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CA Foundation Negotiable Instruments Act 1881 — practice questions

Explore 90 free Negotiable Instruments Act 1881 questions in CA Foundation Businesslaw. Open each question or exercise to read its content, reference answers and available explanation.

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Negotiable Instruments Act 1881 questions and exercises with answers

Showing questions 1–30 of 90.

An instrument in writing with an unconditional undertaking by its maker to pay a sum is a:Read the answer and worked solution →A written unconditional order directing a certain person to pay a sum is a:Read the answer and worked solution →A cheque differs from an ordinary bill of exchange as it is drawn on a:Read the answer and worked solution →The maker of a bill of exchange or cheque is called the:Read the answer and worked solution →The person directed by a bill of exchange to pay the money is the:Read the answer and worked solution →After the drawee signs his assent upon the bill and delivers it, he is called the:Read the answer and worked solution →The person named in a negotiable instrument to whom payment is directed is the:Read the answer and worked solution →If a cheque is lost or destroyed, its holder is the person entitled at the:Read the answer and worked solution →A holder in due course must have become possessor of the instrument:Read the answer and worked solution →Payment in due course is made according to the apparent tenor in:Read the answer and worked solution →A cheque drawn in India and payable in India is deemed to be a(n):Read the answer and worked solution →Section 13 requires a negotiable instrument to be payable:Read the answer and worked solution →Which set lists all the instruments named in Section 13 as negotiable?Read the answer and worked solution →An instrument payable to a named person, with no bar on transfer, is payable:Read the answer and worked solution →An instrument whose last indorsement is in blank becomes payable:Read the answer and worked solution →A negotiable instrument may be made payable to two or more payees:Read the answer and worked solution →A transfer that makes the transferee the holder of an instrument is called:Read the answer and worked solution →Signing an instrument, other than as maker, for the purpose of negotiation is:Read the answer and worked solution →An indorser who signs only his name makes an indorsement:Read the answer and worked solution →If an instrument can be read as a promissory note or a bill, the holder may:Read the answer and worked solution →If the amount in figures differs from the amount in words, which prevails?Read the answer and worked solution →A promissory note or bill that specifies no time for payment is payable:Read the answer and worked solution →In a promissory note or bill, 'at sight' and 'on presentment' mean:Read the answer and worked solution →A time bill falls due on which day after the date it is expressed payable?Read the answer and worked solution →If a bill matures on a public holiday, it is deemed due on the:Read the answer and worked solution →A promissory note dated 30 August is payable three months after date. It matures on:Read the answer and worked solution →A minor who draws or indorses a negotiable instrument binds:Read the answer and worked solution →An agent who signs a cheque without stating he signs as agent is:Read the answer and worked solution →Does a general authority to transact business empower an agent to indorse bills?Read the answer and worked solution →A bank holding the drawer's sufficient funds applicable to a cheque must:Read the answer and worked solution →

Worked practice questions

An instrument in writing with an unconditional undertaking by its maker to pay a sum is a:

  1. A bank cheque
  2. A hundi of trade
  3. Promissory note
  4. Bill of exchange
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Correct answer: C. Promissory note

A written, signed, unconditional promise by the maker to pay a certain sum to a certain person or bearer is what Section 4 calls a promissory note.

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A written unconditional order directing a certain person to pay a sum is a:

  1. A bank deposit slip
  2. A simple receipt
  3. Bill of exchange
  4. Promissory note
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Correct answer: C. Bill of exchange

Section 5 defines a bill of exchange as a signed written order, not a promise, directing a named person to pay a certain sum.

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A cheque differs from an ordinary bill of exchange as it is drawn on a:

  1. Named merchant
  2. Notary public
  3. Specified banker
  4. Registered company
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Correct answer: C. Specified banker

Section 6 treats a cheque as a bill of exchange drawn on a specified banker and payable on demand.

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