NEGOTIABLE INSTRUMENTS ACT, 1881

[Act No. 26 of Year 1881, dated 9-12-1881]

An Act to define the law relating to promissory notes, bills of exchange and cheques. Whereas it is expedient to define and amend the law relating to promissory notes, bills of exchange and cheques; It is hereby enacted as follows: -

PRELIMINARY 1. Short tit e This Act may be called the Neg tiable I!st"#me!ts Act, 1881$ L cal e%te!t, sa&i!g ' #sage "elati!g t h#!dis, etc$, c mme!ceme!t( It e%te!ds 1t )*the +h le ' I!dia ,*- - -../ b#t ! thi!g he"ei! c !tai!ed a''ects the 0*I!dia! 1a2e" C#""e!cy Act, 1831 4, ' 18315., secti ! )1, " a''ects a!y l cal #sage "elati!g t a!y i!st"#me!t i! a! "ie!tal la!g#age( 1RO6I7E7 that s#ch #sages may be e%cl#ded by a!y + "ds i! the b dy ' the i!st"#me!t, +hich i!dicate a! i!te!ti ! that the legal "elati !s ' the 2a"ties the"et shall be g &e"!ed by this Act/ a!d it shall c me i!t ' "ce ! the 'i"st day ' Ma"ch, 188)$ 2. Re!ea of e"act#e"t$ *Re2$ by the Ame!di!g Act, 1881 41) ' 18815, sec$ ) a!d Sch$ I, 2a"t I$. %. I"ter!retatio" c a&$e I! this Act9 :*- - -. ;Ba!<e"; ( =*;ba!<e"; i!cl#des a!y 2e"s ! acti!g as a ba!<e" a!d a!y 2 st ''ice sa&i!gs ba!<.$ 3*---. '( N')ES, *ILLS AN+ ,-E./ES 0. 1Pro#i$$or2 "ote1 A ;2" miss "y ! te; is a! i!st"#me!t i! +"iti!g 4! t bei!g a ba!<9! te " a c#""e!cy9! te5 c !tai!i!g a! #!c !diti !al #!de"ta<i!g sig!ed by the ma<e", t 2ay a ce"tai! s#m ' m !ey !ly t , " t the "de" ', a ce"tai! 2e"s !, " t the bea"e" ' the i!st"#me!t$

I &$tratio"$ A sig!s i!st"#me!ts i! the ' ll +i!g te"ms( 4a5 ;I 2" mise t 1ay B " "de" Rs$:>>;$ 4b5 ;I ac<! +ledge mysel' t be i!debted t B i! Rs$1,>>>, t be 2aid ! dema!d, ' " &al#e "ecei&ed$; 4c5 ;M" B I$O$U Rs$1,>>>$; 4d5 ;I 2" mise t 2ay B Rs$ :>> a!d all the" s#ms +hich shall be d#e t him$; 4e5 ;I 2" mise t 2ay B Rs$ :>> 'i"st ded#cti!g the"e #t a!y m !ey +hich he may +e me$; 4'5 I 2" mise t 2ay B Rs$ :>> se&e! days a'te" my ma""iage +ith C$ 4g5 I 2" mise t 2ay B Rs$ :>> ! 7?s death, 2" &ided 7 lea&es me e! #gh t 2ay that s#m$ 4h5 I 2" mise t 2ay B Rs$ :>> a!d t deli&e" t him my blac< h "se ! lst @a!#a"y !e%t$ The i!st"#me!ts "es2ecti&ely ma"<ed 4a5 a!d 4b5 a"e 2" miss "y ! tes$ The i!st"#me!ts "es2ecti&ely ma"<ed 4c5, 4d5, 4e5, 4'5, 4g5 a!d 4h5 a"e ! t 2" miss "y ! tes$ 3. 1*i of e4cha"5e1 A ;bill ' e%cha!ge; is a! i!st"#me!t i! +"iti!g c !tai!i!g a! #!c !diti !al "de", sig!ed by the ma<e", di"ecti!g a ce"tai! 2e"s ! t 2ay a ce"tai! s#m ' m !ey !ly t , " t the "de" ', a ce"tai! 2e"s ! " t the bea"e" ' the i!st"#me!t$ A 2" mise " "de" t 2ay is ! t ;c !diti !al; +ithi! the mea!i!g ' this secti ! a!d secti ! 0, by "eas ! ' the time ' " 2ayme!t ' the am #!t " a!y i!stalme!t the"e ' bei!g e%2"essed t be ! the la2se ' a ce"tai! 2e"i d a'te" the cc#""e!ce ' a s2eci'ied e&e!t +hich, acc "di!g t the "di!a"y e%2ectati ! ' ma!<i!d, is ce"tai! t ha22e!, alth #gh the time ' its ha22e!i!g may be #!ce"tai!$ The s#m 2ayable may be ;ce"tai!;, +ithi! the mea!i!g ' this secti ! a!d secti ! 0, alth #gh it i!cl#des '#t#"e i!te"est " is 2ayable at a! i!dicated "ate ' e%cha!ge, " is acc "di!g t the c #"se ' e%cha!ge, a!d alth #gh the i!st"#me!t 2" &ides that, ! de'a#lt ' 2ayme!t ' a! i!stalme!t, the bala!ce #!2aid shall bec me d#e$ The 2e"s ! t +h m it is clea" that the di"ecti ! is gi&e! " that 2ayme!t is t be made may be ;ce"tai! 2e"s !;, +ithi! the mea!i!g ' this secti ! a!d secti ! 0, alth #gh he is mis!amed " desig!ated by desc"i2ti ! !ly$ 6. 1,he6&e1 A ;cheA#e; is a bill ' e%cha!ge d"a+! ! a s2eci'ied ba!<e" a!d ! t e%2"essed t be 2ayable the"+ise tha! ! dema!d$ 7. 1+ra8er1, 1dra8ee1 The ma<e" ' a bill ' e%cha!ge " cheA#e is called the ;d"a+e";/ the 2e"s ! the"eby di"ected t 2ay is called the ;d"a+ee;$ ;7"a+ee i! case ' !eed;( Bhe! the bill " i! a!y e!d "seme!t the"e ! the !ame ' a!y 2e"s ! is gi&e! i! additi ! t the d"a+ee t be "es "ted t i! case ' !eed, s#ch 2e"s ! is called a ;d"a+ee i! case ' !eed;$ ;Acce2t ";( A'te" the d"a+ee ' a bill has sig!ed his asse!t #2 ! the bill, ", i' the"e a"e m "e 2a"ts the"e ' tha! !e, #2 ! !e ' s#ch 2a"ts, a!d deli&e"ed the same, " gi&e! ! tice ' s#ch sig!i!g t the h lde" " t s me 2e"s ! ! his behal', he is called the ;acce2t ";$

;Acce2t " ' " h ! #"; ( 8*Bhe! a bill ' e%cha!ge has bee! ! ted " 2" tested ' " ! !9 acce2ta!ce " ' " bette" sec#"ity., a!d a!y 2e"s ! acce2ts it s#2"a 2" test ' " h ! #" ' the d"a+e" " ' a!y !e ' the e!d "se", s#ch 2e"s ! is called a! ;acce2t " ' " h ! #";$ ;1ayee; ( The 2e"s ! !amed i! the i!st"#me!t, t +h m " t +h se "de" the m !ey is by the i!st"#me!t di"ected t be 2aid, is called the ;2ayee;$ 8. 1-o der1 The ;h lde"; ' a 2" miss "y ! te, bill ' e%cha!ge " cheA#e mea!s a!y 2e"s ! e!titled i! his +! !ame t the 2 ssessi ! the"e ' a!d t "ecei&e " "ec &e" the am #!t d#e the"e ! '" m the 2a"ties the"et $ Bhe"e the ! te, bill " cheA#e is l st " dest" yed, its h lde" is the 2e"s ! s e!titled at the time ' s#ch l ss " dest"#cti !$ 9. 1-o der i" d&e co&r$e1 ;C lde" i! d#e c #"se; mea!s a!y 2e"s ! +h ' " c !side"ati ! became the 2 ssess " ' a 2" miss "y ! te, bill ' e%cha!ge " cheA#e i' 2ayable t bea"e", " the 2ayee " e!d "see the"e ', i' 8*2ayable t "de"., be' "e the am #!t me!ti !ed i! it became 2ayable, a!d +ith #t ha&i!g s#''icie!t ca#se t belie&e that a!y de'ect e%isted i! the title ' the 2e"s ! '" m +h m he de"i&ed his title$ 19. 1Pa2#e"t i" d&e co&r$e1 ;1ayme!t i! d#e c #"se; mea!s 2ayme!t i! acc "da!ce +ith the a22a"e!t te! " ' the i!st"#me!t i! g d 'aith a!d +ith #t !eglige!ce t a!y 2e"s ! i! 2 ssessi ! the"e ' #!de" ci"c#msta!ces +hich d ! t a'' "d a "eas !able g" #!d ' " belie&i!g that he is ! t e!titled t "ecei&e 2ayme!t ' the am #!t the"ei! me!ti !ed$ 11. 1I" a"d i"$tr&#e"t1 A 2" miss "y ! te, bill ' e%cha!ge " cheA#e d"a+! " made i! 1>*I!dia. a!d made 2ayable i!, " d"a+! #2 ! a!y 2e"s ! "eside!t i! 1>*I!dia. shall be deemed t be a! i!la!d i!st"#me!t$ 12. 1(orei5" i"$tr&#e"t1 A!y s#ch i!st"#me!t ! t s d"a+!, made " made 2ayable shall be deemed t be ' "eig! i!st"#me!t$ 1%. 1Ne5otia: e i"$tr&#e"t1 11*41 5 A ;!eg tiable i!st"#me!t; mea!s a 2" miss "y ! te, bill ' e%cha!ge " cheA#e 2ayable eithe" t "de" " t bea"e"$ E%2la!ati ! 1 ( A 2" miss "y ! te, bill ' e%cha!ge " cheA#e is 2ayable t "de" +hich is e%2"essed t be s 2ayable " +hich is e%2"essed t be 2ayable t a 2a"tic#la" 2e"s !, a!d d es ! t c !tai! + "ds 2" hibiti!g t"a!s'e" " i!dicati!g a! i!te!ti ! that it shall ! t be t"a!s'e"able$ E%2la!ati ! ) ( A 2" miss "y ! te, bill ' e%cha!ge " cheA#e is 2ayable t bea"e" +hich is e%2"essed t be s 2ayable " ! +hich the !ly " last e!d "seme!t is a! e!d "seme!t i! bla!<$ E%2la!ati ! , ( Bhe"e a 2" miss "y ! te, bill ' e%cha!ge " cheA#e, eithe" "igi!ally " by e!d "seme!t, is e%2"essed t be 2ayable t the "de" ' a s2eci'ied 2e"s !, a!d ! t t him " his "de", it is !e&e"theless 2ayable t him " his "de" at his 2ti !$. 1)*4)5. A !eg tiable i!st"#me!t may be made 2ayable t t+ " m "e 2ayees D i!tly, " it may be made 2ayable i! the alte"!ati&e t !e ' t+ , " !e " s me ' se&e"al 2ayees$. 10. Ne5otiatio" Bhe! a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is t"a!s'e""ed t a!y 2e"s !, s as t c !stit#te the 2e"s ! the h lde" the"e ', the i!st"#me!t is said t be !eg tiated$ 13. E"dor$e#e"t Bhe! the ma<e" " h lde" ' a !eg tiable i!st"#me!t sig!s the same, the"+ise tha! as s#ch ma<e", ' " the 2#"2 se ' !eg tiati ! ! the bac< " 'ace the"e ' " ! a sli2 ' 2a2e" a!!e%ed

the"et , " s sig!s ' " the same 2#"2 se a stam2ed 2a2e" i!te!ded t be c m2leted as a !eg tiable i!st"#me!t, he is said t e!d "se the same, a!d is called the ;e!d "se";$ 16. E"dor$e#e"t 1i" : a";1 a"d 1i" f& 1-1e"dor$ee1 1,*415 I' the e!d "se" sig!s his !ame !ly, the e!d "seme!t is said t be ;i! bla!<;, a!d i' he adds a di"ecti ! t 2ay the am #!t me!ti !ed i! the i!st"#me!t t , " t the "de" ', a s2eci'ied 2e"s !, the e!d "seme!t is said t be ;i! '#ll;, a!d the 2e"s ! s s2eci'ied is called the ;e!d "see; ' the i!st"#me!t$ 4)5 The 2" &isi !s ' this Act "elati!g t a 2ayee shall a22ly +ith the !ecessa"y m di'icati !s t a! e!d "see$. 17. A#:i5&o&$ i"$tr&#e"t$ Bhe"e a! i!st"#me!t may be c !st"#ed eithe" as a 2" miss "y ! te " bill ' e%cha!ge, the h lde" may at his electi ! t"eat it as eithe" a!d the i!st"#me!t shall be the!ce' "+a"d t"eated acc "di!gly$ 18. <here a#o&"t i$ $tated differe"t 2 i" fi5&re$ a"d 8ord$ I' the am #!t #!de"ta<e! " "de"ed t be 2aid is stated di''e"e!tly i! 'ig#"es a!d i! + "ds, the am #!t stated i! + "ds shall be the am #!t #!de"ta<e! " "de"ed t be 2aid$ 19. I"$tr&#e"t$ !a2a: e o" de#a"d A 2" miss "y ! te " bill ' e%cha!ge, i! +hich ! time ' " 2ayme!t is s2eci'ied, a!d a cheA#e, a"e 2ayable ! dema!d$ 29. I"choate $ta#!ed i"$tr&#e"t$ Bhe"e !e 2e"s ! sig!s a!d deli&e"s t a! the" a 2a2e" stam2ed i! acc "da!ce +ith the la+ "elati!g t !eg tiable i!st"#me!ts the! i! ' "ce i! 10*I!dia., a!d eithe" +h lly bla!< " ha&i!g +"itte! the"e ! a! i!c m2lete !eg tiable i!st"#me!t, he the"eby gi&es 2"ima 'acie a#th "ity t the h lde" the"e ' t ma<e " c m2lete, as the case may be, #2 ! it a !eg tiable i!st"#me!t, ' " a!y am #!t s2eci'ied the"ei! a!d ! t e%ceedi!g the am #!t c &e"ed by the stam2$ The 2e"s ! s sig!i!g shall be liable #2 ! s#ch i!st"#me!t, i! the ca2acity i! +hich he sig!ed the same, t a!y h lde" i! d#e c #"se ' " s#ch am #!t/ 2" &ided that ! 2e"s ! the" tha! a h lde" i! d#e c #"se shall "ec &e" '" m the 2e"s ! deli&e"i!g the i!st"#me!t a!ythi!g i! e%cess ' the am #!t i!te!ded by him t be 2aid the"e#!de"$ 21. 1At $i5ht1, 1'" !re$e"t#e"t1, 1After $i5ht1 I! a 2" miss "y ! te " bill ' e%cha!ge the e%2"essi !s ;at sight; a!d ; ! 2"ese!tme!t; mea!s ! dema!d$ The e%2"essi ! ;a'te" sight; mea!s, i! a 2" miss "y ! te, a'te" 2"ese!tme!t ' " sight, a!d, i! a bill ' e%cha!ge a'te" acce2ta!ce, " ! ti!g ' " ! !9acce2ta!ce, " 2" test ' " ! !9 acce2ta!ce$ 22. 1Mat&rit21 The mat#"ity ' a 2" miss "y ! te " bill ' e%cha!ge is the date at +hich it 'alls d#e$ 7ays ' g"ace( E&e"y 2" miss "y ! te " bill ' e%cha!ge +hich is ! t e%2"essed t be 2ayable ! dema!d, at sight " ! 2"ese!tme!t is at mat#"ity ! the thi"d day a'te" the day ! +hich it is e%2"essed t be 2ayable$ 2%. ,a c& ati"5 #at&rit2 of :i or "ote !a2a: e $o #a"2 #o"th$ after date or $i5ht I! calc#lati!g the date at +hich a 2" miss "y ! te " bill ' e%cha!ge, made 2ayable at stated !#mbe" ' m !ths a'te" date " a'te" sight, " a'te" a ce"tai! e&e!t, is at mat#"ity, the 2e"i d stated shall be held t te"mi!ate ! the day ' the m !th, +hich c ""es2 !ds +ith the day ! +hich the i!st"#me!t is dated, " 2"ese!ted ' " acce2ta!ce " sight, " ! ted ' " ! !9acce2ta!ce, " 2" tested ' " ! !9acce2ta!ce, " the e&e!t ha22e!s ", +he"e the i!st"#me!t is a bill ' e%cha!ge made 2ayable at stated !#mbe" ' m !ths a'te" sight a!d has bee! acce2ted ' " h ! #", +ith the day ! +hich it +as s acce2ted$ I' the m !th i! +hich the 2e"i d + #ld te"mi!ate has ! c ""es2 !di!g day, the 2e"i d shall be held t te"mi!ate ! the last day ' s#ch m !th$ I &$tratio"$

