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THE NEGOTIABLE INSTRUMENTS ACT,
1881
(ACT NO. XXVI OF 1881).
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[9th December, 1881]
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1 An Act to define and amend the law
relating to Promissory Notes, Bills of Exchange and Cheques.
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Preamble
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WHEREAS it is expedient to define
and amend the law relating to promissory notes, bills of exchange and
cheques; It is hereby enacted as follows:-
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CHAPTER I
PRELIMINARY
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Short title
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Commencement
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It extends to the whole of
Bangladesh; but nothing herein contained affects the provisions of 2[ Articles 23 and 24
of the Bangladesh Bank Order, 1972]; and it shall come
into force on the first day of March, 1882.
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Application of the Act
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3[ 1A. Every negotiable
instrument shall be governed by the provisions of this Act, and no usage or
custom at variance with any such provision shall apply to any such
instrument.]
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[Repealed]
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2. [Repealed by the Amending Act,
1891 (Act No. XII of 1891).]
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Interpretation-clause
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3. In this Act, unless there is
anything repugnant in the subject or context,-
(a) “accommodation party” means a person who has signed a negotiable
instrument as a maker, drawer, acceptor or indorser without receiving the
value thereof and for the purpose of lending his name to some other person;
(b) “banker” means a person transacting the business of accepting, for the
purpose of lending or investment, of deposits of money form the public,
repayable on demand or otherwise and withdrawable by cheque, draft, order
or otherwise, and includes any Post Office Savings Bank;
(c) “bearer” means a person who by negotiation comes into possession of a
negotiable instrument, which is payable to bearer;
(d) “delivery” means transfer of possession, actual or constructive, from
one person to another;
(e) “issue” means the first delivery of a promissory note, bill of exchange
or cheque complete in form to a person who takes it as a holder;
(f) “material alteration” in relation to a promissory note, bill of
exchange or cheque includes any alteration of the date, the sum payable,
the time of payment, the place of payment, and, where any such instrument
has been accepted generally, the addition of a place of payment without the
acceptor's assent; and
(g) “notary public” includes any person appointed by the Government to
perform the functions of notary public under this Act and a notary
appointed under the Notaries Ordinance,
1961.
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CHAPTER II
OF NOTES, BILLS AND CHEQUES
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“Promissory note”
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4. A “promissory note” is an
instrument in writing (not being a bank-note or a currency-note) containing
an unconditional undertaking, signed by the maker, to pay on demand or at a
fixed or determinable future time a certain sum of money only to, or to the
order of, a certain person, or to the bearer of the instrument.
Illustrations
A signs instruments in the following terms:
(a) “I promise to pay B or order Taka 500.”
(b) “I acknowledge myself to be indebted to B in Taka 1,000 to be paid on
demand, for value received.”
(c) “Mr. B, I O U Taka 1,000.”
(d) “I promise to pay B Taka 500 and all other sums which shall be due to
him.”
(e) “I promise to pay B Taka 500, first deducting thereout any money which
he may owe me.”
(f) “I promise to pay B Taka 500 seven days after my marriage with C.”
(g) “I promise to pay B Taka 500 on D's death, provided D leaves me enough
to pay that sum.”
(h) “I promise to pay B Taka 500 and to deliver to him may black horse on
1st January next.”
The instruments respectively marked (a) and (b) are promissory notes. The
instruments respectively marked (c), (d), (e), (f), (g) and (h) are not
promissory notes.
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“Bill of exchange”
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5. A “bill of exchange” is an
instrument in writing containing an unconditional order, signed by the
maker, directing a certain person to pay on demand or at fixed or
determinable future time a certain sum of money only to, or to the order
of, a certain person or to the bearer of the instrument.
A promise or order to pay is not “conditional”, within the meaning of this
section and section 4, by reason of the time for payment of the amount or
any instalment thereof being expressed to be on the lapse of a certain
period after the occurrence of a specified event which, according to the
ordinary expectation of mankind, is certain to happen, although the time of
its happening may be uncertain.
The sum payable may be “certain,” within the meaning of this section and
section 4, although it includes future interest or is payable at an
indicated rate of exchange, or is payable at the current rate of exchange,
and although it is to be paid in stated instalments and contains a
provision that on default of payment of one or more instalments or
interest, the whole or the unpaid balance shall become due.
Where the person intended can reasonably be ascertained from the promissory
note or the bill of exchange, he is a “certain person” within the meaning
of this section and section 4, although he is misnamed or designated by
description only.
