BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -The cheque is an unconditional order and not a request to the bank. The cheque carries validity only when it is signed and dated. The unsigned cheques are invalid. The Cheques are usually valid from the day they are dated. Usually, the cheques longer than six months from the date mentioned are called stale cheques.

Detailed explanation-2: -payment made by a negotiable instrument is a conditional payment, a cheque once issued, unless dishonoured, is payment.

Detailed explanation-3: -THE NEGOTIABLE INSTRUMENTS ACT, 1881. 5. “Bill of exchange”.-A “bill of exchange” is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument.

Detailed explanation-4: -An order cheque is a cheque where only the person or party in whose name the cheque has been drawn, can withdraw the cash. The person collecting the cheque has to give an identity proof to encash the cheque.

Detailed explanation-5: -(1) A “negotiable instrument” means a promissory note, bill of exchange or cheque payable either to order or to bearer.