Question

"I promise to pay Mr. Amit or Order Rs 1,500" is promissory note.

• A. True
• B. False
• C. It is a bill of exchange
• D. It is a cheque

Answer 1

Answer: (A)

True

According to section 4 of the Negotiable instruments Act, 1881, promissory note means 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. Here the person has undertaken to pay Amit without any condition or order Rs 1,500 and hence fulfill all the elements of promissory note as per the act.