BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following is essential condition for constituting a person as holder of a negotiable instrument?
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He could not be payee of the instrument
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He could be an endorsee of the instrument
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He should have received the instrument not for consideration
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He has the right to get the possession of the instrument where the instrument is not in his possession
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Explanation:
Detailed explanation-1: -8. “Holder”.-The “holder” of a promissory note, bill of exchange or cheque means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto.
Detailed explanation-2: -The term Negotiable Instrument has been defined under section 13(1) of Negotiable Instrument Act, 1881. According to the Act, a negotiable instrument means a promissory note, bill of exchange or cheque payable either to order or to bearer.
Detailed explanation-3: -A crossed cheque can only be paid in account & hence it is not a negotiable instrument.
There is 1 question to complete.