An order to pay out of a particular fund is not unconditional within the
meaning of this section; but an unqualified order to pay, coupled with-
(a) an indication of a particular fund out of which the drawee is to
reimburse himself or a particular account to be debited to the amount, or
(b) a statement of the transaction which gives rise to the note or bill, is
unconditional.
Where the payee is a fictitious or non-existing person the bill of exchange
may be treated as payable to bearer.
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“Cheque”
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6. A “cheque” is a bill of exchange
drawn on a specified banker and not expressed to be payable otherwise than
on demand.
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“Drawer” “Drawee” “Drawee in case
of need” “Acceptor” “Acceptor for honour” “Payee”
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7. The maker of a bill of exchange
or cheque is called the “drawer;” the person thereby directed to pay is
called the “drawee.”
When in the bill or in any indorsement thereon the name of any person is
given in additional to the drawee to be resorted to in case of need, such
person is called a “drawee in case of need.”
After the drawee of a bill has signed his assent upon the bill, or, if
there are more parts thereof than one, upon one of such parts, and
delivered the same, or given notice of such signing to the holder or to
some person on his behalf, he is called the “acceptor”.
When a bill of exchange has been noted or protested for non-acceptance or
for better security, and any person accepts it supra protest for honour of
the drawer or of any one of the indorsers, such person is called an
“acceptor for honour.” “Acceptor for honour”
The person named in the instrument, to whom or to whose order the money is
by the instrument directed to be paid, is called the “payee”.
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“Holder”
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“Payee”
8. The “holder” of a promissory note, bill of exchange or cheque means the
payee or indorsee who is in possession of it or the bearer thereof but does
not include a beneficial owner claiming through a benamidar. “Holder”
Explanation - Where the note, bill or cheque is lost and not found
again, or is destroyed, the person in possession of it or the bearer
thereof at the time of such loss or destruction shall be deemed to continue
to be its holder.
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“Holder in due course”
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9. “Holder” in due course” means
any person who for consideration becomes the possessor of a promissory
note, bill of exchange or cheque if payable to bearer, or the payee or
indorsee thereof, if payable to order, before it became overdue, without
notice that the title of the person from whom he derived his own title was
defective. “Holder in
due course”
Explanation - For the purposes of this section the title of a person
to a promissory note, bill of exchange or cheque is defective when he is
not entitled to receive the amount due thereon by reason of the provisions
of section 58.
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“Payment in due course”
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10. “Payment in due course” means
payment in accordance with the apparent tenor of the instrument in good
faith and without negligence to any person in possession thereof under
circumstances which do not afford a reasonable ground for believing that he
is not entitled to receive payment of the amount therein mentioned.
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Inland instrument
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11. A promissory note, bill of
exchange or cheque drawn or made in Bangladesh, and made payable in, or
drawn upon any person resident in, Bangladesh shall be deemed to be an
inland instrument.
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Foreign instrument
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12. Any such instrument not so
drawn, made or made payable shall be deemed to be a foreign instrument.
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“Negotiable instrument”
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13.(1) A “negotiable instrument”
means a promissory note, bill of exchange or cheque payable either to order
or to bearer.
Explanation (i) - A promissory note, bill of exchange or cheque is
payable to order which is expressed to be so payable or which is expressed
to be payable to a particular person, and does not contain words
prohibiting transfer or indicating an intention that it shall not be
transferable.
Explanation (ii) - A Promissory note, bill of exchange or cheque is
payable to bearer which is expressed to be so payable or on which the only
or last indorsement is an indorsement in blank.
Explanation (iii) - Where a promissory note, bill of exchange or
cheque either originally or by indorsement, is expressed to be payable to
the order of a specified person, and not to him or his order, it is
nevertheless payable to him or his order at his option.
(2) A negotiable instrument may be made payable to two or more payees
jointly or it may be made payable in the alternative to one of two, or one
or some of several payees.
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Negotiation
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14. When a promissory note, bill of
exchange or cheque is transferred to any person, so as to constitute that
person the holder thereof, the instrument is said to be negotiated.
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Indorsement
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15. When the maker or holder of a
negotiable instrument signs the same, otherwise than as such maker, for the
purpose of negotiation, on the back or face thereof or on a slip of paper
annexed thereto, or so signs for the same purpose a stamped paper intended
to be completed as a negotiable instrument, he is said to indorse the same,
and is called the “indorser”.
