The negotiable instruments act, 1881 (Bare Act)/ Universal Law Publishing

THE NEGOTIABLE INSTRUMENTS ACT, 1881
Introduction
Preamble
CHAPTER I
PRELIMINARY
Sections
1. Short title Local extent^ saving of usages relating to Httndis, etc./ Commencement . . 3 3 3 2. [Repealed] 3. Interpretation clause ^ "Banker" ^ CHAPTER II
OF NOTES, BILLS AND CHEQUES
// 3 4. "Promissory note 5. "Bill of exchange" ^ -6.. "Cheque" ^ 7. "Drawer", "drawee" ^ "drawee in case of need" ^ "acceptor' "acceptor for honour" 5
"Payee"
8. "Holder' 9. "Holder in due course" ^ 10. "Payment in due course" 6 11. "Inland instrument" ^ 12. "Foreign instriunent" 13. "Negotiable instrument" 14. Negotiation
15. Indorsement 16. Indorsement "in blank" and "in full"—"Indorsee" 7 17. Ambiguous instruments ' 7 18. Where amount is stated differently in figures and words 7 19. Instruments payable on demand 7 20. Inchoate stamped instruments 7 21. "At sight", "On presentment", "After sight" 8 22. "Matiu-ity" ® Days of grace ® 23. Calculating matiuity of bill or note payable so many months after date or sight 8 24. Calculating maturity of bill or note payable so many days after date or sight ® 25. When day of maturity is a holiday 8
Ik

CHAPTER m
PARTIES TO NOTES, BILLS AND CHEQUES
Capacity to make, etc., promissory notes, etc.
Minor
Agency
Liabilit>' of agent signing
Liability of legal representative signing Liability of drawer Liability of drawee of cheque Liability of maker of note and acceptor of bill Ordy drawee can be acceptor except in need or for honour Acceptance by several drawees not partners
Liability of indorser
Liability of prior parKes to holder in due course Maker, drawer and acceptor principals Prior party a principal in respect of each subsequent party
Suretyship Discharge of indorser's liability Acceptor bound, although indorsement forged
Acceptance of bill drawn in fictitious name
Negotiable instrument made, etc., without consideration Partial absence or failure of money<onsideration Partial failure of consideration not consisting of money
Holder's right to duplicate of lost bill
CHAPTER fV
OF NEGOTIATION
Delivery . .
Negotiation by delivery .
Negotiation by indorsement
Conversion of indorsement in blank into indorsement in full
Effect of indorsement
Who may negotiate Indorser who excludes his own liability or makes it conditional
Holder deriving title from holder in due course
Ii^strument indorsed in blank Conversion of indorsement in blank into indorsement in full . r Indorsement for part of sum due Legal representative cjinnot by delivery only negotiate instrument indorsed by deceased Instrument obtained by unlawful means or for unlawful consideration Instrument acquired after dishonour or when overdue
Accommodation note or bill Instrument negotiable till payment or satisfaction •
CHAPTER V
OF PRESENTMENT
. Presentment for acceptance . Presentment of promissory note for sight

Drawee's time for deliberation
Presentment for payment
Hours for presentment Presentment for payment of instrument payable after date or sight. Presentment for payment of promissory note payable by instalments Presentment for payment of instrument payable at specified place
and not elsewhere Instrument payable at specified place Presentment where no exclusive place specified
Presentment when maker, etc., has no known place of
business or residence Presentment of cheque to charge drawer Presentment of cheque to charge any other person Presentment of instrument payable on demand Presentment by or to agent, representative of deceased, or assignee of insolvent Excuse for delay in presentment for acceptance or payment
When presentment unnecessary Liability of banker for negligently dealing with biU presented for payment
CHAPTER VI
OF PAYMENT AND INTEREST
To whom payment should be made Interest when rate specified Interest when no rate specified Delivery of instrument on payment or indemnity in case of loss .
CHAPTER VII
OF DISCHARGE FROM LIABILITY ON NOTES, BILLS AND CHEQUES
Discharge from liability
(a) By cancellation
(b) By release
(c) By payment Discharge by allowing drawee more than forty-eight hours to accept When cheque not duly presented and drawer damaged thereby Cheque payable to order Drafts drawn by one branch of a bank on another payable to order Parties not consenting discharged by qualified or limited acceptance
Effect of material alteration Alteration by indorsee Acceptor or indorser bound notwithstanding previous alteration Payment of instrument on which alteration is not apparent Extinguishment of rights of action on bill in acceptor's hands
CHAPTER VIII
OF NOTICE OF DISHONOUR
Dishonour by non-acceptance
Dishonour by non-payment By and to whom notice should be givbn Mode in which notice may be given