4a5 A !eg tiable i!st"#me!t dated )8th @a!#a"y, 1838, is made 2ayable at !e m !th a'te" date$ The i!st"#me!t is at mat#"ity ! the thi"d day a'te" the )8th Eeb"#a"y, 1838$ 4b5 A !eg tiable i!st"#me!t, dated ,>th A#g#st, 1838, is made 2ayable th"ee m !ths a'te" date$ The i!st"#me!t is at mat#"ity ! the ,"d 7ecembe", 1838$ 4c5 A 2" miss "y ! te " bill ' e%cha!ge, dated ,1st A#g#st, 1838, is made 2ayable th"ee m !ths a'te" date$ The i!st"#me!t is at mat#"ity ! the ,"d 7ecembe", 1838$ 20. ,a c& ati"5 #at&rit2 of :i or "ote !a2a: e $o #a"2 da2$ after date or $i5ht I! calc#lati!g the date at +hich a 2" miss "y ! te " bill ' e%cha!ge made 2ayable at ce"tai! !#mbe" ' days a'te" date " a'te" sight " a'te" a ce"tai! e&e!t is at mat#"ity, the day ' the date, " ' 2"ese!tme!t ' " acce2ta!ce " sight, " ' 2" test ' " ! !9acce2ta!ce, " ! +hich the e&e!t ha22e!s, shall be e%cl#ded$ 23. <he" da2 of #at&rit2 i$ a ho ida2 Bhe! the day ! +hich a 2" miss "y ! te " bill ' e%cha!ge is at mat#"ity is a 2#blic h liday, the i!st"#me!t shall be deemed t be d#e ! the !e%t 2"ecedi!g b#si!ess day$ E%2la!ati !( The e%2"essi ! ;1#blic C liday; i!cl#des S#!days 1:*---. a!d a!y the" day decla"ed by the 1=*Ce!t"al G &e"!me!t., by ! ti'icati ! i! the O''icial GaFette, t be a 2#blic h liday$ PAR)IES )' N')ES, *ILLS AN+ ,-E./ES 26. ,a!acit2 to #a;e, etc., !ro#i$$or2 "ote$, etc. E&e"y 2e"s ! ca2able ' c !t"acti!g, acc "di!g t the la+ t +hich he is s#bDect, may bi!d himsel' a!d be b #!d by the ma<i!g, d"a+i!g, acce2ta!ce, e!d "seme!t, deli&e"y a!d !eg tiati ! ' a 2" miss "y ! te, bill ' e%cha!ge " cheA#e$ Mi! "( A mi! " may d"a+, e!d "se, deli&e" a!d !eg tiate s#ch i!st"#me!ts s as t bi!d all 2a"ties e%ce2t himsel'$ N thi!g he"ei! c !tai!ed shall be deemed t em2 +e" a c "2 "ati ! t ma<e, e!d "se " acce2t s#ch i!st"#me!ts e%ce2t i! cases i! +hich, #!de" the la+ ' " the time bei!g i! ' "ce, they a"e s em2 +e"ed$ 27. A5e"c2 E&e"y 2e"s ! ca2able ' bi!di!g himsel' " ' bei!g b #!d, as me!ti !ed i! secti ! )=, may s bi!d himsel' " be b #!d by a d#ly a#th "ised age!t acti!g i! his !ame$ A ge!e"al a#th "ity t t"a!sact b#si!ess a!d t "ecei&e a!d discha"ge debts d es ! t c !'e" #2 ! a! age!t the 2 +e" ' acce2ti!g " e!d "si!g bills ' e%cha!ge s as t bi!d his 2"i!ci2al$ A! a#th "ity t d"a+ bills ' e%cha!ge d es ! t ' itsel' im2 "t a! a#th "ity t e!d "se$ 28. Lia:i it2 of a5e"t $i5"i"5 A! age!t +h sig!s his !ame t a 2" miss "y ! te, bill ' e%cha!ge " cheA#e +ith #t i!dicati!g the"e ! that he sig!s as age!t, " that he d es ! t i!te!d the"eby t i!c#" 2e"s !al "es2 !sibility, is liable 2e"s !ally ! the i!st"#me!t, e%ce2t t th se +h i!d#ced him t sig! #2 ! the belie' that the 2"i!ci2al !ly + #ld be held liable$ 29. Lia:i it2 of e5a re!re$e"tati=e $i5"i"5 A legal "e2"ese!tati&e ' a deceased 2e"s ! +h sig!s his !ame t a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is liable 2e"s !ally the"e ! #!less he e%2"essly limits his liability t the e%te!t ' the assets "ecei&ed by him as s#ch$ %9. Lia:i it2 of dra8er The d"a+e" ' a bill ' e%cha!ge " cheA#e is b #!d i! case ' dish ! #" by the d"a+ee " acce2t " the"e ', t c m2e!sate the h lde", 2" &ided d#e ! tice ' dish ! #" has bee! gi&e! t , " "ecei&ed by, the d"a+e" as he"ei!a'te" 2" &ided$

%1. Lia:i it2 of dra8ee of che6&e The d"a+ee ' a cheA#e ha&i!g s#''icie!t '#!ds ' the d"a+e" i! his ha!ds 2" 2e"ly a22licable t the 2ayme!t ' s#ch cheA#e m#st 2ay the cheA#e +he! d#ly "eA#i"ed s t d , a!d, i! de'a#lt ' s#ch 2ayme!t, m#st c m2e!sate the d"a+e" ' " a!y l ss " damage ca#sed by s#ch de'a#lt$ %2. Lia:i it2 of #a;er of "ote a"d acce!tor of :i I! the abse!ce ' a c !t"act t the c !t"a"y, the ma<e" ' a 2" miss "y ! te a!d the acce2t " be' "e mat#"ity ' a bill ' e%cha!ge a"e b #!d t 2ay the am #!t the"e ' at mat#"ity acc "di!g t the a22a"e!t te! " ' the ! te " acce2ta!ce "es2ecti&ely, a!d the acce2t " ' a bill ' e%cha!ge at " a'te" mat#"ity is b #!d t 2ay the am #!t the"e ' t the h lde" ! dema!d$ I! de'a#lt ' s#ch 2ayme!t as a' "esaid, s#ch ma<e" " acce2t " is b #!d t c m2e!sate a!y 2a"ty t the ! te " bill ' " a!y l ss " damage s#stai!ed by him a!d ca#sed by s#ch de'a#lt$ %%. '" 2 dra8ee ca" :e acce!tor e4ce!t i" "eed or for ho"o&r N 2e"s ! e%ce2t the d"a+ee ' a bill ' e%cha!ge, " all " s me ' se&e"al d"a+ees, " a 2e"s ! !amed the"ei! as a d"a+ee i! case ' !eed, " a! acce2t " ' " h ! #", ca! bi!d himsel' by a! acce2ta!ce$ %0. Acce!ta"ce :2 $e=era dra8ee$ "ot !art"er$ Bhe"e the"e a"e se&e"al d"a+ees ' a bill ' e%cha!ge +h a"e ! t 2a"t!e"s, each ' them ca! acce2t it ' " himsel', b#t ! !e ' them ca! acce2t it ' " a! the" +ith #t his a#th "ity$ %3. Lia:i it2 of e"dor$er I! the abse!ce ' a c !t"act t the c !t"a"y, +h e&e" e!d "ses a!d deli&e"s a !eg tiable i!st"#me!t be' "e mat#"ity, +ith #t, i! s#ch e!d "seme!t, e%2"essly e%cl#di!g " ma<i!g c !diti !al his +! liability, is b #!d the"eby t e&e"y s#bseA#e!t h lde", i! case ' dish ! #" by the d"a+ee, acce2t " " ma<e", t c m2e!sate s#ch h lde" ' " a!y l ss " damage ca#sed t him by s#ch dish ! #", 2" &ided d#e ! tice ' dish ! #" has bee! gi&e! t , " "ecei&ed by, s#ch e!d "se" as he"ei!a'te" 2" &ided$ E&e"y e!d "se" a'te" dish ! #" is liable as #2 ! a! i!st"#me!t 2ayable ! dema!d$ %6. Lia:i it2 of !rior !artie$ to ho der i" d&e co&r$e E&e"y 2"i " 2a"ty t a !eg tiable i!st"#me!t is liable the"e ! t a h lde" i! d#e c #"se #!til the i!st"#me!t is d#ly satis'ied$ %7. Ma;er, dra8er a"d acce!tor !ri"ci!a $ The ma<e" ' a 2" miss "y ! te " cheA#e, the d"a+e" ' a bill ' e%cha!ge #!til acce2ta!ce, a!d the acce2t " a"e, i! the abse!ce ' a c !t"act t the c !t"a"y, "es2ecti&ely liable the"e ! as 2"i!ci2al debt "s, a!d the the" 2a"ties the"et a"e liable the"e ! as s#"eties ' " the ma<e", d"a+e" " acce2t ", as the case may be$ %8. Prior !art2 a !ri"ci!a i" re$!ect of each $&:$e6&e"t !art2 As bet+ee! the 2a"ties s liable as s#"eties, each 2"i " 2a"ty is, i! the abse!ce ' a c !t"act t the c !t"a"y, als liable the"e ! as a 2"i!ci2al debt " i! "es2ect ' each s#bseA#e!t 2a"ty$ I &$tratio" A d"a+s a bill 2ayable t his +! "de" ! B, +h acce2ts$ A a'te"+a"ds e!d "ses the bill t C, C t 7 a!d 7 t E$ As bet+ee! E a!d B, B is the 2"i!ci2al debt ", a!d A, C a!d 7 a"e his s#"eties$ As bet+ee! E a!d A, A is the 2"i!ci2al debt ", a!d C a!d 7 a"e his s#"eties$ As bet+ee! E a!d C, C is the 2"i!ci2al debt " a!d 7 is his s#"ety$ %9. S&ret2$hi! Bhe! the h lde" ' a! acce2ted bill ' e%cha!ge e!te"s i!t a!y c !t"act +ith the acce2t " +hich, #!de" secti ! 1,0 " 1,: ' the I!dia! C !t"act Act, 183) 48 ' 183)5, + #ld discha"ge the the" 2a"ties, the h lde" may e%2"essly "ese"&e his "ight t cha"ge the the" 2a"ties, a!d i! s#ch case they a"e ! t discha"ged$