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Indorsement “in blank” and “in
full” “Indorsee”
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16. (1) If the indorser signs his
name only, the indorsement is said to be “in blank”, and if he adds a
direction to pay the amount mentioned in the instrument to, or to the order
of, a specified person, the indorsement is said to be “in full”, and the
person so specified is called the “indorsee” of the instrument.
(2) The provisions of this Act relating to a payee shall apply with the
necessary modifications to an indorsee.
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Ambiguous instruments
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17. Where an instrument may be
construed either as a promissory note or bill of exchange, the holder may at
his election treat it as either, and the instrument shall be thenceforward
treated accordingly.
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Where amount is stated differently
in figures and words
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18. If the amount undertaken or
ordered to be paid is stated differently in figures and in words, the
amount stated in words shall be the amount undertaken or ordered to be
paid:
Provided that if the words, are ambiguous or uncertain, the amount may be
ascertained by referring to the figures.
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Instruments payable on demand
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19. A promissory note or bill of
exchange is payable on demand,-
(a) where it is expressed to be so, or to be payable at sight or on
presentment; or
(b) where no time for payment is specified in it; or
(c) where the note or bill accepted or indorsed after it is overdue, as
regards the person accepting or indor-sing it.
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Inchoate stamped instruments
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20.(1) Where one person signs and
delivers to another a paper stamped in accordance with the law relating to
stamp duty chargeable on negotiable instruments, either wholly blank or
having written thereon an incomplete negotiable instrument, in order that
it may be made, or completed into a negotiable instrument he thereby gives
prima facie authority to the person who receives that paper to make or
complete it, as the case may be, into a negotiable instrument for the
amount, if any, specified therein, or, where no amount is specified for any
amount, not exceeding, in either case, the amount covered by the stamp.
(2) The person so signing shall, subject to the provisions of sub-section
(3), be liable upon such instrument, in the capacity in which he signed the
same, to any holder in due course, for the amount specified in the
instrument or filled up therein:
Provided that no person other than a holder in due course shall receive
from the person so signing the paper anything in excess of the amount
intended by him to be paid thereunder.
(3) In order that any such instrument may on completion be enforceable against
any person who became a party thereto before such completion, it must be
filled up within a reasonable time and strictly in accordance with the
authority given:
Provided that if any such instrument after completion is negotiated to a
holder in due course, it shall be valid and effectual for all purposes in
his hands, and he may enforce it as if it had been filled up within a
reasonable time and strictly in accordance with the authority given.
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“At sight” “On presentment” “After
sight”
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21. The expression “after sight”
means, in a promissory note, after presentment for sight, and, in a bill of
exchange, after acceptance, or noting for non-acceptance, or protest for
non-acceptance.
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When note or bill payable on demand
is overdue
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4[ 21A. A promissory
note or bill of exchange payable on demand shall be deemed to be overdue
when it appears on the face of it to have been in circulation for an
unreasonable length of time.
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A note or bill payable at a
determinable future time
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21B. A promissory note or bill of
exchange is payable at a determinable future time within the meaning of
this Act if it is expressed to be payable-
(a) at a fixed time after date or sight; or
(b) on or at a fixed time after the occurrence of a specified event which
is certain to happen, though the time of its happening may be uncertain.
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Anti-dating and post-dating
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21C. A promissory note, bill of
exchange or cheque is not invalid by reason only that it is anti-dated or
post-dated:
Provided that anti-dating or post-dating does not involve any illegal or
fraudulent purpose or transaction.]
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“Maturity” Days of grace
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22. The maturity of a promissory
note or bill of exchange is the date at which it falls due.
Every promissory note or bill of exchange which is not expressed to be
payable on demand, at sight or on presentment is at maturity on the third
day after the day on which it is expressed to be payable.
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Calculating maturity of bill or
note payable so many months after date or sight
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23. In calculating the date at
which a promissory note or bill of exchange, made payable a stated number
of months after date or after sight, or after a certain event, is at
maturity, the period stated shall be held to terminate on the day of the
month which corresponds with the day on which the instrument is dated, or presented
for acceptance or sight, or noted for non-acceptance, or protested for
non-acceptance, or the event happens, or, where the instrument is a bill of
exchange made payable a stated number of months after sight and has been
accepted for honour, with the day on which it was so accepted. If the month
in which the period would terminate has no corresponding day, the period
shall be held to terminate on the last day of such month.
Illustrations
(a) A negotiable instrument, dated 29th January, 1878, is made payable at
one month after date. The instrument is at maturity on the third day after
the 28th February, 1878.
