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Which of these matters are covered by the rebuttable presumptions in section 118 of the Negotiable…

Section 118(a) presumes consideration for making or drawing the instrument and for the listed subsequent dealings. Section 118(b) presumes that an instrument bearing a date…

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Which of these matters are covered by the rebuttable presumptions in section 118 of the Negotiable Instruments Act, 1881?

I. Consideration

II. The date of a dated instrument

III. The time of acceptance of an accepted bill of exchange

Select one answer
Answer and explanation

Correct answer D

Section 118(a) presumes consideration for making or drawing the instrument and for the listed subsequent dealings.

Section 118(b) presumes that an instrument bearing a date was made or drawn on that date.

Section 118(c) presumes acceptance of an accepted bill of exchange within a reasonable time after its date and before maturity. Each presumption is rebuttable.

Option feedback

Option A

Consideration and date are covered, and so is the time of acceptance of an accepted bill.

Option B

Consideration and time of acceptance are covered, and so is the date of a dated instrument.

Option C

Date and time of acceptance are covered, and so is consideration.

Option D

Clauses (a), (b) and (c) cover all three stated matters.

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