Which description fits a "cheque in the electronic form" under Explanation I to section 6 of the Negotiable Instruments Act, 1881?
Question and options
Which description fits a "cheque in the electronic form" under Explanation I to section 6 of the Negotiable Instruments Act, 1881?
A payment order sent through a bank's mobile application and confirmed with a PIN
A paper cheque whose scanned copy the drawer sends to the payee by email
A paper cheque whose image is captured and sent on by the bank during the clearing cycle
A cheque drawn on a computer resource and digitally signed in a secure system
Answer and explanation
Explanation I(a) to section 6 of the Negotiable Instruments Act, 1881 defines a cheque in the electronic form as one drawn in electronic form using any computer resource and signed in a secure system with a digital signature and asymmetric crypto system, or with an electronic signature. A paper cheque imaged during clearing is a "truncated cheque" under Explanation I(b), and an app payment order or emailed scan is not a cheque at all.
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