(b) A negotiable instrument, dated 30th August 1878, is made payable three
months after date. The instrument is at maturity on the 3rd December, 1878.
(c) A promissory note or bill of exchange, dated 31st August, 1878, is made
payable three months after date. The instrument is at maturity on the 3rd
December, 1878.
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Calculating maturity of bill or
note payable so many days after date or sight
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24. In calculating the date at
which a promissory note or bill of exchange made payable a certain number
of days after date or after sight or after a certain event is at maturity,
the day of the date, or of presentment for acceptance or sight, or of
protest for non-acceptance, or on which the event happens, shall be
excluded.
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When day of maturity is a holiday
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25. When the day on which a
promissory note or bill of exchange is at maturity is a public holiday, the
instrument shall be deemed to be due on the next preceding business day.
Explanation - The expression “public holiday” includes Sundays and
the days declared by the Government, by notification in the official
Gazette, to be public holidays.
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CHAPTER III
PARTIES TO NOTES, BILLS AND CHEQUES
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Capacity to make, etc, promissory
notes, etc
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26. Every person capable of
contracting, according to the law to which he is subject, may bind himself
and be bound by the making, drawing, acceptance, indorsement, delivery and
negotiation of a promissory note, bill of exchange or cheque.
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Minor
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Where such an instrument is made,
drawn or negotiated by a minor, the making, drawing or negotiation entitles
the holder to receive payment of such instrument and to enforce it against
any party thereto other than the minor.
Nothing herein contained shall be deemed to empower a corporation to make,
indorse or accept such instruments except in cases in which, under the law
for the time being in force, they are so empowered.
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Agency
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27. Every person capable of binding
himself or of being bound, by the making, drawing, acceptance or
negotiation of a negotiable instrument, may so bind himself or be bound by
a duly authorised agent acting in his name.
A general authority to transact business and to receive and discharge debts
does not confer upon an agent the power of accepting or indorsing bills of
exchange so as to bind his principal.
An authority to draw bills of exchange does not of itself import an
authority to indorse.
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Authority of partner
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5[ 27A. A partner
acting in the firm name may bind the firm by the making, drawing,
acceptance or negotiation of a negotiable instrument to the extent
authorised by law relating to partnership for the time being in force.]
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Liability of agent signing
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28.(1) Where a person signs a
promissory note, bill of exchange or cheque without adding to his signature
words indicating that he signs it as an agent for and on behalf of a
principal or in a representative character, he is personally liable thereon
but the mere addition to his signature of words describing him as an agent
or as filling a representative character does not exempt him from personal
liability.
(2) Notwithstanding anything contained in sub-section (1), any person
signing a promissory note, bill of exchange or cheque for and on behalf of
the principal is not liable to a person who induces him to sign upon the
belief that the principal alone would be held liable.
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Transferor by delivery and
transferee
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6[ 28A.(1) Where the
holder of a negotiable instrument payable to bearer negotiates it by
delivery without indorsing it, he is called a “transferor by delivery”.
(2) A transferor by delivery is not liable on the instrument.
(3) A transferor by delivery who negotiates a negotiable instrument thereby
warrants to his immediate transferee, being a holder for consideration,
that the instrument is what it purports to be, that he has a right to
transfer it, and that at the time of transfer he is not aware of any defect
which renders it valueless.]
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Liability of legal representative
signing
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29. A legal representative of a
deceased person who signs his name to a promissory note, bill of exchange
or cheque is liable personally thereon unless he expressly limits his
liability to the extent of the assets received by him as such.
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Signature essential to liability
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29A. No person is liable as maker,
drawer, indorser or acceptor of a promissory note, bill of exchange or
cheque who has not signed it as such:
Provided that where a person signs any such instrument in a trade or
assumed name he is liable thereon as if he had signed it in his own name.
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Forged or unauthorised signature
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29B. Subject to the provisions of
this Act, where a signature on a promissory note, bill of exchange or
cheque is forged or placed thereon without the authority of the person
whose signature it purports to be, the forged or unauthorised signature is
wholly inoperative, and no right to retain the instrument or to give a
discharge therefor or to enforce payment thereof against any party thereto
can be acquired through or under that signature, unless the party against
whom it is sought to retain or enforce payment of the instrument is
precluded from setting up the forgery or want of authority:
Provided that nothing in this section shall effect the ratification of an
unauthorised signature not amounting to a forgery.