09. +i$char5e of e"dor$er>$ ia:i it2 Bhe"e the h lde" ' a !eg tiable i!st"#me!t, +ith #t the c !se!t ' the e!d "se", dest" ys " im2ai"s the e!d "se"?s "emedy agai!st a 2"i " 2a"ty, the e!d "se" is discha"ged '" m liability t the h lde" t the same e%te!t as i' the i!st"#me!t had bee! 2aid at mat#"ity$ I &$tratio" A is the h lde" ' a bill ' e%cha!ge made 2ayable t the "de" ' B, +hich c !tai!s the ' ll +i!g e!d "seme!ts i! bla!<9 Ei"st e!d "seme!t, ;B;$ Sec !d e!d "seme!t, ;1ete" Billiams;$ Thi"d e!d "seme!t, ;B"ight G C $;$ E #"th e!d "seme!t ;@ h! R Fa"i ;$ This bill A 2#ts i! s#it agai!st @ h! R Fa"i a!d st"i<es #t, +ith #t @ h! R Fa"i ?s c !se!t, the e!d "seme!ts by 1ete" Billiams a!d B"ight G C $ A is ! t e!titled t "ec &e" a!ythi!g '" m @ h! R Fa"i $ 01. Acce!tor :o&"d, a tho&5h e"dor$e#e"t for5ed A! acce2t " ' a bill ' e%cha!ge al"eady e!d "sed is ! t "elie&ed '" m liability by "eas ! that s#ch e!d "seme!t is ' "ged, i' he <! +s " had "eas ! t belie&e the e!d "seme!t t be ' "ged +he! he acce2ted the bill$ 02. Acce!ta"ce of :i dra8" i" fictitio&$ "a#e A! acce2t " ' a bill ' e%cha!ge d"a+! i! a 'ictiti #s !ame a!d 2ayable t the d"a+e"?s "de" is ! t, by "eas ! that s#ch !ame is 'ictiti #s, "elie&ed '" m liability t a!y h lde" i! d#e c #"se claimi!g #!de" a! e!d "seme!t by the same ha!d as the d"a+e"?s sig!at#"e, a!d 2#"2 "ti!g t be made by the d"a+e"$ 0%. Ne5otia: e i"$tr&#e"t #ade, etc. 8itho&t co"$ideratio" A !eg tiable i!st"#me!t made, d"a+!, acce2ted, e!d "sed, " t"a!s'e""ed +ith #t c !side"ati !, " ' " a c !side"ati ! +hich 'ails, c"eates ! bligati ! ' 2ayme!t bet+ee! the 2a"ties t the t"a!sacti !$ B#t i' a!y s#ch 2a"ty has t"a!s'e""ed the i!st"#me!t +ith " +ith #t e!d "seme!t t a h lde" ' " a c !side"ati !, s#ch h lde", a!d e&e"y s#bseA#e!t h lde" de"i&i!g title '" m him, may "ec &e" the am #!t d#e ! s#ch i!st"#me!t '" m the t"a!s'e" " ' " c !side"ati ! " a!y 2"i " 2a"ty the"et $ E%ce2ti ! I( N 2a"ty ' " +h se acc mm dati ! a !eg tiable i!st"#me!t has bee! made, d"a+!, acce2ted " e!d "sed ca!, i' he has 2aid the am #!t the"e ', "ec &e" the"e ! s#ch am #!t '" m a!y 2e"s ! +h became a 2a"ty t s#ch i!st"#me!t ' " his acc mm dati !$ E%ce2ti ! II( N 2a"ty t the i!st"#me!t +h has i!d#ced a!y the" 2a"ty t ma<e d"a+, acce2t, e!d "se " t"a!s'e" the same t him ' " a c !side"ati ! +hich he has 'ailed t 2ay " 2e"' "m i! '#ll shall "ec &e" the"ei! a! am #!t e%ceedi!g the &al#e ' the c !side"ati ! 4i' a!y5 +hich he has act#ally 2aid " 2e"' "med$ 00. Partia a:$e"ce or fai &re of #o"e2-co"$ideratio" Bhe! the c !side"ati ! ' " +hich a 2e"s ! sig!ed a 2" miss "y ! te, bill ' e%cha!ge " cheA#e c !sisted ' m !ey a!d +as "igi!ally abse!t i! 2a"t, " has s#bseA#e!tly 'ailed i! 2a"t, the s#m +hich a h lde" sta!di!g i! immediate "elati ! +ith s#ch sig!e" is e!titled t "ecei&e '" m him is 2" 2 "ti !ally "ed#ced$ E%2la!ati !( The d"a+e" ' a bill ' e%cha!ge sta!ds i! immediate "elati ! +ith the acce2t "$ The ma<e" ' a 2" miss "y ! te, bill ' e%cha!ge " cheA#e sta!ds i! immediate "elati ! +ith the 2ayee, a!d the e!d "se" +ith his e!d "see$ Othe" sig!e"s may by ag"eeme!t sta!d i! immediate "elati ! +ith a h lde"$

I &$tratio" A d"a+s a bill ! B ' " Rs$ :>> 2ayable t the "de" ' A$ B acce2ts the bill, b#t s#bseA#e!tly dish ! #"s it by ! !92ayme!t$ A s#es B ! the bill$ B 2" &es that it +as acce2ted ' " &al#e as t Rs$ 0>>, a!d as a! acc mm dati ! t the 2lai!ti'' as t the "esid#e$ A ca! !ly "ec &e" Rs$ 0>>$ 03. Partia fai &re of co"$ideratio" "ot co"$i$ti"5 of #o"e2 Bhe"e a 2a"t ' the c !side"ati ! ' " +hich a 2e"s ! sig!ed a 2" miss "y ! te, bill ' e%cha!ge " cheA#e, th #gh ! t c !sisti!g ' m !ey, is asce"tai!able i! m !ey +ith #t c llate"al e!A#i"y, a!d the"e has bee! a 'ail#"e ' that 2a"ty, the s#m +hich a h lde" sta!di!g i! immediate "elati ! +ith s#ch sig!e" is e!titled t "ecei&e '" m him is 2" 2 "ti !ally "ed#ced$ 13*0:A$ C lde"?s "ight t d#2licate ' l st bill Bhe"e a bill ' e%cha!ge has bee! l st be' "e it is &e"d#e, the 2e"s ! +h +as the h lde" ' it may a22ly t the d"a+e" t gi&e him a! the" bill ' the same te! ", gi&i!g sec#"ity t the d"a+e", i' "eA#i"ed, t i!dem!i'y him agai!st all 2e"s !s +hate&e" i! case the bill alleged t ha&e bee! l st shall be ' #!d agai!$ I' the d"a+e" ! "eA#est as a' "esaid "e'#ses t gi&e s#ch d#2licate bill, he may be c m2elled t d s $ '( NE?')IA)I'N 06. +e i=er2 The ma<i!g, acce2ta!ce " e!d "seme!t ' a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is c m2leted by deli&e"y, act#al " c !st"#cti&e$ As bet+ee! 2a"ties sta!di!g i! immediate "elati !, deli&e"y t be e''ect#al m#st be made by the 2a"ty ma<i!g, acce2ti!g " e!d "si!g the i!st"#me!t, " by a 2e"s ! a#th "ised by him i! that behal'$ As bet+ee! s#ch 2a"ties a!d a!y h lde" ' the i!st"#me!t the" tha! a h lde" i! d#e c #"se, it may be sh +! that the i!st"#me!t +as deli&e"ed c !diti !ally " ' " a s2ecial 2#"2 se !ly, a!d ! t ' " the 2#"2 se ' t"a!s'e""i!g abs l#tely the 2" 2e"ty the"ei!$ A 2" miss "y ! te, bill ' e%cha!ge " cheA#e 2ayable t bea"e" is !eg tiable by the deli&e"y the"e '$ A 2" miss "y ! te, bill ' e%cha!ge " cheA#e 2ayable t e!d "seme!t a!d deli&e"y the"e '$ "de" is !eg tiable by the h lde" by

07. Ne5otiatio" :2 de i=er2 S#bDect t the 2" &isi !s ' secti ! :8, a 2" miss "y ! te, bill ' e%cha!ge " cheA#e 2ayable t bea"e" is !eg tiable by deli&e"y the"e '$ E%ce2ti !( A 2" miss "y ! te, bill ' e%cha!ge " cheA#e deli&e"ed ! c !diti ! that it is ! t t ta<e e''ect e%ce2t i! a ce"tai! e&e!t is ! t !eg tiable 4e%ce2t i! the ha!ds ' a h lde" ' " &al#e +ith #t ! tice ' the c !diti !5 #!less s#ch e&e!t ha22e!s$ I &$tratio" 4a5 A, the h lde" ' a !eg tiable i!st"#me!t 2ayable t bea"e", deli&e"s it t B?s age!t t <ee2 ' " B$ The i!st"#me!t has bee! !eg tiated$ 4b5 A, the h lde" ' a !eg tiable i!st"#me!t 2ayable t bea"e", +hich is i! the ha!ds ' A?s ba!<e", +h is at the time the ba!<e" ' B, di"ects the ba!<e" t t"a!s'e" the i!st"#me!t t B?s c"edit i! the ba!<e"?s acc #!t +ith B$ The ba!<e" d es s , a!d acc "di!gly ! + 2 ssesses the i!st"#me!t as B?s age!t$ The i!st"#me!t has bee! !eg tiated, a!d B has bec me the h lde" ' it$

08. Ne5otiatio" :2 e"dor$e#e"t S#bDect t the 2" &isi !s ' secti ! :8, a 2" miss "y ! te, bill ' e%cha!ge " cheA#e 18*2ayable t "de"., is !eg tiable by the h lde" by e!d "seme!t a!d deli&e"y the"e '$ 09. ,o"=er$io" of e"dor$e#e"t i" : a"; i"to e"dor$e#e"t i" f& The h lde" ' a !eg tiable i!st"#me!t e!d "sed i! bla!< may, +ith #t sig!i!g his +! !ame, by +"iti!g ab &e the e!d "se"?s sig!at#"e a di"ecti ! t 2ay t a!y the" 2e"s ! as e!d "see, c !&e"t the e!d "seme!t i! bla!< i!t a! e!d "seme!t i! '#ll/ a!d the h lde" d es ! t the"eby i!c#" the "es2 !sibility ' a! e!d "se"$ 39. Effect of e"dor$e#e"t The e!d "seme!t ' a !eg tiable i!st"#me!t ' ll +ed by deli&e"y t"a!s'e"s t the e!d "see the 2" 2e"ty the"ei! +ith the "ight ' '#"the" !eg tiati !, b#t the e!d "seme!t may by e%2"ess + "ds, "est"ict " e%cl#de s#ch "ight, " may me"ely c !stit#te the e!d "see a! age!t t e!d "se the i!st"#me!t, " t "ecei&e its c !te!ts ' " the e!d "se", " ' " s me the" s2eci'ied 2e"s !$ I &$tratio"$ B sig!s the ' ll +i!g i!d "seme!ts ! di''e"e!t !eg tiable i!st"#me!ts 2ayable t bea"e",9 4a5 ;2ay the c !te!ts t C !ly;$ 4b5 ;2ay C ' " my #se;$ 4c5 ;2ay C ! "de" ' " the acc #!t t B;$ 4d5 ;the +ithi! m#st be c"edited t C;$ These e!d "seme!ts e%cl#de the "ight ' '#"the" !eg tiati ! by C$ 4e5 ;2ay C;$ 4'5 ;2ay C &al#e i! acc #!t +ith the O"ie!tal Ba!<;$ 4g5 ;2ay the c !te!ts t C, b"i!g 2a"t ' the c !side"ati ! i! a ce"tai! deed ' assig!me!t e%ec#ted by C t e!d "se" a!d the"s;$ These e!d "seme!ts d ! t e%cl#de the "ight ' '#"the" !eg tiati ! by C$ 31. <ho #a2 "e5otiate E&e"y s le ma<e", d"a+e", 2ayee " i!d "see, " all ' se&e"al D i!t ma<e"s, d"a+e"s, 2ayees " e!d "sees, ' a !eg tiable i!st"#me!t may, i' the !eg tiability ' s#ch i!st"#me!t has ! t bee! "est"icted " e%cl#ded as me!ti !ed i! secti ! :>, e!d "se a!d !eg tiate the same$ E%2la!ati ! ( N thi!g i! this secti ! e!ables a ma<e" " d"a+e" t e!d "se " !eg tiate a! i!st"#me!t, #!less he is i! la+'#l 2 ssessi ! " is h lde" the"e ', " e!ables a 2ayee " e!d "see t e!d "se " !eg tiate a! i!st"#me!t, #!less he is h lde" the"e '$ I &$tratio" A bill is d"a+! 2ayable t A " "de"$ A e!d "ses it t B, the e!d "seme!t ! t c !tai!i!g the + "ds ; " "de"; " a!y eA#i&ale!t + "ds$ B may !eg tiate the i!st"#me!t$ 32. E"dor$er 8ho e4c &de$ hi$ o8" ia:i it2 or #a;e$ it co"ditio"a The e!d "se" ' a !eg tiable i!st"#me!t may, by e%2"ess + "ds i! the e!d "seme!t, e%cl#de his +! liability the"e !, " ma<e s#ch liability " the "ight ' the e!d "see t "ecei&e the am #!t d#e the"e ! de2e!d #2 ! the ha22e!i!g ' a s2eci'ied e&e!t, alth #gh s#ch e&e!t may !e&e" ha22e!$ Bhe"e a! e!d "se" s e%cl#des his liability a!d a'te"+a"ds bec mes the h lde" ' the i!st"#me!t all i!te"mediates e!d "se"s a"e liable t him$ I &$tratio"$

