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Section 4 - Promissory Note : Negotiable Instruments Act 1881

 

 

What is Promissory Note? Promissory Note is defined under Section 4 of Negotiable Instruments Act 1881

Section 4 of Negotiable Instruments Act 1881: "Promissory Note"

A "promissory note" is an instrument in writing (not being a bank-note or a 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 instrument.

Illustrations

A signs instruments in the following terms:

(a) "I promise to Pay B or order Rs.500".

(b) "I acknowledge myself to be indebted to B in Rs.1,000, to be paid on demand, for value received."

(c) "Mr B I.O.U Rs.1,000."

(d) "I promise to pay B Rs. 500 and all other sums which shall be due to him."
 

 

(e) "I promise to pay B Rs. 500 first deducting there out any money which he may owe me."

(f) I promise to pay B Rs. 500 seven days after my marriage with C.

(g) I promise to pay B Rs. 500 on D's death, provided D leaves me enough to pay that sum.

(h) I promise to pay B Rs. 500 and to deliver to him my black horse on lst January next.

The instruments respectively marked (a) and (b) are promissory notes. The instruments respectively marked (c), (d), (e), (f), (g) and (h) are not promissory notes.

 

Negotiable Instruments Act 1881

CHAPTER II NOTES, BILLS AND CHEQUES

Section 4 - Promissory Note

Section 5 - Bill of exchange

Section 6 - Cheque

Section 7 - Drawer, Drawee

 

 

Section 8 - Holder

Section 9 - Holder in Due Course

Section 10 - Payment in due Course

Section 11 - Inland Instrument

Section 12 - Foreign Instrument

 

 

Section 13 - Negotiable Instrument

Section 14 - Negotiation

Section 15 - Endorsement

Section 16 - Endorsement in blank and in full endorsee

 

 

Section 17 - Ambiguous instruments

Section 18 - Where amount is stated differently in figures and words

Section 19 - Instruments payable on demand

Section 20 - Inchoate stamped instruments

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