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Stranger signing instrument
presumed to be indorser
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29C. A person placing his signature
upon a negotiable instrument otherwise than as maker, drawer or acceptor is
presumed to be an indorser unless he clearly indicates by appropriate words
his intention to be bound in some other capacity.]
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Liability of drawer
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30.(1) (a) The drawer of a bill of
exchange by drawing it, engages that on due presentment it shall be
accepted and paid according to its tenor, and that if it be dishonoured, he
will compensate the holder or any indorser who is compelled to pay it; and
(b) the drawer of a cheque by drawing it, engages that in the case of
dishonour by the drawee he will compensate the holder:
Provided that due notice of dishonour of the bill or cheque has been given
to or received by the drawer as hereinafter provided.
(2) The drawee of a bill of exchange is not liable thereon until acceptance
in the manner provided by this Act.
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Liability of drawee of cheque
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31. The drawee of a cheque having
sufficient funds of the drawer in his hands properly applicable to the
payment of such cheque must pay the cheque when duly required so to do,
and, in default of such payment, must compensate the drawer for any loss or
damage caused by such default.
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Liability of maker of note and
acceptor of bill
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32.(1) In the absence of a contract
to the contrary, the maker of a promissory note, by making it, and the
acceptor before maturity of a bill of exchange by accepting it, engages
that he will pay it according to the tenor of the note or his acceptance
respectively, and in default of such payment, such maker or acceptor is
bound to compensate any party to the note or bill or any loss or damage
sustained by him and caused by such default.
(2) The acceptor of a bill of exchange at or after maturity, by accepting
it, engages to pay the amount thereof to the holder on demand.
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Only drawee can be acceptor except
in need or for honour
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33. No person except the drawee of
a bill of exchange, or all or some of several drawees, or a person named
therein as a drawee in case of need, or an acceptor for honour, can bind
himself by an acceptance.
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Acceptance by several drawees not
partners
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34. Where there are several drawees
of a bill of exchange who are not partners, each of them can accept it for
himself, but none of them can accept it for another without his authority.
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Liability of indorser
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35. In the absence of a contact to
the contrary, the indorser of a negotiable instrument, by indorsing it,
engages that on due presentment it shall be accepted and paid according to
its tenor and that if it be dishonoured he will compensate the holder or subsequent
indorser who is compelled to pay it for any loss or damage caused to him by
such dishonour.
Every indorser after dishonour is liable as upon an instrument payable on
demand.
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Liability of prior parties to
holder in due course
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36. Every prior party to a
negotiable instrument is liable thereon to a holder in due course until the
instrument is duly satisfied.
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Maker, drawer and accept or
principals
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37. The maker of a promissory note
or cheque, the drawer of a bill of exchange until acceptance, and the
acceptor are, in the absence of a contract to the contrary, respectively
liable thereon as principal debtors, and the other parties thereto are
liable thereon as sureties for the maker, drawer or acceptor, as the case
may be.
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Prior party a principal in respect
of each subsequent party
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38. As between the parties so
liable as sureties, each prior party is, in the absence of a contract to
the contrary, also liable thereon as a principal debtor in respect of each
subsequent party.
Illustration
A draws a bill payable to his own order on B who accepts. A afterwards
indorses the bill to C, C to D, and D to E. As between E and B, B is the
principal debtor, and A, C and D are his sureties. As between E and A, A is
the principal debtor and C and D are his sureties. As between E and C, C is
the principal debtor and D is his surety.
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Liability of accommodation party
and position of accommodation party
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7[ 38A.(1) An
accommodation party is liable on a negotiable instrument to a holder in due
course, notwithstanding that when such holder took the instrument he knew
such party to be an accommodation party.
(2) An accommodation party to a negotiable instrument, if he has paid the
amount thereof, is entitled to recover such amount from the party
accommodated.]
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Suretyship
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39. When the holder of an accepted
bill of exchange enters into any contract with the acceptor which, under
section 134 or 135 of the Contract Act, 1872, would discharge the other
parties, the holder may expressly reserve his right to charge the other
parties, and in such case they are not discharged.
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Discharge of indorser’s liability
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40. When the holder of a negotiable
instrument, without the consent of the indorser, destroys or impairs the
indorser's remedy against a prior party, the indorser is discharged from
liability to the holder to the same extent as if the instrument had been
paid at maturity.
Illustration
A is the holder of a bill of exchange made payable to the order of B, which
contains the following indorsements in blank:-
First indorsement, “B”.
Second indorsement, “Peter Williams.”
