Skip to content

CSEET · Business Laws and Management · Elements of Law relating to Negotiable Instruments

Consider these statements about the conditions in the proviso to Section 138. I. The cheque must be presented within six months from its date or within its validity period, whichever is earlier. II. The drawer must be given fifteen days from receipt of the notice to pay. III. The payee must give notice within fifteen days of the bank's information about dishonour. Which statements are correct?

Statements I and II are correct. The cheque must be presented within six months or its validity, whichever is earlier, and the drawer has fifteen days after receiving the notice to pay. Statement III is wrong because the payee has thirty days, not fifteen, to give notice.

  1. AI and II onlyCorrect
  2. BII and III only
  3. CI and III only
  4. DI, II and III

Explanation

Statement I is correct as per clause (a) of the proviso, and II is correct as per clause (c). Statement III is wrong because the notice period was substituted from fifteen days to thirty days.

Did you get it right without looking?

One question tells you little. A timed set on Elements of Law relating to Negotiable Instruments shows your real accuracy, how long you take and where you lose marks.

Practise Elements of Law relating to Negotiable InstrumentsFree diagnostic mock

More Elements of Law relating to Negotiable Instruments questions