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Question

Which one of the following is not the essential requirement to fulfil an instrument intended to be a Promissory Note ?

The correct answer is
A mere acknowledgement of indebtedness is sufficient.

To determine if an instrument qualifies as a Promissory Note, specific essential requirements must be met. Let's analyze the given options against these requirements.

Promissory Note Essential Requirements

An instrument is considered a Promissory Note if it meets the following criteria:

  • It must be in writing.
  • It must contain an express promise to pay a certain sum of money.
  • The promise must be unconditional.
  • It must be signed by the person making the promise (the maker).
  • The sum payable must be a certain sum of money.
  • It must be payable either on demand or at a fixed or determinable future time.
  • It must be payable to a specified person or to the bearer of the instrument.

Analysis of Options

Let's evaluate each option provided:

  • Option 1: The instrument must contain a promise to pay. This is a fundamental requirement. A promissory note fundamentally involves a promise.
  • Option 2: A mere acknowledgement of indebtedness is sufficient. This is not sufficient. While acknowledging a debt might be part of the context, a promissory note specifically requires an explicit promise to pay, not just an admission of owing money.
  • Option 3: The sum of money to be paid must be certain. This is essential. The note must clearly state the exact amount to be paid.
  • Option 4: Promise to pay must be unconditional. The promise to pay should not be subject to any uncertain future conditions.

Conclusion

Based on the essential requirements, a mere acknowledgement of indebtedness is not enough to make an instrument a Promissory Note. An explicit and unconditional promise to pay a certain sum is required.

Therefore, the statement that is not an essential requirement is that a mere acknowledgement of indebtedness is sufficient.

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Important Questions from Negotiable Instruments Act, 1881

  1. Which one among the following is not a privilege or right of a holder-in-due course under Negotiable Instruments Act?

  2. Which one of the following statements is correct regarding the Negotiable Instruments Act in India?

  3. The section of holder in due course is

  4. The bank can refuse to make payment if the cheque is

  5. What is the primary liability of the drawer of a bill of exchange or cheque?

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