4a5 The e!d "se" ' a !eg tiable i!st"#me!t sig!s his !ame, addi!g the + "ds ;+ith #t "ec #"se;$ U2 ! this e!d "seme!t he i!c#"s ! liability$ 4b5 A is the 2ayee a!d h lde" ' a !eg tiable i!st"#me!t$ E%cl#di!g 2e"s !al liability by a! e!d "seme!t, ;+ith #t "ec #"se;, he t"a!s'e"s the i!st"#me!t t B, a!d B e!d "ses it t C, +h e!d "ses it t A$ A is ! t !ly "ei!stated i! his ' "me" "ights, b#t has the "ights ' a! e!d "see agai!st B a!d C$ 3%. -o der deri=i"5 tit e fro# ho der i" d&e co&r$e A h lde" ' a !eg tiable i!st"#me!t +h de"i&es title '" m a h lde" i! d#e c #"se has the "ights the"e ! ' that h lde" i! d#e c #"se$ 30. I"$tr&#e"t e"dor$ed i" : a"; S#bDect t the 2" &isi !s he"ei!a'te" c !tai!ed as t c" ssed cheA#es, a !eg tiable i!st"#me!t e!d "sed i! bla!< is 2ayable t the bea"e" the"e ' e&e! alth #gh "igi!ally 2ayable t "de"$ 33. ,o"=er$io" of e"dor$e#e"t i" : a"; i"to e"dor$e#e"t i" f& I' a !eg tiable i!st"#me!t, a'te" ha&i!g bee! e!d "sed i! bla!<, is e!d "sed i! '#ll, the am #!t ' it ca!! t be claimed '" m the e!d "se" i! '#ll, e%ce2t by the 2e"s ! t +h m it has bee! e!d "sed i! '#ll, " by !e +h de"i&es title th" #gh s#ch 2e"s !$ 36. E"dor$e#e"t for !art of $&# d&e N +"iti!g ! a !eg tiable i!st"#me!t is &alid ' " the 2#"2 se ' !eg tiati ! i' s#ch +"iti!g 2#"2 "ts t t"a!s'e" !ly a 2a"t ' the am #!t a22ea"i!g t be d#e ! the i!st"#me!t/ b#t +he"e s#ch am #!t has bee! 2a"tly 2aid a ! te t that e''ect may be e!d "sed ! the i!st"#me!t, +hich, may the! be !eg tiated ' " the bala!ce$ 37. Le5a re!re$e"tati=e ca""ot :2 de i=er2 o" 2 "e5otiate i"$tr&#e"t e"dor$ed :2 decea$ed The legal "e2"ese!tati&e ' a deceased 2e"s ! ca!! t !eg tiate by deli&e"y !ly a 2" miss "y ! te, bill ' e%cha!ge " cheA#e 2ayable t "de" a!d e!d "sed by the deceased b#t ! t deli&e"ed$ 38. I"$tr&#e"t o:tai"ed :2 &" a8f& #ea"$ or for &" a8f& co"$ideratio" Bhe! a !eg tiable i!st"#me!t has bee! l st, " has bee! btai!ed '" m a!y ma<e", acce2t " " h lde" the"e ' by mea!s ' a! ''e!ce " '"a#d, " ' " a! #!la+'#l c !side"ati !, ! 2 ssess " " e!d "see +h claims th" #gh the 2e"s ! +h ' #!d " s btai!ed the i!st"#me!t is e!titled t "ecei&e the am #!t d#e the"e ! '" m s#ch ma<e", acce2t " " h lde", " '" m a!y 2a"ty 2"i " t s#ch h lde", #!less s#ch 2 ssess " " e!d "see is, " s me 2e"s ! th" #gh +h m he claims +as, a h lde" the"e ' i! d#e c #"se$ 39. I"$tr&#e"t ac6&ired after di$ho"o&r or 8he" o=erd&e The h lde" ' a !eg tiable i!st"#me!t, +h has acA#i"ed it a'te" dish ! #", +hethe" by ! !9 acce2ta!ce " ! !92ayme!t, +ith ! tice the"e ', " a'te" mat#"ity, has !ly, as agai!st the the" 2a"ties, the "ights the"e ! ' his t"a!s'e" " ( Acc mm dati ! ! te " bill ( 1" &ided that a!y 2e"s ! +h , i! g d 'aith a!d ' " c !side"ati !, bec mes the h lde", a'te" mat#"ity, ' a 2" miss "y ! te " bill ' e%cha!ge made, d"a+! " acce2ted +ith #t c !side"ati !, ' " the 2#"2 se ' e!abli!g s me 2a"ty the"et t "aise m !ey the"e !, may "ec &e" the am #!t ' the ! te " bill '" m a!y 2"i " 2a"ty$ I &$tratio" The acce2t " ' a bill ' e%cha!ge, +he! he acce2ted it, de2 sited +ith the d"a+e" ce"tai! g ds as a c llate"al sec#"ity ' " the 2ayme!t ' the bill, +ith 2 +e" t the d"a+e" t sell the g ds a!d a22ly the 2" ceeds i! discha"ge ' the bill i' it +e"e ! t 2aid at mat#"ity$ The bill ! t ha&i!g bee! 2aid at mat#"ity, the d"a+e" s ld the g ds a!d "etai!ed the 2" ceeds, b#t e!d "sed the bill t A$ A?s title is s#bDect t the same bDecti ! as the d"a+e"?s title$

69. I"$tr&#e"t "e5otia: e ti !a2#e"t or $ati$factio" A !eg tiable i!st"#me!t may be !eg tiated 4e%ce2t by the ma<e", d"a+ee " acce2t " a'te" mat#"ity5 #!til 2ayme!t " satis'acti ! the"e ' by the ma<e", d"a+ee " acce2te" at " a'te" mat#"ity, b#t ! t a'te" s#ch 2ayme!t " satis'acti !$

'( PRESEN)MEN) 61. Pre$e"t#e"t for acce!ta"ce A bill ' e%cha!ge 2ayable a'te" sight m#st, i' ! time " 2lace is s2eci'ied the"ei! ' " 2"ese!tme!t, be 2"ese!ted t the d"a+ee the"e ' ' " acce2ta!ce, i' he ca!, a'te" "eas !able sea"ch, be ' #!d, by a 2e"s ! e!titled t dema!d acce2ta!ce, +ithi! a "eas !able time a'te" it is d"a+!, a!d i! b#si!ess h #"s ! a b#si!ess day$ I! de'a#lt ' s#ch 2"ese!tme!t, ! 2a"ty the"et is liable the"e ! t the 2e"s ! ma<i!g s#ch de'a#lt$ I' the d"a+ee ca!! t, a'te" "eas !able sea"ch, be ' #!d, the bill is dish ! #"ed$ I' the bill is di"ected t d"a+ee at a 2a"tic#la" 2lace, it m#st be 2"ese!ted at that 2lace, a!d i' at the d#e9 date ' " 2"ese!tme!t he ca!! t, a'te" "eas !able sea"ch, be ' #!d the"e !, the bill is dish ! #"ed$ 13*Bhe! a#th "ised by ag"eeme!t " #sage, a 2"ese!tme!t th" #gh the 2 st ''ice by mea!s ' a "egiste"ed lette" is s#''icie!t$. 62. Pre$e"t#e"t of !ro#i$$or2 "ote for $i5ht A 2" miss "y ! te, 2ayable at a ce"tai! 2e"i d a'te" sight, m#st be 2"ese!ted t the ma<e" the"e ' ' " sight 4i' he ca! a'te" "eas !able sea"ch be ' #!d5 by a 2e"s ! e!titled t dema!d 2ayme!t, +ithi! a "eas !able time a'te" it is made a!d i! b#si!ess h #"s ! a b#si!ess day$ I! de'a#lt ' s#ch 2"ese!tme!t, ! 2a"ty the"et is liable the"e ! t the 2e"s ! ma<i!g s#ch de'a#lt$ 6%. +ra8ee>$ ti#e for de i:eratio" The h lde" m#st, i' s "eA#i"ed by the d"a+ee ' a bill ' e%cha!ge 2"ese!ted t him ' " acce2ta!ce, all + the d"a+ee 18*' "ty9eight. h #"s 4e%cl#si&e ' 2#blic h lidays5 t c !side" +hethe" he +ill acce2t it$ 60. Pre$e"t#e"t for !a2#e"t 1" miss "y ! tes, bill ' e%cha!ge a!d cheA#es m#st be 2"ese!ted ' " 2ayme!t t the ma<e", acce2t " " d"a+ee the"e ' "es2ecti&ely, by " ! behal' ' the h lde" as he"ei!a'te" 2" &ided$ I! de'a#lt ' s#ch 2"ese!tme!t, the the" 2a"ties the"et a"e ! t liable the"e ! t s#ch h lde"$ )>*Bhe"e a#th "ised by ag"eeme!t " #sage, a 2"ese!tme!t th" #gh the 2 st ''ice by mea!s ' a "egiste"ed lette" is s#''icie!t$. E%ce2ti !( Bhe"e a 2" miss "y ! te is 2ayable ! dema!d a!d is ! t 2ayable at a s2eci'ied 2lace, ! 2"ese!tme!t is !ecessa"y i! "de" t cha"ge the ma<e" the"e '$ 63. -o&r$ for !re$e"t#e"t 1"ese!tme!t ' " 2ayme!t m#st be made d#"i!g the #s#al h #"s ' b#si!ess a!d, i' at a ba!<e"?s, +ithi! ba!<i!g h #"s$ 66. Pre$e"t#e"t for !a2#e"t of i"$tr&#e"t !a2a: e after date or $i5ht A 2" miss "y ! te " bill ' e%cha!ge, made 2ayable at a s2eci'ied 2e"i d a'te" date " sight the"e ', m#st be 2"ese!ted ' " 2ayme!t at mat#"ity$ 67. Pre$e"t#e"t for !a2#e"t of !ro#i$$or2 "ote !a2a: e :2 i"$ta #e"t$ A 2" miss "y ! te 2ayable by i!stalme!ts m#st be 2"ese!ted ' " 2ayme!t ! the thi"d day a'te" the date 'i%ed ' " 2ayme!t ' each i!stalme!t/ a!d ! !92ayme!t ! s#ch 2"ese!tme!t has the same e''ect as ! !92ayme!t ' a ! te at mat#"ity$ 68. Pre$e"t#e"t for !a2#e"t of i"$tr&#e"t !a2a: e at $!ecified ! ace a"d "ot e $e8here A 2" miss "y ! te, bill ' e%cha!ge " cheA#e made, d"a+! " acce2ted 2ayable at a s2eci'ied

2lace a!d ! t else+he"e m#st, i! "de" t cha"ge a!y 2a"ty the"et , be 2"ese!ted ' " 2ayme!t at that 2lace$ 69. I"$tr&#e"t !a2a: e at $!ecified ! ace A 2" miss "y ! te " bill ' e%cha!ge made, d"a+! " acce2ted 2ayable at a s2eci'ied 2lace m#st, i! "de" t cha"ge the ma<e" " d"a+e" the"e ', be 2"ese!ted ' " 2ayme!t at the 2lace$ 79. Pre$e"t#e"t 8here "o e4c &$i=e ! ace $!ecified A 2" miss "y ! te " bill ' e%cha!ge, ! t made 2ayable as me!ti !ed i! secti !s =8 a!d =8, m#st be 2"ese!ted ' " 2ayme!t at the 2lace ' b#si!ess4i' a!y5 " at the #s#al "eside!ce, ' the ma<e", d"a+ee " acce2t " the"e ', as the case may be$ 71. Pre$e"t#e"t 8he" #a;er, etc., ha$ "o ;"o8" ! ace of :&$i"e$$ or re$ide"ce I' the ma<e", d"a+ee, " acce2t " ' a !eg tiable i!st"#me!t has ! <! +! 2lace ' b#si!ess " 'i%ed "eside!ce, a!d ! 2lace is s2eci'ied i! the i!st"#me!t ' " 2"ese!tme!t ' " acce2ta!ce " 2ayme!t, s#ch 2"ese!tme!t may be made t him i! 2e"s ! +he"e&e" he ca! be ' #!d$ 72. Pre$e"t#e"t of che6&e to char5e dra8er )>*S#bDect t the 2" &isi !s ' secti ! 80. a cheA#e m#st, i! "de" t cha"ge the d"a+e", be 2"ese!ted at the ba!< ! +hich it is d"a+! be' "e the "elati ! bet+ee! the d"a+e" a!d his ba!<e" has bee! alte"ed t the 2"eD#dice ' the d"a+e"$ 7%. Pre$e"t#e"t of che6&e to char5e a"2 other !er$o" A cheA#e m#st, i! "de" t cha"ge a!y 2e"s ! e%ce2t the d"a+e", be 2"ese!ted +ithi! a "eas !able time a'te" deli&e"y the"e ' by s#ch 2e"s !$ 70. Pre$e"t#e"t of i"$tr&#e"t !a2a: e at de#a"d S#bDect t the 2" &isi !s ' secti ! ,1, a !eg tiable i!st"#me!t 2ayable ! dema!d m#st be 2"ese!ted ' " 2ayme!t +ithi! a "eas !able time a'te" it is "ecei&ed by the h lde"$ 73. Pre$e"t#e"t :2 or to a5e"t, re!re$e"tati=e of decea$ed, or a$$i5"ee of i"$o =e"t 1"ese!tme!t ' " acce2ta!ce " 2ayme!t may be made t the d#ly a#th "ised age!t ' the d"a+ee, ma<e" " acce2t ", as the case may be, ", +he"e the d"a+ee, ma<e" " acce2t " has died, t his legal "e2"ese!tati&e, ", +he"e he has bee! decla"ed a! i!s l&e!t, t his assig!ee$ )1*3:A$ E%c#se ' " delay i! 2"ese!tme!t ' " acce2ta!ce " 2ayme!t 7elay i! 2"ese!tme!t ))*' " acce2ta!ce " 2ayme!t. is e%c#sed i' the delay is ca#sed by ci"c#msta!ces bey !d the c !t" l ' the h lde", a!d ! t im2#table t his de'a#lt, misc !d#ct " !eglige!ce$ Bhe! the ca#se ' the delay ceases t 2e"ate, 2"ese!tme!t m#st be made +ithi! a "eas !able time$. 76. <he" !re$e"t#e"t &""ece$$ar2 N 2"ese!tme!t ' " 2ayme!t is !ecessa"y, a!d the i!st"#me!t is dish ! #"ed at the d#e date ' " 2"ese!tme!t, i! a!y ' the ' ll +i!g cases( 4a5 i' the ma<e", d"a+ee " acce2t " i!te!ti !ally 2"e&e!ts the 2"ese!tme!t ' the i!st"#me!t, " I' the i!st"#me!t bei!g 2ayable at his 2lace ' b#si!ess, he cl ses s#ch 2lace ! a b#si!ess day d#"i!g the #s#al b#si!ess h #"s, " I' the i!st"#me!t bei!g 2ayable at s me the" s2eci'ied 2lace, !eithe" he ! " a!y 2e"s ! a#th "ised t 2ay it atte!ds at s#ch 2lace d#"i!g the #s#al b#si!ess h #"s, " I' the i!st"#me!t ! t bei!g 2ayable at a!y s2eci'ied 2lace, he ca!! t a'te" d#e sea"ch be ' #!d/ 4b5 as agai!st a!y 2a"ty s #ght t be cha"ged the"e+ith, i' he has e!gaged t 2ay ! t+ithsta!di!g ! !92"ese!tme!t/ 4c5 as agai!st a!y 2a"ty i', a'te" mat#"ity, +ith <! +ledge that the i!st"#me!t has ! t bee! 2"ese!ted9

he ma<es a 2a"t 2ayme!t ! acc #!t ' the am #!t d#e ! the i!st"#me!t, " 2" mises t 2ay the am #!t d#e the"ei! +h le " i! 2a"t, " the"+ise +ai&es his "ight t ta<e ad&a!tage ' a!y de'a#lt i! 2"ese!tme!t ' " 2ayme!t/ 4d5 as agai!st the d"a+e", i' the d"a+e" c #ld ! t s#''e" damage '" m the +a!t ' s#ch 2"ese!tme!t$ 77. Lia:i it2 of :a";er for "e5 i5e"t 2 dea i"5 8ith :i !re$e"ted for !a2#e"t Bhe! a bill ' e%cha!ge, acce2ted 2ayable at a s2eci'ied ba!<, has bee! d#ly 2"ese!ted the"e ' " 2ayme!t a!d dish ! #"ed, i' the ba!<e" s !eglige!tly " im2" 2e"ly <ee2s, deals +ith " deli&e"s bac< s#ch bill as t ca#se l ss t the h lde", he m#st c m2e!sate the h lde" ' " s#ch l ss$

