  3. Within a period of 15 days from the date on which it is drawn

  4. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Under the Negotiable Instruments Act, a cheque must be presented within its validity period, which is currently three months in India, or six months as per older statutory references often cited in textbooks.

Multiple choice commercial applications banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks meaning, definition and characteristics of promissory note promissory note

A cheque is drawn only on the bank in which the drawer has his account. But the bill of exchange can be drawn on _______________ including a ___________.

  1. any person; bank

  2. drawee; payee

  3. drawee: drawer

  4. payee: drawer
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A cheque is specifically drawn on a bank, whereas a bill of exchange is a more general instrument that can be drawn on any person, including a bank.

Multiple choice commercial applications banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks meaning, definition and characteristics of promissory note promissory note

Which one of the following is 'Not' the feature of a cheque?

  1. It is an unconditional written order by the maker to pay.

  2. The written order is to a specified bank.

  3. It specifies the amount to be paid in figures and words.

  4. None of the above.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

All listed options (unconditional order, specified bank, amount in figures/words) are standard features of a cheque. Therefore, none of the options are 'not' a feature.

Multiple choice commercial applications banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks meaning, definition and characteristics of promissory note promissory note

Crossing of a cheque effects the ___________________.

  1. Negotiability of the cheque

  2. Mode of payment on the cheque

  3. Both a and b

  4. Transferable but does not give a better title to the holder
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Crossing a cheque does not affect its negotiability (it can still be transferred), but it restricts the mode of payment by requiring it to be deposited into a bank account rather than paid over the counter.

Multiple choice commercial applications banking and bank transactions nature, advantages and types of cheques bills of exchange and promissory note meaning and types of banks meaning, definition and characteristics of promissory note promissory note

As per Negotiable Instrument Act $1881$ all of the following are types of the cheque EXCEPT:

  1. Bearer Cheques

  2. Order Cheques

  3. Crossed Cheques

  4. Blank Cheques
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Bearer, Order, and Crossed cheques are standard legal classifications under the Negotiable Instruments Act. A 'blank cheque' is a colloquial term for a signed cheque without an amount, not a formal legal category of cheque.