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Question
According to Negotiable Instruments Act, 1881, which of the following is not the type of promissory note?
According to Negotiable Instruments Act, 1881, which of the following is not the type of promissory note?
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Solution
The correct option is C A promises to pay the bearer
The term promissory means conveyance or implication of any promise. Under the Negotiable Instruments Act, 1881, Promissory notes are defined under section 4 of the Act as an instrument in writing 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.An instrument to be a promissory note must possess the following elements :- It must be in writing: Mere verbal promise to pay will not do. The method of writing is important, but it must be in a media that can not be altered easily.
- It must contain an express promise or clear undertaking to pay: A promise to pay cannot be inferred; it must be express. A mere acknowledgement is not enough.
- It must be definite.
The term promissory means conveyance or implication of any promise. Under the Negotiable Instruments Act, 1881, Promissory notes are defined under section 4 of the Act as an instrument in writing 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.
An instrument to be a promissory note must possess the following elements :
- It must be in writing: Mere verbal promise to pay will not do. The method of writing is important, but it must be in a media that can not be altered easily.
- It must contain an express promise or clear undertaking to pay: A promise to pay cannot be inferred; it must be express. A mere acknowledgement is not enough.
- It must be definite.
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