CSEET · Business Laws and Management · Elements of Law relating to Negotiable Instruments
Under the Negotiable Instruments Act, 1881, which of the following is a negotiable instrument when it is payable either to order or to bearer?
A cheque is a negotiable instrument. The Act defines a negotiable instrument as a promissory note, bill of exchange or cheque payable to order or to bearer, and the other options are not among these three named instruments.
- AA bill of lading
- BA chequeCorrect
- CA share warrant
- DA letter of credit
Explanation
Section 13 defines a negotiable instrument as a promissory note, bill of exchange or cheque payable either to order or to bearer. A cheque is therefore covered. A bill of lading, share warrant and letter of credit are not named in the definition.
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