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A promissory note made payable 'to bearer':
AIs valid only if payable on demand
BCannot be made — only the RBI or the Central Government may issue a promissory note payable to bearer
CIs perfectly valid
DIs treated as a cheque
Answer & Solution
Correct answer: B. Cannot be made — only the RBI or the Central Government may issue a promissory note payable to bearer
Under Section 31 of the RBI Act, only the Reserve Bank or the Central Government may issue a promissory note payable to bearer; an ordinary maker cannot.
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