Sections 21 and 22 of Negotiable Instruments Act 1881: At Sight, After Sight and Maturity
Sections 21 and 22 of the Negotiable Instruments Act, 1881 explain expressions used to determine when a promissory note or bill of exchange becomes payable. Section 21 defines "at sight", "on presentment" and "after sight". Section 22 defines maturity and provides the statutory rule for days of grace.
Section 21: At Sight, On Presentment and After Sight
Section 21: In a promissory note or bill of exchange, the expressions "at sight" and "on presentment" mean on demand. The expression "after sight" means, in a promissory note, after presentment for sight and, in a bill of exchange, after acceptance, or noting for non-acceptance, or protest for non-acceptance.
Meaning of At Sight and On Presentment
For a promissory note or bill of exchange, Section 21 gives "at sight" and "on presentment" the meaning "on demand". This provision should be read with Section 19, which provides that a promissory note or bill of exchange in which no time for payment is specified, and a cheque, are payable on demand.
Meaning of After Sight
For a promissory note, "after sight" means after presentment for sight. For a bill of exchange, it means after acceptance, or noting for non-acceptance, or protest for non-acceptance. The distinction matters when the payment period is stated to run for a specified period after sight.
Section 22: Meaning of Maturity
Section 22: The maturity of a promissory note or bill of exchange is the date at which it falls due. Every promissory note or bill of exchange which is not expressed to be payable on demand, at sight or on presentment is at maturity on the third day after the day on which it is expressed to be payable.
What Are Days of Grace?
Section 22 provides three days of grace for a promissory note or bill of exchange that is not expressed to be payable on demand, at sight or on presentment. Accordingly, its statutory maturity occurs on the third day after the day on which the instrument is expressed to be payable.
The rule on days of grace must be applied together with the succeeding provisions dealing with calculation of maturity and holidays. Section 23 deals with instruments payable a stated number of months after date or sight, Section 24 deals with instruments payable a stated number of days after date or sight, and Section 25 addresses the situation where the day of maturity is a public holiday.
Difference between Payable on Demand and Maturity with Days of Grace
An instrument payable on demand, at sight or on presentment does not receive the three days of grace described in Section 22. The days-of-grace rule applies to a promissory note or bill of exchange that is not expressed to be payable in any of those ways.
Related Definitions and Provisions
A promissory note is defined in Section 4, a bill of exchange in Section 5, and a cheque in Section 6. These definitions provide the statutory context for Sections 21 and 22.
Official legal text: The current text of the Negotiable Instruments Act, 1881 can be checked on the official India Code portal maintained by the Government of India.