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CMA Foundation · Fundamentals of Business Laws and Business Communication · Negotiable Instruments Act, 1881

Ramesh, a holder, could not present a bill for payment on time because a flood cut off all roads to the drawee's town. The flood has now subsided. What must Ramesh do under the Act?

Ramesh must present the bill within a reasonable time after the flood, the cause of delay, ceases to operate. His delay is excused because it was beyond his control, but he cannot postpone presentment indefinitely once the obstacle is gone.

  1. APresent the bill within a reasonable time after the cause of delay ceases to operateCorrect
  2. BPresent it only after the next due date of the bill
  3. CTreat the bill as automatically discharged
  4. DWait until the drawee approaches him

Explanation

Delay caused by circumstances beyond the holder's control, such as a flood, is excused. But when the cause ceases, presentment must be made within a reasonable time. The bill is not discharged and he need not wait.

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