95. Party receiving must transmit notice of dishonour 24 96. Agent for presentment 97. When party to whom notice given is dead 24 98. When notice of dishonour is urmecessary 24 CHAPTER IX
OF NOTING AND PROTEST
99. Noting
100. Protest Protest for better security 24 101. Contents of protest 25 102. Notice of protest 25 103. Protest for non-payment after dishonour by non-acceptance 25 104. Protest of foreign bills 25 104A. When noting equivalent to protest 25 CHAPTER X
OF REASONABLE TIME
105. Reasonable time 26 106. Reasonable time of giving notice of dishonour 26 107. Reasonable time for transmitting such notice 26 - - CHAPTER XI
OF ACCEPTANCE AND PAYMENT FOR HONOUR AND
REFERENCE IN CASE OF NEED
108. Acceptance for honour 26 109. How acceptance for honour must be made 26 110. Acceptance not specifying for whose honour it is made 26 111. Liability of acceptor for honour 26 112. When acceptor for honour may be charged 27 113. Payment for honoiu 27 114. Right of payer for honour 27
115. Drawee in case of need • 27 116. Acceptance and payment without protest V, 27
CHAPTER XII
OF COMPENSATION
117. Rules as to compensation 27
CHAPTER XIII
SPECIAL RULES OF EVIDENCE
118. Presumptions as to negotiable instruments 28
(a) of consideration 28
(b) as to date 28 (c) as to time of acceptance 28
(d) as to time of transfer 28
(e) as to order of indorsements 28 (f) as to stamps 28 (g) that holder is a holder in due course 28 119. Presumption on proof of protest 29 120. Estoppel against denying original validity of instnunent 29 121. Estoppel agamst denying capacity of payee to indorse 29 122. Estoppel agairvst denying signature or capacity of prior party 29

CHAPTER XIV
OF CROSSED CHEQUES
Cheque crossed generally Cheque crossed specially
Crossing after issue Payment of cheque crossed generally Payment of cheque crossed specially Payment of cheque crossed specially more than once Payment in due course of crossed cheque Payment of crossed cheque out of due course Cheque bearing "not negotiable" Non-liability of banker receiving payment of cheque Application of Chapter to drafts
CHAPTER XV
OF BILLS IN SETS
Set of bills Holder of first acquired part entitled to all • •
CHAPTER XVI
OF INTERNATIONAL LAW Law governing liability of maker, acceptor or indorser of foreign instrument 135. Law of place of payment governs dishonour 136. Instrument made, etc., out of India, but in accordance with the law of India 137. Presumption as to foreign law
CHAPTER XVII
OF PENALTIES IN CASE OF DISHONOUR OF CERTAIN CHEQUES FOR INSUFFICIENCY OF FUNDS IN THE ACCOUNTS 138. Dishonour of cheque for insufficiency, etc., of funds in the account. 139. Presumption in favour of holder 140. Defence which may not be allowed in any prosecution under section 138.
141. Offences by companies
142. Cognizance of offences 143. Power of Court to try cases summarily 'j,
144. Mode of service of summons
145. Evidence on affidavit 146. Bank's slip prima fade evidence of certain facts
147. Offences to be compoimdable SCHEDULE.—[Repealed]
MODEL FORMS OF NOTICE AND COMPLAINT FOR DISHONOUR OF CHEQUES
RECENT CASE LAW ON DISHONOUR OF CHEQUES RBI CIRCULAR REGARDING DISHONOUR OF CHEQUE
FOR SCHEDULED BANKS , .
FORM OF COMPLAINT (TO BE LODGED) WITH
THE BANKING OMBUDSMAN
ADDRESS OF THE OFFICES OF BANKING OMBUDSMAN
ALONGWITH AREA OF OPERATION