Third indorsement, “Wright & Co.”
Fourth indorsement, “John Rozario.”
This bill A puts in suit against John Rozario and strike out, without John
Rozario's consent, the indorsements by Peter Williams, and Wright & Co.
A is not entitled to recover anything from John Rozario.
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Acceptor bound although indorsement
forged
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41. An acceptor of a bill of
exchange already indorsed is not relieved from liability by reason that
such indorsement is forged, if he knew or had reason to believe the
indorsement to be forged when he accepted the bill.
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Acceptance of bill drawn in
fictitious name
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42. An acceptor of a bill of
exchange drawn in a fictitious name and payable to the drawer's order is
not, by reason that such name is fictitious, relieved from liability to any
holder in due course claiming under an indorsement by the same hand as the
drawer's signature, and purporting to be made by the drawer.
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Negotiable instrument made, etc,
without consideration
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43. A negotiable instrument made,
drawn, accepted, indorsed or transferred without consideration, or for a
consideration which fails, creates no obligation of payment between the
parties to the transaction. But if any such party has transferred the
instrument with or without indorsement to a holder for consideration, such
holder, and every subsequent holder deriving title from him, may recover
the amount due on such instrument from the transferor for consideration or
any prior party thereto.
Exception I - No party for whose accommodation a negotiable instrument has
been made, drawn, accepted or indorsed can, if he have paid the amount
thereof, recover thereon such amount from any person who became a party to
such instrument for his accommodation.
Exception II - No party to the instrument who has induced any other party
to make, draw, accept, indorse or transfer the same to him for a consideration
which he has failed to pay or perform in full shall recover thereon an
amount exceeding the value of the consideration (if any) which he has
actually paid or performed.
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Partial absence or failure of
money-consideration
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44. When the consideration for
which a person signed a promissory note, bill of exchange or cheque
consisted of money, and was originally absent in part or has subsequently
failed in part, the sum which a holder standing in immediate relation with
such signer is entitled to receive from him is proportionally reduced.
Explanation - The drawer of a bill of exchange stands in immediate
relation with the acceptor. The maker of a promissory note, bill of
exchange or cheque stands in immediate relation with the payee, and the
indorser with his indorsee. Other signers may by agreement stand in
immediate relation with a holder.
Illustration
A draws a bill on B for Taka 500 payable to the order of A. B accepts the
Bill, but subsequently dishonours it by non-payment. A sues B on the bill.
B proves that it was accepted for value as to Taka 400, and as an
accommodation to the plaintiff as to the residue. A can only recover Taka
400.
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Partial failure of consideration
not consisting of money
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45. Where a part of the
consideration for which a person signed a promissory note, bill of exchange
or cheque, though not consisting of money, is ascertainable in money
without collateral inquiry, and there has been a failure of that part, the
sum which a holder standing in immediate relation with such signer is
entitled to receive from him is proportionally reduced.
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Holder’s right to duplicate of lost
bill
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8[ 45A. Where a bill of
exchange has been lost before it is overdue, the person who was the holder
of it may apply to the drawer to give him another bill of the same tenor,
giving security to the drawer, if required, to indemnify him against all
persons whatever in case the bill alleged to have been lost shall be found
again.
If the drawer on request as aforesaid refuses to give such duplicate bill,
he may be compelled to do so.]
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OF NEGOTIATION
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Delivery
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46. The making, acceptance or
indorsement of a promissory note, bill of exchange or cheque is completed
by delivery, actual or constructive.
As between parties standing in immediate relation, delivery to be effectual
must be made by the party making, accepting or indorsing the instrument or
by a person authorised by him in that behalf.
As between such parties and any holder of the instrument other than a
holder in due course, it may be shown that the instrument was delivered
conditionally or for a special purpose only, and not for the purpose of
transferring absolutely the property therein.
A promissory note, bill of exchange or cheque payable to bearer is
negotiable by the delivery thereof.
A promissory note, bill of exchange or cheque payable to order is negotiable
by the holder by indorsement and delivery thereof.
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Negotiation by delivery
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47. Subject to the provisions of
section 58, a promissory note, bill of exchange or cheque payable to bearer
is negotiable by delivery thereof.
Exception - A promissory note, bill of exchange or cheque delivered on
condition that it is not to take effect except in a certain event is not
negotiable (except in the hands of a holder for value without notice of the
condition) unless such event happens.
Illustrations
(a) A, the holder of a negotiable instrument payable to bearer, delivers it
to B's agent to keep for B. The instrument has been negotiated.