'( PAYMEN) AN+ IN)ERES) 78. )o 8ho# !a2#e"t $ho& d :e #ade S#bDect t the 2" &isi !s ' secti ! 8), cla#se 4c5, 2ayme!t ' the am #!t d#e ! a 2" miss "y ! te, bill ' e%cha!ge " cheA#e m#st, i! "de" t discha"ge the ma<e" " acce2t ", be made t the h lde" ' the i!st"#me!t$ 79. I"tere$t 8he" rate $!ecified Bhe! i!te"est at a s2eci'ied "ate is e%2"essly made 2ayable ! a 2" miss "y ! te " bill ' e%cha!ge, i!te"est shall be calc#lated at the "ate s2eci'ied, ! the am #!t ' the 2"i!ci2al m !ey d#e the"e !, '" m the date ' the i!st"#me!t, #!til te!de" " "ealisati ! ' s#ch am #!t, " #!til s#ch date a'te" the i!stit#ti ! ' a s#it t "ec &e" s#ch am #!t as the c #"t di"ects$ 89. I"tere$t 8he" "o rate $!ecified Bhe! ! "ate ' i!te"est is s2eci'ied i! the i!st"#me!t, i!te"est ! the am #!t d#e the"e ! shall, ),*! t+ithsta!di!g a!y ag"eeme!t "elati!g t i!te"est bet+ee! a!y 2a"ties t the i!st"#me!t., be calc#lated at the "ate ' )0*eightee! 2e" ce!t#m. 2e" a!!#m, '" m the date at +hich the same #ght t ha&e bee! 2aid by the 2a"ty cha"ged, #!til te!de" " "ealisati ! ' the am #!t d#e the"e !, " #!til s#ch date a'te" the i!stit#ti ! ' a s#it t "ec &e" s#ch am #!t as the c #"t di"ects$ E%2la!ati !( Bhe! the 2a"ty cha"ged is the i!d "se" ' a! i!st"#me!t dish ! #"ed by ! !9 2ayme!t, he is liable t 2ay i!te"est !ly '" m the time that he "ecei&es ! tice ' the dish ! #"$ 81. +e i=er2 of i"$tr&#e"t o" !a2#e"t or i"de#"it2 i" ca$e of o$$ A!y 2e"s ! liable t 2ay, a!d called #2 ! by the h lde" the"e ' t 2ay, the am #!t d#e ! a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is be' "e 2ayme!t e!titled t ha&e it sh +!, a!d is ! 2ayme!t e!titled t ha&e it deli&e"ed #2, t him, ", i' the i!st"#me!t is l st " ca!! t be 2" d#ced, t be i!dem!i'ied agai!st a!y '#"the" claim the"e ! agai!st him$

'( +IS,-AR?E (R'M LIA*ILI)Y 'N N')ES, *ILLS AN+ ,-E./ES 82. +i$char5e fro# ia:i it2 The ma<e", acce2t " " e!d "se" "es2ecti&ely ' a !eg tiable i!st"#me!t is discha"ged '" m liability the"e !9 4a5 By ca!cellati !9t a h lde" the"e ' +h ca!cels s#ch acce2t "?s " e!d "se"?s !ame +ith i!te!t t discha"ge him, a!d t all 2a"ties claimi!g #!de" s#ch h lde", 4b5 By "elease9 t a h lde" the"e ' +h the"+ise discha"ges s#ch ma<e", acce2t " " e!d "se", a!d t all 2a"ties de"i&i!g title #!de" s#ch h lde" a'te" ! tice ' s#ch discha"ge/

4c5 By 2ayme!t9t all 2a"ties the"et , i' the i!st"#me!t is 2ayable t bea"e", " has bee! e!d "sed i! bla!<, a!d s#ch ma<e", acce2t " " e!d "se" ma<es 2ayme!t i! d#e c #"se ' the am #!t d#e the"e !$ 8%. +i$char5e :2 a o8i"5 dra8ee #ore tha" fort2-ei5ht ho&r$ to acce!t I' the h lde" ' a bill ' e%cha!ge all +s the d"a+ee m "e tha! 18*' "ty eight. h #"s, e%cl#si&e ' 2#blic h lidays, t c !side" +hethe" he +ill acce2t the same, all 2"e&i #s 2a"ties ! t c !se!ti!g t s#ch all +a!ce a"e the"eby discha"ged '" m liability t s#ch h lde"$ 80. <he" che6&e "ot d& 2 !re$e"ted a"d dra8er da#a5ed there:2 ):*415 Bhe"e a cheA#e is ! t 2"ese!ted ' " 2ayme!t +ithi! a "eas !able time ' its iss#e, a!d the d"a+e" " 2e"s ! ! +h se acc #!t it is d"a+! had the "ight, at the time +he! 2"ese!tme!t #ght t ha&e bee! made, as bet+ee! himsel' a!d the ba!<e", t ha&e the cheA#e 2aid a!d s#''e"s act#al damage th" #gh the delay, he is discha"ged t the e%te!t ' s#ch damage, that is t say, t the e%te!t t +hich s#ch d"a+e" " 2e"s ! is a c"edit " ' the ba!<e" t a la"ge am #!t tha! he + #ld ha&e bee! i' s#ch cheA#e had bee! 2aid$ 4)5 I! dete"mi!i!g +hat is a "eas !able time, "ega"d shall be had t the !at#"e ' the i!st"#me!t, the #sage ' t"ade a!d ' ba!<e"s, a!d the 'acts ' the 2a"tic#la" case$ 4,5 The h lde" ' the cheA#es as t +hich s#ch d"a+e" " 2e"s ! is s discha"ged shall be a c"edit ", i! lie# ' s#ch d"a+e" " 2e"s !, ' s#ch ba!<e" t the e%te!t ' s#ch discha"ge a!d e!titled t "ec &e" the am #!t '" m him$ I &$tratio"$ 4a5 A d"a+s a cheA#e ' " Rs$ 1,>>>, a!d, +he! the cheA#e #ght t be 2"ese!ted, has '#!ds at the ba!< t meet it$ The ba!< 'ails be' "e the cheA#e is 2"ese!ted$ The d"a+e" is discha"ged, b#t the h lde" ca! 2" &e agai!st the ba!< ' " the am #!t ' the cheA#e$ 4b5 A d"a+s a cheA#e at Umballa ! a ba!< i! Calc#tta$ The ba!< 'ails be' "e the cheA#e c #ld be 2"ese!ted i! "di!a"y c #"se$ A is ! t discha"ged, ' " he has ! t s#''e"ed act#al damage th" #gh a!y delay i! 2"ese!ti!g the cheA#e$ 83. ,he6&e !a2a: e to order )=*415 Bhe"e a cheA#e 2ayable t "de" 2#"2 "ts t be e!d "sed by " ! behal' ' the 2ayee, the d"a+ee is discha"ged by 2ayme!t i! d#e c #"se$ 4)5 Bhe"e a cheA#e is "igi!ally e%2"essed t be 2ayable t bea"e", the d"a+ee is discha"ged by 2ayme!t i! d#e c #"se t the bea"e" the"e ', ! t+ithsta!di!g a!y e!d "seme!t +hethe" i! '#ll " i! bla!< a22ea"i!g the"e !, a!d ! t+ithsta!di!g that a!y s#ch e!d "seme!t 2#"2 "ts t "est"ict " e%cl#de '#"the" !eg tiati !$. )1*8:A$ 7"a'ts d"a+! by !e b"a!ch ' a ba!< ! a! the" 2ayable t "de" Bhe"e a!y d"a't, that is a! "de" t 2ay m !ey, d"a+! by !e ''ice ' a ba!< #2 ! a! the" ''ice ' the same ba!< ' " a s#m ' m !ey 2ayable t "de" ! dema!d, 2#"2 "ts t be e!d "sed by " ! behal' ' the 2ayee, the ba!< is discha"ged by 2ayme!t i! d#e c #"se$. 86. Partie$ "ot co"$e"ti"5 di$char5ed :2 6&a ified or i#ited acce!ta"ce I' the h lde" ' a bill ' e%cha!ge acA#iesces i! a A#ali'ied acce2ta!ce, " !e limited t 2a"t ' the s#m me!ti !ed i! the bill, " +hich s#bstit#tes a di''e"e!t 2lace " time ' " 2ayme!t, " +hich, +he"e the d"a+ees a"e ! t 2a"t!e"s, is ! t sig!ed by all the d"a+ees, all 2"e&i #s 2a"ties +h se c !se!t is ! t btai!ed t s#ch acce2ta!ce a"e discha"ged as agai!st the h lde" a!d th se claimi!g #!de" him, #!less ! ! tice gi&e! by the h lde" they asse!t t s#ch acce2ta!ce$ E%2la!ati !( A! acce2ta!ce is A#ali'ied,9 4a5 +he"e it is c !diti !al, decla"i!g the 2ayme!t t be de2e!de!t ! the ha22e!i!g ' a! e&e!t the"ei! stated/ 4b5 +he"e it #!de"ta<es the 2ayme!t ' 2a"t !ly ' the s#m "de"ed t be 2aid/

4c5 +he"e, ! 2lace ' 2ayme!t bei!g s2eci'ied ! the "de" it #!de"ta<es the 2ayme!t at a s2eci'ied 2lace, a!d ! t the"+ise " else+he"e/ " +he"e, a 2lace ' 2ayme!t bei!g s2eci'ied i! the "de", it #!de"ta<es the 2ayme!t at s me the" 2lace a!d ! t the"+ise " else+he"e/ 4d5 +he"e it #!de"ta<es the 2ayme!t at a time the" tha! that at +hich #!de" the "de" it + #ld be legally d#e$ 87. Affect of #ateria a teratio" A!y mate"ial alte"ati ! ' a !eg tiable i!st"#me!t "e!de"s the same & id as agai!st a!y !e +h is a 2a"ty the"et at the time ' ma<i!g s#ch alte"ati ! a!d d es ! t c !se!t the"et , #!less it +as made i! "de" t ca""y #t the c mm ! i!te!ti ! ' the "igi!al 2a"ties/ A teratio" :2 e"dor$ee@ a!d a!y s#ch alte"ati !, i' made by a! e!d "see, discha"ges his e!d "se" '" m all liability t him i! "es2ect ' the c !side"ati ! the"e '$ The 2" &isi !s ' this secti ! a"e s#bDect t th se ' secti !s )>, 08, 8= a!d 1):$ 88. Acce!tor or e"dor$er :o&"d "ot8ith$ta"di"5 !re=io&$ a teratio" A! acce2t " " e!d "se" ' a !eg tiable i!st"#me!t is b #!d by this acce2ta!ce " i!d "seme!t ! t+ithsta!di!g a!y 2"e&i #s alte"ati ! ' the i!st"#me!t$ 89. Pa2#e"t of i"$tr&#e"t o" 8hich a teratio" i$ "ot a!!are"t Bhe"e a 2" miss "y ! te, bill ' e%cha!ge " cheA#e has bee! mate"ially alte"ed b#t d es ! t a22ea" t ha&e bee! s alte"ed, " +he"e a cheA#e is 2"ese!ted ' " 2ayme!t +hich d es ! t at the time ' 2"ese!tati ! a22ea" t be c" ssed " t ha&e had a c" ssi!g +hich has bee! blite"ated, 2ayme!t the"e ' by a 2e"s ! " ba!<e" liable t 2ay, a!d 2ayi!g the same acc "di!g t the a22a"e!t te! " the"e ' at the time ' 2ayme!t a!d the"+ise i! d#e c #"se, shall discha"ge s#ch a 2e"s ! " ba!<e" '" m all liability the"e !, a!d s#ch 2ayme!t shall ! t be A#esti !ed by "eas ! ' the i!st"#me!t ha&i!g bee! alte"ed, " the cheA#e c" ssed$ 99. E4ti"5&i$h#e"t of ri5ht$ of actio" o" :i i" acce!tor>$ ha"d$ I' a bill ' e%cha!ge +hich has bee! !eg tiated is, at " a'te" mat#"ity, held by the acce2t " i! his +! "ight, all "ights ' acti ! the"e ! a"e e%ti!g#ished$ '( N')I,E '( +IS-'N'/R 91. +i$ho"o&r :2 "o"-acce!ta"ce A bill ' e%cha!ge is said t be dish ! #"ed by ! !9acce2ta!ce +he! the d"a+ees, " !e ' se&e"al d"a+ees ! t bei!g 2a"t!e"s, ma<es de'a#lt i! acce2ta!ce #2 ! bei!g d#ly "eA#i"ed t acce2t the bill, " +he"e 2"ese!tme!t is e%c#sed a!d the bill is ! t acce2ted$ Bhe"e the d"a+ee is i!c m2ete!t t c !t"act, " the acce2ta!ce is A#ali'ied the bill may be t"eated as dish ! #"ed$ 92. +i$ho"o&r :2 "o"-!a2#e"t A 2" miss "y ! te, bill ' e%cha!ge " cheA#e is said t be dish ! #"ed by ! !92ayme!t +he! the ma<e" ' the ! te, acce2t " ' the bill " d"a+ee ' the cheA#e ma<es de'a#lt i! 2ayme!t #2 ! bei!g d#ly "eA#i"ed t 2ay the same$ 9%. *2 a"d to 8ho# "otice $ho& d :e 5i=e" Bhe! a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is dish ! #"ed by ! !9acce2ta!ce " ! !9 2ayme!t, the h lde" the"e ', " s me 2a"ty the"et +h "emai!s liable the"e !, m#st gi&e ! tice that the i!st"#me!t has bee! s dish ! #"ed t all the" 2a"ties +h m the h lde" see<s t ma<e se&e"ally liable the"e !, a!d t s me !e ' se&e"al 2a"ties +h m he see<s t ma<e D i!tly liable the"e !$

