Section 5 - Bill of exchange : Negotiable Instruments Act 1881
What is Bill of exchange? Bill of exchange is defined under Section
5 of Negotiable Instruments Act 1881
Section 5 of Negotiable Instruments Act 1881: "Bill of exchange"
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.
A promise or order to pay is not "conditional"
within the meaning of this section and section 4, by
reason of the time for payment of the amount or any
installment thereof being expressed to be on the
lapse of a certain period after the occurrence of a
specified event which, according to the ordinary
expectation of mankind, is certain to happen,
although the time of its happening may be uncertain.
The sum payable may be "certain", within the meaning
of this section and section 4, although it includes
future interest or is payable at an indicated rate of
exchange, or is according to the course of exchange, and
although the instrument provides that, on default of
payment of an installment, the balance unpaid shall
The person to whom it is clear that the direction is given or
that payment is to be made may be "certain person", within the
meaning of this section and section 4, although he is misnamed
or designated by description only.