BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A bill of exchange is an instrument in writing
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A bill of exchange may be drawn conditionally
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A bill of exchange directs a certain person to pay certain amount of money
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A. A bill of exchange is payable to the order of a certain person or to the bearer of the instrument as per NI Act
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Detailed explanation-1: -Detailed Solution. The incorrect statement is The drawer and the payee can never be the same.
Detailed explanation-2: -The acceptance must also be unconditional. Conditional acceptance is equivalent to non-acceptance. However there can be the case where he does not accept and this is called ‘dishonour of the bill by non-acceptance’.
Detailed explanation-3: -Bill of exchange is unconditional as it contains a written order by the drawer to the drawee, signed by drawer, and requires the drawee to pay on demand, or at a fixed or determinable future time, a sum certain in money to, or to the order of, a specified person (the payee) or to the bearer.
Detailed explanation-4: -A bill of exchange must be in writing. It must be dated and stamped. It has three parties: Drawer, Drawee and Payee. It must be signed by the maker or drawer and payee can also be drawer or vice-versa.
Detailed explanation-5: -A bill of exchange has many features such as, it is in writing, the order to make payment is unconditional, must be payable to bearer, has grace period, must be stamped as per the requirement of law, etc. Crossing is not necessary for a bill of exchange.