Section 99 and Section 100 of Negotiable Instruments Act 1881: Noting and Protest
Sections 99 and 100 of the Negotiable Instruments Act, 1881 form part of Chapter IX, dealing with noting and protest. They provide a statutory method by which the dishonour of a promissory note or bill of exchange may be formally recorded and, in the case of a protest, certified by a notary public.
For the current text of the Act, see the Negotiable Instruments Act, 1881 on India Code.
Section 99 - Noting
Meaning of noting: Noting is the formal recording by a notary public of the dishonour of a promissory note or bill of exchange. The statutory note records specified particulars relating to the dishonour.
What Section 99 provides
Where a promissory note or bill of exchange is dishonoured by non-acceptance or non-payment, the holder may have the dishonour noted by a notary public on the instrument, on a paper attached to it, or partly on each.
The note must be made within a reasonable time after dishonour. It must specify the date of dishonour; the reason assigned for dishonour, if any; or, where the instrument has not been expressly dishonoured, the reason why the holder treats it as dishonoured; and the notary's charges.
Essential elements of Section 99
The provision applies to a promissory note or bill of exchange dishonoured by non-acceptance or non-payment. The holder may obtain noting from a notary public, and the noting must be completed within a reasonable time. The contents required by Section 99 help create a formal record of the dishonour and its circumstances.
Section 100 - Protest
Meaning of protest: A protest is the certificate made by a notary public after the dishonour of a promissory note or bill of exchange has been noted and certified in accordance with Section 100.
What Section 100 provides
When a promissory note or bill of exchange has been dishonoured by non-acceptance or non-payment, the holder may, within a reasonable time, cause the dishonour to be noted and certified by a notary public. The resulting certificate is called a protest.
Protest for better security
Section 100 also deals with a protest for better security. If, before maturity of a bill of exchange, its acceptor becomes insolvent or the acceptor's credit is publicly impeached, the holder may within a reasonable time have a notary public demand better security from the acceptor. If that security is refused, the holder may within a reasonable time have those facts noted and certified. The certificate is called a protest for better security.
Difference between noting and protest
Under Section 99, noting is the notary public's formal record of the dishonour and the particulars required by the section. Under Section 100, a protest is the notarial certificate of the dishonour after it has been noted and certified. Section 100 separately recognizes a protest for better security before maturity where the statutory conditions concerning the acceptor are satisfied.
Related provisions
Sections 99 and 100 should be read with the other provisions in Chapter IX of the Negotiable Instruments Act, 1881 concerning noting and protest, as applicable to the particular instrument and circumstances.