N thi!g i! this secti ! "e!de"s it !ecessa"y t gi&e ! tice t the ma<e" ' the dish ! #"ed 2" miss "y ! te, " the d"a+ee " acce2t " ' the dish ! #"ed bill ' e%cha!ge " cheA#e$ 90. Mode i" 8hich "otice #a2 :e 5i=e" N tice ' dish ! #" may be gi&e! t a d#ly a#th "ised age!t ' the 2e"s ! t +h m it is "eA#i"ed t be gi&e!, ", +he"e he has died, t his legal "e2"ese!tati&e, ", +he"e he has bee! decla"ed a! i!s l&e!t, t his assig!ee/ may be "al " +"itte!/ may, i' +"itte!, be se!t by 2 st/ a!d may be i! a!y ' "m/ b#t it m#st i!' "m the 2a"ty t +h m it is gi&e!, eithe" i! e%2"ess te"ms " by "eas !able i!te!dme!t, that the i!st"#me!t has bee! dish ! #"ed, a!d i! +hat +ay, a!d that he +ill be held liable the"e !/ a!d it m#st be gi&e! +ithi! a "eas !able time a'te" dish ! #", at the 2lace ' b#si!ess " 4i! case s#ch 2a"ty has ! 2lace ' b#si!ess5 at the "eside!ce ' the 2a"ty ' " +h m it is i!te!ded$ I' the ! tice is d#ly di"ected a!d se!t by 2 st a!d misca""ies, s#ch misca""iage d es ! t "e!de" the ! tice i!&alid$ 93. Part2 recei=i"5 #&$t tra"$#it "otice of di$ho"o&r A!y 2a"ty "ecei&i!g ! tice ' dish ! #" m#st, i! "de" t "e!de" a!y 2"i " 2a"ty liable t himsel', gi&e ! tice ' dish ! #" t s#ch 2a"ty +ithi! a "eas !able time, #!less s#ch 2a"ty the"+ise "ecei&es d#e ! tice as 2" &ided by secti ! 8,$ 96. A5e"t for !re$e"t#e"t Bhe! the i!st"#me!t is de2 sited +ith a! age!t ' " 2"ese!tme!t, the age!t is e!titled t the same time t gi&e ! tice t his 2"i!ci2al as i' he +e"e the h lde" gi&i!g ! tice ' dish ! #", a!d the 2"i!ci2al is e!titled t a '#"the" li<e 2e"i d t gi&e ! tice ' dish ! #"$ 97. <he" !art2 to 8ho# "otice 5i=e" i$ dead Bhe! the 2a"ty t +h m ! tice ' dish ! #" is des2atched is dead, b#t the 2a"ty des2atchi!g the ! tice is ig! "a!t ' his death, the ! tice is s#''icie!t$ 98. <he", "otice of di$ho"o&r i$ &""ece$$ar2 N ! tice ' dish ! #" is !ecessa"y,9 4a5 +he! it is dis2e!sed +ith by the 2a"ty e!titled the"et / 4b5 i! "de" t cha"ge the d"a+e", +he! he has c #!te"ma!ded 2ayme!t/ 4c5 +he! the 2a"ty cha"ged c #ld ! t s#''e" damages ' " +a!t ' ! tice/ 4d5 +he! the 2a"ty e!titled t ! tice ca!! t a'te" d#e sea"ch be ' #!d/ " the 2a"ty b #!d t gi&e ! tice is, ' " a!y the" "eas !, #!able +ith #t a!y 'a#lt ' his +! t gi&e it/ 4e5 t cha"ge the d"a+e"s, +he! the acce2t " is als a d"a+e"/ 4'5 i! the case ' a 2" miss "y ! te +hich is ! t !eg tiable/ 4g5 +he! the 2a"ty e!titled t ! tice, <! +i!g the 'acts, 2" mises #!c !diti !ally t 2ay the am #!t d#e ! the i!st"#me!t$

'( N')IN? AN+ PR')ES) 99. Noti"5 Bhe! a 2" miss "y ! te " bill ' e%cha!ge has bee! dish ! #"ed by ! !9acce2ta!ce " ! !9 2ayme!t, the h lde" may ca#se s#ch dish ! #" t be ! ted by a ! ta"y 2#blic #2 ! the i!st"#me!t, " #2 ! a 2a2e" attached the"et , " 2a"tly #2 ! each, s#ch ! te m#st be made +ithi! a "eas !able time a'te" dish ! #", a!d m#st s2eci'y the date ' dish ! #", the "eas !, i' a!y assig!ed ' " s#ch dish ! #", " i' the i!st"#me!t has ! t bee! e%2"essly dish ! #"ed, the "eas ! +hy the h lde" t"eats it as dish ! #"ed, a!d the ! ta"y?s cha"ges$

199. Prote$t Bhe! a 2" miss "y ! te " bill ' e%cha!ge has bee! dish ! #"ed by ! !9acce2ta!ce " ! !9 2ayme!t, the h lde" may, +ithi! a "eas !able time, ca#se s#ch dish ! #" t be ! ted a!d ce"ti'ied by a ! ta"y 2#blic$ S#ch ce"ti'icate is called a 2" test$ 1" test ' " bette" sec#"ity ( Bhe! the acce2t " ' a bill ' e%cha!ge has bec me i!s l&e!t, " his c"edit has bee! 2#blicly im2eached, be' "e the mat#"ity ' the bill, the h lde" may, +ithi! a "eas !able time, ca#se a ! ta"y 2#blic t dema!d bette" sec#"ity ' the acce2t ", a!d ! its bei!g "e'#sed may, +ith a "eas !able time, ca#se s#ch 'acts t be ! ted a!d ce"ti'ied as a' "esaid$ S#ch ce"ti'icate is called a 2" test ' " bette" sec#"ity$ 191. ,o"te"t$ of !rote$t A 2" test #!de" secti ! 1>> m#st c !tai!,9 4a5 eithe" the i!st"#me!t itsel', " a lite"al t"a!sc"i2t ' the i!st"#me!t a!d ' e&e"ythi!g +"itte! " 2"i!ted the"e#2 !/ 4b5 the !at#"e ' the 2e"s ! ' " +h m a!d agai!st +h m the i!st"#me!t has bee! 2" tested/ 4c5 a stateme!t that 2ayme!t " acce2ta!ce, " bette" sec#"ity, as the case may be, has bee! dema!ded ' s#ch 2e"s ! by the ! ta"y 2#blic/ the te"ms ' his a!s+e", i' a!y, " a stateme!t that he ga&e ! a!s+e", " that he c #ld ! t be ' #!d/ 4d5 +he! the ! te " bill has bee! dish ! #"ed, the 2lace a!d time ' dish ! #", a!d, +he! bette" sec#"ity has bee! "e'#sed, the 2lace a!d time ' "e'#sal/ 4e5 the s#bsc"i2ti ! ' the ! ta"y 2#blic ma<i!g the 2" test/ 4'5 i! the e&e!t ' a! acce2ta!ce ' " h ! #" " ' a 2ayme!t ' " h ! #", the !ame ' the 2e"s ! by +h m, ' the 2e"s ! ' " +h m, a!d the ma!!e" i! +hich, s#ch acce2ta!ce " 2ayme!t +as ''e"ed a!d e''ected$ 13*A ! ta"y 2#blic may ma<e the dema!d me!ti !ed i! cla#se 4c5 ' this secti ! eithe" i! 2e"s ! " by his cle"< ", +he"e a#th "ised by ag"eeme!t " #sage, by "egiste"ed lette"$. 192. Notice of !rote$t Bhe! a 2" miss "y ! te " bill ' e%cha!ge is "eA#i"ed by la+ t be 2" tested, ! tice ' s#ch 2" test m#st be gi&e! i!stead ' ! tice ' dish ! #", i! the same ma!!e" a!d s#bDect t the same c !diti !s/ b#t the ! tice may be gi&e! by the ! ta"y 2#blic +h ma<es the 2" test$ 19%. Prote$t for "o"-!a2#e"t after di$ho"o&r :2 "o"-acce!ta"ce All bills ' e%cha!ge d"a+! 2ayable at s me the" 2lace tha! the 2lace me!ti !ed as the "eside!ce ' the d"a+ee, a!d +hich a"e dish ! #"ed by ! !9acce2ta!ce, may, +ith #t '#"the" 2"ese!tme!t t the d"a+ee, be 2" tested ' " ! !92ayme!t, i! the 2lace s2eci'ied ' " 2ayme!t, #!less 2aid be' "e " at mat#"ity$ 190. Prote$t of forei5" :i $ E "eig! bills ' e%cha!ge m#st be 2" tested ' " dish ! #" +he! s#ch 2" test is "eA#i"ed by the la+ ' the 2lace +he"e they a"e d"a+!$ 13*1>0A$ Bhe! ! ti!g eA#i&ale!t t 2" test E " the 2#"2 ses ' this Act, +he"e a bill " ! te is "eA#i"ed t be 2" tested +ithi! a s2eci'ied time " be' "e s me '#"the" 2" ceedi!g is ta<e!, it is s#''icie!t that the bill has bee! ! ted ' " 2" test be' "e the e%2i"ati ! ' the s2eci'ied time " the ta<i!g ' the 2" ceedi!g/ a!d the ' "mal 2" test may be e%te!ded at a!y time the"ea'te" as ' the date ' the ! ti!g$.

'( REAS'NA*LE )IME

193. Rea$o"a: e ti#e I! dete"mi!i!g +hat is a "eas !able time ' " 2"ese!tme!t ' " acce2ta!ce " 2ayme!t, ' " gi&i!g ! tice ' dish ! #" a!d ' " ! ti!g, "ega"d shall be had t the !at#"e ' the i!st"#me!t a!d the #s#al c #"se ' deali!g +ith "es2ect t simila" i!st"#me!ts/ a!d, i! calc#lati!g s#ch time, 2#blic h lidays shall be e%cl#ded$ 196. Rea$o"a: e ti#e of 5i=i"5 "otice of di$ho"o&r I' the h lde" a!d the 2a"ty t +h m ! tice ' dish ! #" is gi&e! ca""y ! b#si!ess " li&e 4as the case may be5 i! di''e"e!t 2laces, s#ch ! tice is gi&e! +ithi! a "eas !able time i' it is des2atched by the !e%t 2 st " ! the day !e%t a'te" the day ' dish ! #"$ I' the said 2a"ties ca""y ! b#si!ess " li&e i! the same 2lace, s#ch ! tice is gi&e! +ithi! a "eas !able time i' it is des2atched i! time t "each its desti!ati ! ! the date !e%t a'te" the day ' dish ! #"$ 197. Rea$o"a: e ti#e for tra"$#itti"5 $&ch "otice A 2a"ty "ecei&i!g ! tice ' dish ! #", +h see<s t e!' "ce his "ight agai!st a 2"i " 2a"ty, t"a!smits the ! tice +ithi! a "eas !able time i' he t"a!smits it +ithi! the same time a'te" its "ecei2t as he + #ld ha&e had t gi&e ! tice i' he had bee! the h lde"$

'( A,,EP)AN,E AN+ PAYMEN) ('R -'N'/R AN+ RE(EREN,E IN ,ASE '( NEE+ 198. Acce!ta"ce for ho"o&r Bhe! a bill ' e%cha!ge has bee! ! ted " 2" tested ' " ! !9acce2ta!ce " ' " bette" sec#"ity, a!y 2e"s ! ! t bei!g a 2a"ty al"eady liable the"e ! may, +ith the c !se!t ' the h lde", by +"iti!g ! the bill acce2t the same ' " the h ! #" ' a!y 2a"ty the"et )3*---.$ 199. -o8 acce!ta"ce for ho"o&r #&$t :e #ade A 2e"s ! desi"i!g t acce2t ' " h ! #" m#st, )8*by +"iti!g ! the bill #!de" his ha!d., decla"e that he acce2ts #!de" 2" test the 2" tested bill ' " the h ! #" ' the d"a+e" " ' a 2a"tic#la" e!d "se" +h m he !ames, " ge!e"ally ' " h ! #" )8*---.$ 119. Acce!ta"ce "ot $!ecif2i"5 for 8ho$e ho"o&r it i$ #ade Bhe"e the acce2ta!ce d es ! t e%2"ess ' " +h se h ! #" it is made it shall be deemed t be made ' " the h ! #" ' the d"a+e"$ 111. Lia:i it2 of acce!tor for ho"o&r A! acce2t " ' " h ! #" bi!ds himsel' t all 2a"ties s#bseA#e!t t the 2a"ty ' " +h se h ! #" he acce2ts t 2ay the am #!t ' the bill i' the d"a+ee d es ! t/ a!d s#ch 2a"ty a!d all 2"i " 2a"ties a"e liable i! thei" "es2ecti&e ca2acities t c m2e!sate the acce2t " ' " h ! #" ' " all l ss " damage s#stai!ed by him i! c !seA#e!ce ' s#ch acce2ta!ce$ B#t a! acce2t " ' " h ! #" is ! t liable t the h lde" ' the bill #!less it is 2"ese!ted, " 4i! case the add"ess gi&e! by s#ch acce2t " ! the bills is a 2lace the" tha! the 2lace +he"e the bill is made 2ayable5 ' "+a"ded ' " 2"ese!tme!t, ! t late" tha! the day !e%t a'te" the day ' its mat#"ity$ 112. <he" acce!tor for ho"o&r #a2 :e char5ed A! acce2t " ' " h ! #" ca!! t be cha"ged #!less the bill has at its mat#"ity bee! 2"ese!ted t the d"a+ee ' " 2ayme!t, a!d has bee! dish ! #"ed by him, a!d ! ted " 2" tested ' " s#ch dish ! #"$ 11%. Pa2#e"t for ho"o&r Bhe! a bill ' e%cha!ge has bee! ! ted " 2" tested ' " ! !92ayme!t, a!y 2e"s ! may 2ay the same ' " the h ! #" ' a!y 2a"ty liable t 2ay the same/ 2" &ided that the 2e"s ! s 2ayi!g 13* " his age!t i! that behal'. has 2"e&i #sly decla"ed be' "e a ! ta"y 2#blic the 2a"ty ' " +h se h ! #" he 2ays, a!d that s#ch decla"ati ! has bee! "ec "ded by s#ch ! ta"y 2#blic$

110. Ri5ht of !a2er for ho"o&r A!y 2e"s ! s 2ayi!g is e!titled t all the "ights i! "es2ect ' the bill, ' the h lde" at the time ' s#ch 2ayme!t, a!d may "ec &e" '" m the 2a"ty ' " +h se h ! #" he 2ays all s#ms s 2aid, +ith i!te"est the"e ! a!d +ith all e%2e!ses 2" 2e"ly i!c#""ed i! ma<i!g s#ch 2ayme!t$ 113. +ra8ee i" ca$e of "eed Bhe"e a d"a+ee i! case ' !eed is !amed i! a bill ' e%cha!ge, " i! a!y e!d "seme!t the"e !, the bill is ! t dish ! #"ed #!til it has bee! dish ! #"ed by s#ch d"a+ee$ 116. Acce!ta"ce a"d !a2#e"t 8itho&t !rote$t A d"a+ee i! case ' !eed may acce2t a!d 2ay the bill ' e%cha!ge +ith #t 2"e&i #s 2" test

