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17 June 2012
CHARACTERS OF Negotiable Instrument1-Tranferbility. 2-Negotiability 3-Holder can recover &/ sue the parties there of.
17 June 2012
an unconditional undertaking signed by the maker Promissory to Pay a certain sum of amount ,to certain person on certain date is called as Promissory note note
Sec. 4
Promissory note
I Pyare lal s/o Sh. Ram Lal promise to pay a sum of Rs.1000/-to Raj Kumar or order on 16.02.2010.
Beneficiary
Certain sum Certain Date
Pyare Lal
Maker
BANK OF BARODA
Bill of Exchange is an instrument in writing containing an unconditional Sec.5 order by the maker directing a certain person to pay a certain sum of amount Bill of Exchange only to or to the order of, a certain person or to the bearer of the instrument
M / S Raj Kumar & CO. Pay M/S Pyare lal & company or Order
Drawee Payee
on
Certain amount
Certain Date
Drawer
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BANK OF BARODA
A Cheque is a bill of exchange drawn on a specific banker and not expressed to be payable otherwise on demand Cheque Sec.6 it includes the electronic image of a truncated cheque and a cheque in electronic form.
Drawee bank
Payee
Date 16.11.2009
or bearer
Drawer
Proprietor
5
BANK OF BARODA
Sec.08
HOLDER Holder means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties there to. Where the NI is lost or destroyed, its holder is the person so entitled at the time of such loss or destruction
HOLDER
HOLDER
BANK OF BARODA
Sec 9
A person who for consideration becomes the possessor of the NI if payable to bearer, or payee or endorsee, if payable to order, before amount mentioned in it becomes payable, and without having sufficient cause to believe that any defect exists in the title of the person from whom he derived his title. Holder in due course
Please have this cheque for the furniture I have bought from you
Dated 16.11.09 Pay Raj Kumar or bearer Rs. Ten thousand only Rs.10000/-
PQR Bank
Sanjeev Kumar Lucknow Sanjeev Kumar
Raj Kumar
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or Order
XYZ Bank
Lucknow
Director
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2 2.In good faith & without negligence to any person in possession thereof
Banker
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under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of amount
Presenter
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Banker
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Sec.14:-when Negotiable instruments is TRANSFERRED to any person so as to constitute him as HOLDER thereof the instrument , said to be negotiated.
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When a promissory note, Bill of Exchange or cheque is transferred to any Sec.14 person, so as to constitute the person the HOLDER thereof, the instrument Negotiation is said to be Negotiated. This process is called as Negotiation
Dated 16.11.09 Pay Raj Kumar or bearer Rs. Ten thousand only PQR Bank Rs.10000/Sanjeev Kumar
Lucknow
Sanjeev Kumar Raj Kumar
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Sec.46
DELIVERY
Pay Raj Kumar Rs. Ten thousand only
Negotiation by Delivery
Rs.10000/-
Sanjeev Kumar
Shyaam Shyam
14
Section 15 ENDORSEMENT
Sec.15- Endorsement
Date 16.02.2009 When the maker or the holder of a NI signs the same, other wise than such a maker ,for the purpose of the negotiation on the back or the face thereof or on a slip of paper annexed thereto, he is said to Endorsed the same and is called the Endorser Sec.16 Blank Endorsement
Raj Kumar
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Sec.16SeSE
Pay to Ramesh
Endorser
Shyam Kumar
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Sec.48
Negotiation by Endorsement
1 Endorsement 2 Delivery
ENDORSEMENT Delivery
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Sec.49
Blank endorsement
Pay to Sushil
RAJKUMAR
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A
C E B A C K
Restricted Endorsement
Raj Kumar
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Effect of endorsementSec.50
1- Transfer the property therein to the endorsee,
Sec-18 Sec-18- Where the Amount in words & figure differs- the amount in words shall be the amount undertaken / ordered to be paid . If- amount in words is there ,but not in figures If amount in figures is there, but not in words-
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Any material alternation (that adversely affect the interest of the parties can be called material alternation ) renders void as against any one who is party there to .
