A signs a writing that says, “On demand, I promise to pay B ₹10,000.” What kind of instrument is it…
Section 4 treats a signed written undertaking to pay a definite sum of money unconditionally to a certain person as a promissory note. A promise payable on demand can meet…
Choose your answer
A signs a writing that says, “On demand, I promise to pay B ₹10,000.” What kind of instrument is it under the Negotiable Instruments Act, 1881?
Answer and explanation
Correct answer C
Section 4 treats a signed written undertaking to pay a definite sum of money unconditionally to a certain person as a promissory note. A promise payable on demand can meet that definition.
Option feedback
Option A
A bill of exchange is an order to pay, whereas A makes a promise.
Option B
The writing contains a promise to pay and goes beyond acknowledging a debt.
Option C
A signed unconditional promise to pay a certain sum to a named person meets Section 4.
Option D
A cheque is drawn on a specified banker, which is absent here.
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