Which of the following is a Negotiable Instrument? A) Promissory Note B) Cheque C) Bill of Exchange D) All of the above

All the options, i.e., promissory note, cheque and bill of exchange, are negotiable instruments.

What does the Negotiable Instruments Act of 1881 mean?

The Negotiable Instruments Act of 1881 regulates all forms of negotiable currency, including cheques, bills of exchange, and promissory notes. A “negotiable instrument” is a piece of paper that can be transferred from one person to another.

Is a promissory note the same as a bill of exchange?

Written agreements between two parties that prove a financial transaction has been agreed upon include bills of exchange and promissory notes. Promissory notes are more frequently used in domestic trade than in international trade, which uses bills of exchange more frequently.

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Which of the following is a Negotiable Instrument?

By BYJU'S Exam Prep

Updated on: September 13th, 2023

A) Promissory Note

B) Cheque

C) Bill of Exchange

D) All of the above

The negotiable instrument is all the given options, i.e., promissory note, cheque, and bill of exchange. A negotiable instrument is a piece of paper that, following the Negotiable Instrument Act of 1881, entitles a person to a quantity of money and is transferable from one person to another. A negotiable instrument is an instrument that cannot be negotiable unless such and in such a state that the true owner could transfer the contract or engagement contained therein by simply delivering the instrument. This is because property in such an instrument is acquired by anyone who takes it honestly and for value, regardless of any title defect in the person from whom he took it.

Table of content

1. What are Negotiable Instruments?

What are Negotiable Instruments?

The meaning of “Negotiable Instruments” is the exchange or give and take of documents from one person to another. An instrument could not be negotiable unless such and in such a state that the true owner could transfer the contract or engagement contained by simply delivering the instrument. According to the definition, it is an instrument, the property in which is acquired by anyone who takes it bona fide, and for value, notwithstanding any defect of title in the person from whom he took it.

Characteristics of the Negotiable Instruments Act, 1881:

The Negotiable Instruments Act of 1881 regulates all forms of negotiable currency, including checks, bills of exchange, and promissory notes. A
egotiable instrument is a piece of paper that can be transferred from one person to another.

The property contained in the instrument is assumed to belong to the person holding it.
They can be freely moved.
A holder in good standing receives the instrument free of all title defects of any prior holder.
In due course, the holder has the right to bring a claim against the instrument in his own name.
The instrument can be transferred until it matures, or in the case of checks, until it expires (on the expiry of 6 months from the date of issue).
Unless the contrary is proven, certain equal presumptions apply to all negotiable instruments.

☛ Related Questions:

Which of the following is a Negotiable Instrument?

What are Negotiable Instruments?

Characteristics of the Negotiable Instruments Act, 1881:

FAQs on Negotiable Instruments