Which section of the NI Act, 1881 justifies the dishonour of the cheque ?
31
Section 31 of the Negotiable Instruments Act, 1881 deals with the liability of the drawee of a cheque. A banker having sufficient funds of the drawer in his hands, properly applicable to the payment of the cheque, must pay it when duly required, and on default must compensate the drawer.
The banker's duty thus arises only when sufficient funds are available and properly applicable and the cheque is duly presented. Where these conditions are absent, for example insufficient funds, the banker is justified in dishonouring the cheque.
Section 28 deals with the liability of an agent signing, Section 29 with the liability of a legal representative, and Section 30 with the liability of the drawer.
Hence, the answer is 31.
Similar Questions
The following one is absolutely essential for a special crossing :
Non-acceptance is a valid mode of dishonour for :
Days of grace under NI Act, 1881 applicable to :
The word ‘negotiation’ was defined in the NI Act, 1881 under Section:
Important Questions from Negotiable instrument Act, 1881
- Which of the following is not a negotiable instrument?
- Match List – I with List – II and select the correct answer using the codes given below :
List – I List – II i. Inchoate stamped instrument a. Union Bank of India Vs. Ankur Corp. ii. Liability of acceptor of a negotiable instrument b. Section 31 of the Negotiable Instrument Act iii. Liability of an endorser c. Section 35 of the Negotiable Instrument Act. iv. Liability of the drawee of a cheque. d. Section 20 of the Negotiable Instrument Act.
Codes : - Which of the following statements are correct ? Answer using codes given below :
In order that a person can be called a holder in due course, he must show :
i. that he is the drawer of the negotiable instrument.
ii. that he has obtained it without consideration.
iii. that he has obtained it before the maturity of the negotiable instrument.
iv. that he has obtained the negotiable instrument in good faith.
Codes : - Read Assertion (A) and Reason (R) and answer using code below :
Assertion (A) : Where a bill is unintentionally cancelled by the holder or his agent and the cancellation is not apparent thereon, the bill is discharged.
Reason (R) : Above principle is laid down in Section 82 of the Negotiable Instruments Act.
Code : - Which one of the following statements is true ?