(b) A, the holder of a negotiable instrument payable to bearer, which is in
the hands of A's banker, who is at the time the banker of B, directs the
banker to transfer the instrument to B's credit in the banker's account
with B. The banker does so, and accordingly now possesses the instrument as
B's agent. The instrument has been negotiated, and B has become the holder
of it.
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Negotiation by indorsement
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48. Subject to the provisions of
section 58, a promissory note, bill if exchange or cheque payable to order
is negotiable by the holder by indorsement and delivery thereof.
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Conversion of indorsement in blank
into indorsement in full
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49. When a negotiable instrument
has been indorsed in blank, any holder may, without signing his own name,
convert the blank indorsement into an indorsement in full by writing above
the indorser's signature a direction to pay the amount to or to the order
of himself or some other person; and the holder does not thereby incur the
responsibility of an indorser.
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Effect of indorsement
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50.(1) Subject to the provisions of
this Act relating to restrictive, conditional and qualified indorsement,
the indorsement of a negotiable instrument followed by delivery transfers
to the indorsee the property therein with the right of further negotiation.
(2) An indorsement is restrictive which either-
(a) restricts or excludes the right to further negotiate the instrument; or
(b) constitutes the indorsee an agent of the indorser to indorse the
instrument or to receive its contents for the indorser or for some other
specified person:
Provided that the mere absence of words implying right to negotiate does
not make the indorsement restrictive.
Illustrations
B signs the following indorsements on different negotiable instruments
payable to bearer:-
(a) "Pay the contents to C only."
(b) "Pay C for my use."
(c) “Pay C or order for the account of B.”
(d) “The within must be credited to C.”
These indorsements exclude the right of further negotiation by C.
(e) “Pay C.”
(f) “Pay C value in account with the Oriental Bank.”
(g) “Pay the contents to C, being part of the consideration in a certain
deed of assignment executed by C to the indorser and others.”
These indorsements do not exclude the right of further negotiation by C.
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Who may negotiate
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51. Every sole maker, drawer, payee
or indorsee, or all of several joint makers, drawers, payees or indorsees,
of a negotiable instrument may, if the negotiability of such instrument has
not been restricted or excluded as mentioned in section 50, indorse and
negotiate the same.
Explanation - Nothing in this section enables a maker or drawer to
indorse or negotiate an instrument, unless he is in lawful possession or is
holder thereof; or enables a payee or indorsee to indorse or negotiate an
instrument, unless he is holder thereof.
Illustration
A bill is drawn payable to A or order. A indorses it to B, the indorsement
not containing the words “or order” or any equivalent words. B may
negotiate the instrument.
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Indorser who excludes his own
liability or makes it conditional
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52. The indorser of a negotiable
instrument may, by express words in the indorsement, exclude his own
liability thereon, or make such liability or the right of the indorsee to receive
the amount due thereon depend upon the happening of a specified event,
although such event may never happen.
Where an indorser so excludes his liability and afterwards becomes the
holder of the instrument, all intermediate indorsers are liable to him.
Where the right of an indorsee to receive the amount due on the negotiable
instrument is made dependent in the aforesaid manner the condition is valid
only as between the indorser and the indorsee.
Where the indorsement of a negotiable instrument purports to be
conditional, the payer may disregard the condition, and payment to the
indorsee is valid whether the condition has been fulfilled or not.
Illustrations
(a) The indorser of a negotiable instrument signs his name adding the
words-“Without recourse”.
Upon this indorsement he incurs no liability.
(b) A is the payee and holder of a negotiable instrument. Excluding
personal liability by an indorsement “without recourse,” he transfers the
instrument to B, and B indorses it to C, who indorses it to A. A is not
only reinstated in his former rights, but has the rights of an indorsee
against B and C.
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Holder claiming through holder in
due course
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53. (1) A holder who derives his
title through a holder in due course, and who is not himself a party to any
fraud or illegality affecting the negotiable instrument, has all the rights
therein of that holder in due course as regards the acceptor and all
parties to the instrument prior to that holder.
(2) Where the title of the holder is defective,-
(a) if he negotiates the instrument to a holder in due course, that holder
obtains a good and complete title to the instrument; and
(b) if he obtains payment of the instrument, the person who pays him in due
course gets a valid discharge for the instrument.
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Rights of holder in due course
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9[ 53A. A holder in due
course holds the negotiable instrument free from any defect of title of
prior parties, and free from defences available to prior parties among
themselves, and may enforce payment of the instrument for the full amount
thereof against all parties liable thereon.]