'( ,'MPENSA)I'N 117. R& e$ a$ to co#!e"$atio" The c m2e!sati ! 2ayable i! case ' dish ! #" ' 2" miss "y ! te, bill ' e%cha!ge " cheA#e, by a!y 2a"ty liable t the h lde" " a!y e!d "see, shall ,>*---. be dete"mi!ed by the ' ll +i!g "#les( 4a5 the h lde" is e!titled t the am #!t d#e #2 ! the i!st"#me!t t gethe" +ith the e%2e!se 2" 2e"ly i!c#""ed i! 2"ese!ti!g, ! ti!g a!d 2" testi!g it/ 4b5 +he! the 2e"s ! cha"ged "esides at a 2lace di''e"e!t '" m that at +hich the i!st"#me!t +as 2ayable, the h lde" is e!titled t "ecei&e s#ch s#m at the c#""e!t "ate ' e%cha!ge bet+ee! the t+ 2laces/ 4c5 a! e!d "se" +h , bei!g liable, has 2aid the am #!t d#e ! the same is e!titled t the am #!t s 2aid +ith i!te"est at ,1*eightee! 2e" ce!t#m. 2e" a!!#m '" m the date ' 2ayme!t #!til te!de" " "ealisati ! the"e ', t gethe" +ith all e%2e!ses ca#sed by the dish ! #" a!d 2ayme!t/ 4d5 +he! the 2e"s ! cha"ged a!d s#ch e!d "se" "eside at di''e"e!t 2laces, the e!d "se" is e!titled t "ecei&e s#ch s#m at the c#""e!t "ate ' e%cha!ge bet+ee! the t+ 2laces/ 4e5 the 2a"ty e!titled t c m2e!sati ! may d"a+ a bill #2 ! the 2a"ty liable t c m2e!sate him, 2ayable at sight " ! dema!d, ' " the am #!t d#e t him, t gethe" +ith all e%2e!ses 2" 2e"ly i!c#""ed by him$ S#ch bill m#st be acc m2a!ied by the i!st"#me!t dish ! #"ed a!d the 2" test the"e ' 4i' a!y5$ I' s#ch bill is dish ! #"ed, the 2a"ty dish ! #"i!g the same is liable t ma<e c m2e!sati ! the"e ' i! the same ma!!e" as i! the case ' the "igi!al bill$

SPE,IAL R/LES '( EAI+EN,E 118. Pre$&#!tio"$ a$ to "e5otia: e i"$tr&#e"t$ U!til the c !t"a"y is 2" &ed, the ' ll +i!g 2"es#m2ti ! shall be made(9 4a5 ' c !side"ati !9that e&e"y !eg tiable i!st"#me!t +as made " d"a+! ' " c !side"ati !, a!d that e&e"y s#ch i!st"#me!t, +he! it has bee! acce2ted, e!d "sed, !eg tiated " t"a!s'e""ed, +as acce2ted, e!d "sed, !eg tiated " t"a!s'e""ed ' " c !side"ati !/ 4b5 as t date9that e&e"y !eg tiable i!st"#me!t bea"i!g a date +as made " d"a+! ! s#ch date/ 4c5 as t time ' acce2ta!ce9that e&e"y acce2ted bill ' e%cha!ge +as acce2ted +ithi! a "eas !able time a'te" its date a!d be' "e its mat#"ity/

4d5 as t time ' t"a!s'e"9that e&e"y t"a!s'e" ' a !eg tiable i!st"#me!t +as made be' "e its mat#"ity/ 4e5 as t "de" ' e!d "seme!ts9that the e!d "seme!ts a22ea"i!g #2 ! a !eg tiable i!st"#me!t +e"e made i! the "de" i! +hich they a22ea" the"e !/ 4'5 as t stam2s9that a l st 2" miss "y ! te, bill ' e%cha!ge " cheA#e +as d#ly stam2ed/ 4g5 that h lde" is a h lde" i! d#e c #"se9that the h lde" ' a !eg tiable i!st"#me!t is a h lde" i! d#e c #"se/ 2" &ided that, +he"e the i!st"#me!t has bee! c !tai!ed '" m its la+'#l +!e", " '" m a!y 2e"s ! i! la+'#l c#st dy the"e ', by mea!s ' a! ''e!ce " '"a#d, " has bee! btai!ed '" m the ma<e" " acce2t " the"e ' by mea!s ' a! ''e!ce " '"a#d, " ' " #!la+'#l c !side"ati !, the b#"de! ' 2" &i!g that the h lde" is a h lde" i! d#e c #"se lies #2 ! him$ 119. Pre$&#!tio" o" !roof of !rote$t I! a s#it #2 ! a! i!st"#me!t +hich has bee! dish ! #"ed, the c #"t shall, ! 2" 2"es#me the 'act ' dish ! #", #!less a!d #!til s#ch 'act is dis2" &ed$ ' ' the 2" test,

129. E$to!!e a5ai"$t de"2i"5 ori5i"a =a idit2 of i"$tr&#e"t N ma<e" ' a 2" miss "y ! te, a!d ! d"a+e" ' a bill ' e%cha!ge " cheA#e, a!d ! acce2t " ' a bill ' e%cha!ge ' " the h ! #" ' the d"a+e" shall, ! 2" ' ' the 2" test, 2"es#me the 'act ' dish ! #", #!less a!d #!til &alidity ' the i!st"#me!t as "igi!ally made " d"a+!$ 121. E$to!!e a5ai"$t de"2i"5 ca!acit2 of !a2ee to e"dor$e N ma<e" ' a 2" miss "y ! te, a!d ! acce2t " ' a bill ' e%cha!ge ,)*2ayable t "de". shall, i! s#it the"e ! by a h lde" i! d#e c #"se, be 2e"mitted t de!y the 2ayee?s ca2acity, at the "ate ' the ! te " bill, t e!d "se the same$ 122. E$to!!e a5ai"$t de"2i"5 $i5"at&re or ca!acit2 of !rior !art2 N e!d "se" ' a !eg tiable i!st"#me!t shall, i! a s#it the"e ! by a s#bseA#e!t h lde", be 2e"mitted t de!y the sig!at#"e " ca2acity t c !t"act ' a!y 2"i " 2a"ty t the i!st"#me!ts '( ,R'SSE+ ,-E./ES 12%. ,he6&e cro$$ed 5e"era 2 Bhe"e a cheA#e bea"s ac" ss its 'ace a! additi ! ' the + "ds ;a!d c m2a!y; " a!y abb"e&iati ! the"e ', bet+ee! t+ 2a"allel t"a!s&e"se li!es " ' t+ 2a"allel t"a!s&e"se li!es sim2ly, eithe" +ith " +ith #t the + "d ;! t !eg tiable;, that additi ! shall be deemed a c" ssi!g, a!d the cheA#e shall be deemed t be c" ssed ge!e"ally$ 120. ,he6&e cro$$ed $!ecia 2 Bhe"e a cheA#e bea"s ac" ss its 'ace a! additi ! ' the !ame ' a ba!<e", eithe" +ith " +ith #t the + "ds ;! t !eg tiable;, that additi ! shall be deemed a c" ssi!g a!d the cheA#e shall be deemed t be c" ssed s2ecially, a!d t be c" ssed t that ba!<e"$ 123. ,ro$$i"5 after i$$&e Bhe"e a cheA#e is #!c" ssed, the h lde" may c" ss it ge!e"ally " s2ecially$ Bhe"e a cheA#e is c" ssed ge!e"ally, the h lde" may c" ss it s2ecially$ Bhe"e a cheA#e is c" ssed ge!e"ally " s2ecially, the h lde" may add the + "ds ;! t !eg tiable;$ Bhe"e a cheA#e is c" ssed s2ecially, the ba!<e" t +h m it is c" ssed may agai! c" ss it s2ecially t a! the" ba!<e", his age!t, ' " c llecti !$ 126. Pa2#e"t of che6&e cro$$ed 5e"era 2 Bhe"e a cheA#e is c" ssed ge!e"ally, the ba!<e" ! +h m it is d"a+! shall ! t 2ay it the"+ise tha! t a ba!<e"$

1ayme!t ' cheA#e c" ssed s2ecially( Bhe"e a cheA#e is c" ssed s2ecially, the ba!<e" ! +h m it is d"a+! shall ! t 2ay it the"+ise tha! t the ba!<e" t +h m it is c" ssed, " his age!t ' " c llecti !$ 127. Pa2#e"t of che6&e cro$$ed $!ecia 2 #ore tha" o"ce Bhe"e a cheA#e is c" ssed s2ecially t m "e tha! !e ba!<e", e%ce2t +he! c" ssed t a! age!t ' " the 2#"2 se ' c llecti !, the ba!<e" ! +h m it is d"a+! shall "e'#se 2ayme!t the"e '$ 128. Pa2#e"t i" d&e co&r$e of cro$$ed che6&e Bhe"e the ba!<e" ! +h m a c" ssed cheA#e is d"a+! has 2aid the same i! d#e c #"se, the ba!<e" 2ayi!g the cheA#e, a!d 4i! case s#ch cheA#e has c me t the ha!ds ' the 2ayee5 the d"a+e" the"e ', shall "es2ecti&ely be e!titled t the same "ights, a!d be 2laced i! the same 2 siti ! i! all "es2ects, as they + #ld "es2ecti&ely be e!titled t a!d 2laced i! i' the am #!t ' the cheA#e had bee! 2aid t a!d "ecei&ed by the t"#e +!e" the"e '$ 129. Pa2#e"t of cro$$ed che6&e o&t of d&e co&r$e A!y ba!<e" 2ayi!g a cheA#e c" ssed ge!e"ally the"+ise tha! t a ba!<e", " a cheA#e c" ssed s2ecially the"+ise tha! t the ba!<e" t +h m the same is c" ssed, " his age!t ' " c llecti !, bei!g a ba!<e", shall be liable t the t"#e +!e" ' the cheA#e ' " a!y l ss he may s#stai! +i!g t the cheA#e ha&i!g bee! s 2aid$ 1%9. ,he6&e :eari"5 1"ot "e5otia: e1 A 2e"s ! ta<i!g a cheA#e c" ssed ge!e"ally " s2ecially, bea"i!g i! eithe" case the + "ds ;! t !eg tiable;, shall ! t ha&e a!d shall ! t be ca2able ' gi&i!g, a bette" title t the cheA#e tha! that +hich the 2e"s ! '" m +h m he t < it had$ 1%1. No"- ia:i it2 of :a";er recei=i"5 !a2#e"t of che6&e A ba!<e" +h has i! g d 'aith a!d +ith #t !eglige!ce "ecei&ed 2ayme!t ' " a c#st me" ' a cheA#e c" ssed ge!e"ally " s2ecially t himsel' shall ! t, i! case the title t the cheA#e 2" &es de'ecti&e, i!c#" a!y liability t the t"#e +!e" ' the cheA#e by "eas ! !ly ' ha&i!g "ecei&ed s#ch 2ayme!t$ ,,*E%2la!ati !( A ba!<e" "ecei&es 2ayme!t ' a c" ssed cheA#e ' " a c#st me" +ithi! the mea!i!g ' this secti ! ! t+ithsta!di!g that he c"edits his c#st me"?s acc #!t +ith the am #!t ' the cheA#e be' "e "ecei&i!g 2ayme!t the"e '$. ,0*1,1A$ A22licati ! ' cha2te" t d"a'ts The 2" &isi !s ' this cha2te" shall a22ly t a!y d"a't, as de'i!ed i! secti ! 8:A, as i' the d"a't +e"e a cheA#e$

'( *ILLS IN SE)S 1%2. Set of :i $ Bills ' e%cha!ge may be d"a+! i! 2a"ts, each 2a"t bei!g !#mbe"ed a!d c !tai!i!g a 2" &isi ! that it shall c !ti!#e 2ayable !ly s l !g as the the"s "emai! #!2aid$ All the 2a"ts t gethe" ma<e a set/ b#t the +h le set c !stit#tes !ly !e bill, a!d is e%ti!g#ished +he! !e ' the 2a"ts ' a se2a"ates bill, + #ld be e%ti!g#ished$ E%ce2ti !( Bhe! a 2e"s ! acce2ts " e!d "ses di''e"e!t 2a"ts ' the bill i! 'a& #" ' di''e"e!t 2e"s !, he a!d the s#bseA#e!t e!d "se"s ' each 2a"t a"e liable ! s#ch 2a"t as i' it +e"e a se2a"ate bill$ 1%%. -o der of fir$t ac6&ired !art e"tit ed to a As bet+ee! h lde"s i! d#e c #"se ' di''e"e!t 2a"ts ' the same set, he +h 'i"st acA#i"ed title t his 2a"t is e!titled t the the" 2a"ts a!d the m !ey "e2"ese!ted by the bill$