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Sec.123
Crossing of cheque
Where a cheque bears across its face an addition of the word and company or any abbreviation thereof, between two parallel transverse lines or of two parallel lines simply, either with or without the word not negotiable , that addition shall be deemed as a crossing and the cheque shall be deemed to be crossed cheque.
/-
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Sec.124
Special Crossing
Where a cheque bears across its face an addition of the name of a banker , either with or without the words not negotiable , that addition shall be deemed as a crossing and the cheque shall be deemed to be crossed specially and to crossed to that banker.
/-
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Sec.125
Where a cheque is crossed generally Where a cheque is crossed generally or specially The holder may add the words not negotiable
Sec.126
Where a cheque crossed specially , the banker on whom it is drawn shall not pay it other wise than to the banker on whom it is crossed, or his agent for collection
Bank of India
/-
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Sec.126
/ Please make payment Sorry , this cheque cannot be paid over counter
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Sec.127
Where a cheque crossed specially , to more than one banker, except when crossed to an agent for the purpose of collection ,the banker on whom it is drawn shall refuse payment thereof.
Bank of India
/-
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Sec.126
/ Please make payment Sorry , this cheque cannot be paid over counter
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Sec.128
Where the banker on whom a crossed cheque is drawn has paid the same in due course, the banker paying the cheque, and the drawer thereof, shall respectively be entitled to the same rights, and be placed in the same position in all respect, as they would be respectively entitled to and place in if the amount of cheque had been paid to and received by the true owner of cheque.
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Sec.129
Any banker paying a cheque crossed generally other wise than to a banker, or a cheque crossed specially otherwise than to the banker to whom the same is crossed, or his agent for collection, being a banker , shall be liable to the true owner of the cheque for any loss he may sustain owing to the cheque having been so paid.
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Sec 130
A person taking a cheque crossed generally of specially, bearing in either case the words not negotiable, shall not have and shall not be capable of giving , a better title to the cheque than that which the person from whom he took .it had
not negotiable
Sec.131
Collection of a cheque for a Customer,
Here customer means duly introduced / KYC compliant customer. It should be crossed before coming in the hands of the banker, When electronic image of the cheque is being sent for collection, then verify the prima facie genuineness of the cheque to be truncated
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Sec.138
Cheque is issued for the discharge of any debt or other liability, Amount of the cheque is more than the
Amount held in the account on which the cheque is drawn, Arrangement made by the drawer in the account maintained with the bank.
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Primary duty of drawer of cheque is to make payment to the payee . Sec142( b)- Legislative opportunity- notice of dishonour of cheque with demand to pay exact cheque amount ( not more / interest etc ) to be brought to the drawer, within one month from return of cheque .. If he makes no attempts to repay within 15 days , a case may be filed in court of law ( not below first class magistrate ) , within 1 month period . Court may pardon one month limitation. Sec-139- It is presumed that ch. Is issued for payment of debt .
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Starting point of limitation under Sec 138 of NI act will begin to run on the day next to the day on which notice has been effected ( receipt of information ).
The limitation to file complaint under sec142(b) is one month (calendar month ) starts from 16th day after receipt of notice of dishonour.
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Sec.139
It is a criminal offence,
Drawer of the cheque can be punished WITH
1-)with imprisonment for a term which may be OR extended to two years
2-FINE which may extend to twice of the amount of OR the cheque endeavor BOTH
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Sec-142 1-Court will take cognizance of offence punishable under sec-138 if complaint is made in writing , by payee / holder in due course . 2- Within 1 month of the date on which cause of action arises. 3- Summary trial 4-Stop payment Complaint is maintainable.
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Sec-144- Summons issued to at the place ordinarily resides or carries business by post ,courier is valid summon served . Sec-145- Evidence on affidavit. Sec-146- Banks return memo (slip )is the prima facie evidence of certain facts . Sec-147- Under CPC ( code of criminal procedure-1973) every offence punishable under this act is compoundable .
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THANKS
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