Question
Which of the following statement is correct ?
The correct answer is
A 16 year old girl can draw a cheque
Analyzing Cheque and Negotiable Instrument Statements
The question asks to identify the correct statement regarding cheques and negotiable instruments.
Statement Analysis
- Option 1: Incorrect. Open cheques can be presented directly to the drawee bank for payment across the counter. This statement incorrectly describes open cheques.
- Option 2: Correct. Under Section 26 of the Negotiable Instruments Act, 1881, a minor is competent to draw, make, deliver, and endorse negotiable instruments. While a minor incurs no personal liability on such an instrument, they are legally capable of drawing it. Therefore, a 16-year-old girl (a minor) can draw a cheque.
- Option 3: Incorrect. Indorsement, which is the act of signing the back of a cheque to transfer ownership or for other purposes, is typically written on the back (verso) of the cheque, not the front.
- Option 4: Incorrect. The holder of a negotiable instrument is the person entitled to endorse it. Indorsement is a primary function performed by the holder to transfer rights in the instrument.
Conclusion
Based on the legal provisions governing negotiable instruments, specifically concerning the capacity of minors, the statement that a 16-year-old girl can draw a cheque is correct.
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Important Questions from Negotiable Instruments Act, 1881
Which one among the following is not a privilege or right of a holder-in-due course under Negotiable Instruments Act?
Which one of the following statements is correct regarding the Negotiable Instruments Act in India?
- Arrange chronologically, the important committees that recommended changes to the Companies Act :
1. Naresh Chandra Committee
2. Vaish Committee
3. Sachar Committee
4. Bhabha Committee
5. Company Law Committee Match List-I with List-II and select the correct answer using codes given below :
Answer in context of the Negotiable Instruments Act.
List-I List-II (a) Time and place for presentment (i) Section 19 (b) Cheques are payable in demand (ii) Section 8 (c) Holder of a negotiable instrument (iii) Section 61 (d) Fictitious drawer or payee (iv) Section 42
Codes:- Match List - I with List - II and select the correct answer using the codes given below :
List - I List - II (a) Kundan Lal Rallaram Vs. Custodian (i) Presumption under section 118 of the Negotiable Instrument Act arises only if the execution of the document is proved as true (b) C.T. Joseph Vs. I.V. Phillip (ii) Burden of proof of failure of consideration for a negotiable instrument (c) A.V. Murthy Vs. B.S. Nagabasavanna (iii) A negotiable instrument is presumed to be drawn for consideration (d) Beni Madhavnath Vs. Jugandra Nath Balwan (iv) The statutory presumption envisaged under section 118(a) of the Negotiable Instrument Act is rebuttable.
Codes:(a) (b) (c) (d)
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