'( IN)ERNA)I'NAL LA< 1%0. La8 5o=er"i"5 ia:i it2 of #a;er, acce!tor or e"dor$er of forei5" i"$tr&#e"t I! the abse!ce ' a c !t"act t the c !t"a"y, the liability ' the ma<e" " d"a+e" ' a ' "eig! 2" miss "y ! te, bill ' e%cha!ge " cheA#e is "eg#lated i! all esse!tial matte"s by the la+ ' the 2lace +he"e he made the i!st"#me!t, a!d the "es2ecti&e liabilities ' the acce2t " a!d e!d "se" by the la+ ' the 2lace +he"e the i!st"#me!t is made 2ayable$ I &$tratio" A bill ' e%cha!ge +as d"a+! by A i! Cali' "!ia +he"e the "ate ' i!te"est is ): 2e" ce!t, a!d acce2ted by B, 2ayable i! Bashi!gt ! +he"e the "ate ' i!te"est is = 2e" ce!t$ The bill is e!d "sed i! ,:*I!dia., a!d is dish ! #"ed$ A! acti ! ! the bill is b" #ght agai!st B i! 10*I!dia.$ Ce is liable t 2ay i!te"est at the "ate ' = 2e" ce!t, !ly/ b#t i' A is cha"ged as d"a+e", A is liable t 2ay i!te"est at the "ate ' ): 2e" ce!t$ 1%3. La8 of ! ace of !a2#e"t 5o=er"$ di$ho"o&r Bhe"e a 2" miss "y ! te, bill ' e%cha!ge " cheA#e is made 2ayable i! a di''e"e!t 2lace '" m that i! +hich it is made " e!d "sed, the la+ ' the 2lace, +he"e it is made 2ayable dete"mi!es +hat c !stit#tes dish ! #" a!d +hat ! tice ' dish ! #" is s#''icie!t$ I &$tratio" A bill ' e%cha!ge d"a+! a!d e!d "sed i! 10*I!dia., b#t acce2ted 2ayable i! E"a!ce, is dish ! #"ed$ The e!d "see ca#ses it t be 2" tested ' " s#ch dish ! #", a!d gi&es ! tice the"e ' i! acc "da!ce +ith the la+ ' E"a!ce, th #gh ! t i! acc "da!ce +ith the "#les he"ei! c !tai!ed i! "es2ect ' bills +hich a"e ! t ' "eig!$ The ! tice is s#''icie!t$ 1%6. I"$tr&#e"t #ade, etc. o&t of I"dia, :&t i" accorda"ce 8ith the a8 of I"dia I' a !eg tiable i!st"#me!t is made, d"a+!, acce2ted " e!d "sed ,:* #tside I!dia., b#t i! acc "da!ce +ith the ,:*la+ ' I!dia., the ci"c#msta!ce that a!y ag"eeme!t e&ide!ced by s#ch i!st"#me!t is i!&alid acc "di!g t the la+ ' the c #!t"y +he"ei! it +as e!te"ed i!t d es ! t i!&alidate a!y s#bseA#e!t acce2ta!ce " e!d "seme!t made the"e ! ,:*+ithi! I!dia.$ 1%7. Pre$&#!tio" a$ to forei5" a8 The la+ ' a!y ' "eig! c #!t"y ,=*---. "ega"di!g 2" miss "y ! te, bills ' e%cha!ge a!d cheA#es shall be 2"es#med t be the same as that ' ,3*I!dia., #!less a!d #!til the c !t"a"y is 2" &ed$

'( PENAL)IES IN ,ASE '( +IS-'N'/R '( ,ER)AIN ,-E./ES ('R INS/((I,IEN,Y '( (/N+S IN )-E A,,'/N)S 1%8. +i$ho"o&r of che6&e for i"$&fficie"c2, etc., of f&"d$ i" the acco&"t$ Bhe"e a!y cheA#e d"a+! by a 2e"s ! ! a! acc #!t mai!tai!ed by him +ith a ba!<e" ' " 2ayme!t ' a!y am #!t ' m !ey t a! the" 2e"s ! '" m #t ' that acc #!t ' " the discha"ge, i! +h le " i! 2a"t, ' a!y debt " the" liability, is "et#"!ed by the ba!< #!2aid, eithe" beca#se ' the am #!t ' m !ey sta!di!g t the c"edit ' that acc #!t is i!s#''icie!t t h ! #" the cheA#e " that it e%ceeds the am #!t a""a!ged t be 2aid '" m that acc #!t by a! ag"eeme!t made +ith that ba!<, s#ch 2e"s ! shall be deemed t ha&e c mmitted a! ''e!ce a!d shall +ith #t 2"eD#dice t a!y the" 2" &isi !s ' this Act, be 2#!ished +ith im2"is !me!t ' " a te"m +hich may e%te!d t !e yea", " +ith 'i!e +hich may e%te!d t t+ice the am #!t ' the cheA#e, " +ith b th( 1RO6I7E7 that ! thi!g c !tai!ed i! this secti ! shall a22ly #!less9 4a5 the cheA#e has bee! 2"ese!ted t the ba!< +ithi! a 2e"i d ' si% m !ths '" m the date ! +hich it is d"a+! " +ithi! the 2e"i d ' its &alidity, +hiche&e" is ea"lie"$

4b5 the 2ayee " the h lde" i! d#e c #"se ' the cheA#e, as the case may be, ma<es a dema!d ' " the 2ayme!t ' the said am #!t ' m !ey by gi&i!g a ! tice, i! +"iti!g, t the d"a+e" ' the cheA#e, +ithi! 'i'tee! days ' the "ecei2t ' i!' "mati ! by him '" m the ba!< "ega"di!g the "et#"! ' the cheA#e as #!2aid, a!d 4c5 the d"a+e" ' s#ch cheA#e 'ails t ma<e the 2ayme!t ' the said am #!t ' m !ey t the 2ayee ", as the case may be, t the h lde" i! d#e c #"se ' the cheA#e, +ithi! 'i'tee! days ' the "ecei2t ' the said ! tice$ E%2la!ati !( E " the 2#"2 se ' this secti !, ;debt " the" liability; mea!s a legally e!' "ceable debt " the" liability$ 1%9. Pre$&#!tio" i" fa=o&r of ho der It shall be 2"es#med, #!less the c !t"a"y is 2" &ed, that the h lde" ' a cheA#e "ecei&ed the cheA#e ' the !at#"e "e'e""ed t i! secti ! 1,8 ' " the discha"ge, i! +h le " i! 2a"t, " a!y debt " the" liability$ 109. +efe"ce 8hich #a2 "ot :e a o8ed i" a"2 !ro$ec&tio" &"der $ectio" 1%8 It shall ! t be a de'e!ce i! a 2" sec#ti ! ' a! ''e!ce #!de" secti ! 1,8 that the d"a+e" had ! "eas ! t belie&e +he! he iss#ed the cheA#e that the cheA#e may be dish ! #"ed ! 2"ese!tme!t ' " the "eas !s stated i! that secti !$ 101. 'ffe"ce$ :2 co#!a"ie$ 415 I' the 2e"s ! c mmitti!g a! ''e!ce #!de" secti ! 1,8 is a c m2a!y, e&e"y 2e"s ! +h , at the time the ''e!ce +as c mmitted, +as i! cha"ge ', a!d +as "es2 !sible t the c m2a!y ' " the c !d#ct ' the b#si!ess ' the c m2a!y, as +ell as the c m2a!y, shall be deemed t be g#ilty ' the ''e!ce a!d shall be liable t be 2" ceeded agai!st a!d 2#!ished acc "di!gly( 1RO6I7E7 that ! thi!g c !tai!ed i! this s#b9secti ! shall "e!de" a!y 2e"s ! liable t 2#!ishme!t i' he 2" &es that the ''e!ce +as c mmitted +ith #t his <! +ledge, " that he had e%e"cised all d#e dilige!ce t 2"e&e!t the c mmissi ! ' s#ch ''e!ce$ 4)5 N t+ithsta!di!g a!ythi!g c !tai!ed i! s#b9secti ! 415, +he"e a!y ''e!ce #!de" this Act, has bee! c mmitted by a c m2a!y a!d it is 2" &ed that the ''e!ce has bee! c mmitted +ith the c !se!t " c !!i&a!ce ', " is att"ib#table t , a!y !eglect ! the 2a"t ', a!y di"ect ", ma!age", sec"eta"y " the" ''ice" ' the c m2a!y, s#ch di"ect ", ma!age", sec"eta"y " the" ''ice" shall als be deemed t be g#ilty ' that ''e!ce a!d shall be liable t be 2" ceeded agai!st a!d 2#!ished acc "di!gly$ E%2la!ati !( E " the 2#"2 se ' this secti ! 4a5 ;c m2a!y; mea!s a!y b dy c "2 "ate a!d i!cl#des a 'i"m " the" ass ciati ! ' i!di&id#als/ a!d 4b5 ;di"ect ";, i! "elati!g t a 'i"m, mea!s a 2a"t!e" i! the 'i"m$ 102. ,o5"i$a"ce of offe"ce$ N t+ithsta!di!g a!ythi!g c !tai!ed i! the C de ' C"imi!al 1" ced#"e, 183, 4) ' 18305,9 4a5 ! c #"t shall ta<e c g!isa!ce ' a!y ''e!ce 2#!ishable #!de" secti ! 1,8 e%ce2t #2 ! a c m2lai!t, i! +"iti!g, made by the 2ayee ", as the case may be, the h lde" i! d#e c #"se ' the cheA#e/ 4b5 s#ch c m2lai!t is made +ithi! !e m !th ' the date ! +hich the ca#se 9 '9 acti ! a"ises #!de" cla#se 4c5 ' the 2" &is t secti ! 1,8/ 4c5 ! c #"t i!'e"i " t that ' a Met" 2 lita! Magist"ate " a @#dicial Magist"ate ' the 'i"st class shall t"y a!y ''e!ce 2#!ishable #!de" secti ! 1,8$ S,-E+/LE @ ENA,)MEN) REPEALE+ [Re!. :2 the A#e"di"5 Act, 1891 B12C of 1891C, $ec. 2 a"d Sch. 1, Pt. I].

('') N')ES 1 The Act has bee! e%te!ded t G a, 7ama!, a!d 7i# by Reg#lati ! 1) ' 18=), a!d t 7ad"a a!d Naga" Ca&eli +$e$'$ 1st$ @#ly, 18=: by Reg#lati ! N $ = ' 18=,$ ) S#bstit#ted by the AO 18:> ' " the + "ds ;all the 1" &i!ces ' I!dia;$ , The + "ds ;e%ce2t the State ' @amm# a!d Hashmi"; mitted by Act N $ =) ' 18:=$ 0 See ! + the Rese"&e Ba!< ' I!dia Act, 18,0 : 7e'i!iti ! ' ;I!dia; mitted by Act N $ =) ' 18:=$ = S#bstit#ted by Act N $ ,3 ' 18::, ' " the de'i!iti ! ' + "d ;ba!<e"; +$e$'$ 1st$ A2"il, 18:=$ 3 7e'i!iti ! ' ;! ta"y 2#blic; mitted by Act N $ :, ' 18:) +$e$'$ 10th$ Eeb"#a"y, 18:=$ 8 S#bstit#ted by Act N $ ) ' 188:, ' " the + "ds ;Bhe! acce2ta!ce is "e'#sed a!d the bill is 2" tested ' " ! !9acce2ta!ce;$ 8 S#bstit#ted ' " the + "ds ;2ayable t , " t the "de" ', a 2ayee; by Act N $ 8 ' 1818$ 1> S#bstit#ted by Act N $ ,= ' 18:3, ' " the + "ds ;a State;$ 11 S#bstit#ted by Act N $ 8 ' 1818$ 1) Added by Act N $ : ' 1810$ 1, Secti ! 1= "e!#mbe"ed as s#b9secti ! 415 a!d s#b9secti ! 4)5 added by Act N $ : ' 1810$ 10 S#bstit#ted by Act N $ , ' 18:1 ' " the + "ds ;the States;$ 1: The B "ds ;Ne+9Iea"?s day, Ch"istmas day( i' eithe" ' s#ch days 'alls ! a S#!day, the !e%t ' ll +i!g M !day/ G d9E"iday/; mitted by Act N $ ,3 ' 18:: +$e$'$ 1st$ A2"il, 18:=$ 1= S#bstit#ted by the AO 18,3, ' " ;LG;$ 13 I!se"ted by Act N $ ) ' 188:$ 18 S#bstit#ted ' " + "ds ;2ayable t the "de" ' a s2eci'ied 2e"s !, " t a s2eci'ied 2e"s ! ! "de"; by Act N $ 8 ' 1818$ 18 S#bstit#ted by Act N $ 1) ' 18)1 ' " the + "ds ;t+e!ty9' #";$ )> I!se"ted by Act N $ = ' 1883$ )1 I!se"ted by Act N $ ): ' 18)>$ )) I!se"ted by Act N $ 1) ' 18)1$ ), S#bstit#ted by Act N $ ,> ' 18)=, ' " the + "ds ;e%ce2t i! cases 2" &ided ' " by the C de ' Ci&il 1" ced#"e;$ )0 S#bstit#ted by Act N $ == ' 1888 ' " the + "ds ;si% 2e" ce!t#m;, +$e$'$ ,>th$ 7ecembe", 1888$ ): S#bstit#ted by Act N $ = ' 1883$ )= Secti ! 8: "e9!#mbe"ed as s#b9secti ! 415 a!d s#b9secti ! 4)5, added by Act N $ 13 ' 18,0$ )3 Sec !d se!te!ce mitted by Act N $ ) ' 188:$ )8 S#bstit#ted by Act N $ ) ' 188:, ' " the + "ds ;i! the 2"ese!ce ' a ! ta"y 2#blic, s#bsc"ibe the bill +ith his +! ha!d, a!d;$

)8 The + "ds ;a!d s#ch decla"ati ! m#st be "ec "ded by the ! ta"y i! his "egiste"; mitted by Act N $ ) ' 188:$ ,> The + "ds, 'ig#"e a!d b"ac<ets ;4e%ce2t i! cases 2" &ided ' " by the C de ' Ci&il 1" ced#"e, s$ :,)5; mitted by Act N $ ,> ' 18)=$ ,1 S#bstit#ted by Act N $ == ' 1888 ' " ;si% 2e" ce!t#m; +$e$'$ ,>th$ 7ecembe", 1888$ ,) S#bstit#ted by Act N $ 8 ' 1818 ' " the + "ds ;2ayable t , " t the "de" ', a s2eci'ied 2e"s !;$ ,, Added by Act N $ 18 ' 18))$ ,0 Added by Act N $ ,, ' 1803$ ,: Ce"tai! + "ds +e"e s#ccessi&ely ame!ded by the AO 1808, the AO 18:> a!d Act N $ , ' 18:1$ ,= The + "ds ; " the State ' @amm# a!d Hashmi"; mitted by Act N $ =) ' 18:=$ ,3 The + "ds ;B"itish I!dia; has bee! s#ccessi&ely s#bstit#ted by the AO 1808, AO 18:> a!d Act N $ , ' 18:1 t "ead as ab &e$ ,8 I!se"ted by Act N $ == ' 1888, +$e$'$ 19091888$ Ea"lie" Cha2te" J6II "elati!g t ;N ta"ies 1#blic; I!se"ted by Act N $ ) ' 188: +as "e2laced by the N ta"ies Act, 18:) 4:, ' 18:)5 +$e$'$ 10th$ Eeb"#a"y, 18:=$