Meaning of Negotiable Instrument – Negotiable’ means transferable by delivery, and ‘instrument’ is a written document which creates a right in favour of any person. Therefore, a negotiable instrument is a written document which creates a right in favour of any person and which is transferable by delivery.
Definition: A negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or to bearer -Section 13
Characteristics of Negotiable Instrument
| 1 | It is a written document. |
| 2 | A negotiable instrument payable to bearer is transferable merely by delivery, whereas a negotiable instrument payable to order is transferable by endorsement and delivery. |
| 3 | The holder of a negotiable instrument can sue upon it in his own name. |
| 4 | The consideration is not mentioned on the negotiable instrument. It is presumed that the negotiable instrument has been drawn for a valuable consideration. |
| 5 | It works in the same manner as money and, like money, it may also be transferred from one person to another. |
| 6 | The transferor does not need to give notice to any person at the time of transferring the instrument. |
| 7 | It is the simplest and most convenient mode of assignment of a debt. |
| 8 | The title to the instrument received by a bonafide transferee is not affected by any defect in the title of the transferor. |
Disclaimer – If you need more pdf files, notes or book, then you can email us. Email has been given up. We will be able to help you as soon as possible. Please do not hesitate and mail us. You can also get assistance on social media especially on Facebook or Whatsapp. Our email address is pdffiles.in@gmail.com, You can send message on whatsapp. Our whatsapp number is +91 7876021500 and for facebook user Click Here.
Leave a Comment