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Instrument indorsed in blank
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54. Subject to the provisions
hereinafter contained as to crossed cheques, a negotiable instrument
indorsed in blank is payable to the bearer thereof even although originally
payable to order.
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Conversion of indorsement in blank
into indorsement in full
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55. If a negotiable instrument,
after having been indorsed in blank, is indorsed in full, the amount of it
cannot be claimed from the indorser in full, except by the person to whom
it has been indorsed in full, or by one who derives title through such
person.
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Requisites of indorsement
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56.(1) Negotiation by indorsement
must be of the entire instrument.
(2) An indorsement which purports to transfer to the indorsee only a part
of the amount payable, or which purports to transfer the instrument to two
or more indorsees severally, is not valid as a negotiation of the
instrument; but where such amount has been paid in part, a note to that
effect may be indorsed on the instrument, which may then be indorsed for
the balance.
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Legal representative cannot by
delivery only negotiate instrument indorsed by deceased
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57. The legal representative of a
deceased person cannot negotiate by delivery only a promissory note, bill
of exchange or cheque payable to order and indorsed by the deceased but not
delivered.
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Negotiation of instrument of party
already liable thereon
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10[ 57A. Where a negotiable
instrument is negotiated back before maturity to the maker or drawer or a
prior indorser or to the acceptor, such party may, subject to the
provisions of this Act, re-issue and further negotiate the instrument, but
he is not entitled to enforce payment of the instrument against any
intervening party to whom he was previously liable.
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Rights of holder
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57B. A holder may receive payment
in due course under a negotiable instrument and further negotiate it in the
manner provided by this Act; he may also sue on such instrument in his own
name.]
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Defective title
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58. When a promissory note, bill of
exchange or cheque has been lost or has been obtained from any maker,
drawer, acceptor or holder thereof by means of an offence or fraud, or for
an unlawful consideration, neither the person who finds or so obtains the
instrument nor any possessor or indorsee who claims through such person is
entitled to receive the amount due thereon from such maker, drawer, acceptor
or holder, unless such possessor or indorsee is, or some person through
whom he claims was, a holder thereof in due course.
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Instrument acquired after dishonour
or when overdue
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59. The holder of a negotiable
instrument, who has acquired it after dishonour, whether by non-acceptance
or non-payment, with notice thereof, or after maturity, has only, as
against the other parties, the rights thereon of his transferor and is
subject to the equities to which the transferor was subject at the time of
acquisition by such holder:
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Accommodation note or bill
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Provided that any person who, in
good faith and for consideration, becomes the holder, after maturity, of a
promissory note or bill of exchange made, drawn or accepted without
consideration, for the purpose of enabling some party thereto to raise
money thereon, may recover the amount of the note or bill from any prior
party.
Illustration
The acceptor of a bill of exchange, when he accepted it, deposited with the
drawer certain goods as a collateral security for the payment of the bill,
with power to the drawer to sell the goods and apply the proceeds in
discharge of the bill if it were not paid at maturity. The bill not having
been paid at maturity, the drawer sold the goods and retained the proceeds,
but indorsed the bill to A. A's title is subject to the same objection as
the drawer's title.
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Instrument negotiable till payment
or satisfaction
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60. A negotiable instrument may be
negotiated (except by the maker, drawee or acceptor after maturity) until
payment or satisfaction thereof by the maker, drawee or accept or at or
after maturity, but not after such payment or satisfaction.
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CHAPTER V
OF PRESENTMENT
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Presentment for acceptance
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61. A bill of exchange payable
after sight must, if no time or place is specified therein for presentment,
be presented to the drawee thereof for acceptance, if he can, after
reasonable search, be found, by a person entitled to demand acceptance,
within a reasonable time after it is drawn, and in business hours on a
business day. In default of such presentment, no party thereto is liable
thereon to the person making such default.
If the drawee cannot, after reasonable search, be found, the bill is
dishonoured.
If the bill is directed to the drawee at a particular place, it must be
presented at that place; and if at the due date for presentment he cannot,
after reasonable search, be found there, the bill is dishonoured.
Where authorised by agreement or usage, a presentment through the post
office by means of a registered letter is sufficient.
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Presentment of promissory note for
sight
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62. A promissory note, payable at a
certain period after sight, must be presented to the maker thereof for
sight (if he can, after reasonable search, be found) by a person entitled
to demand payment, within a reasonable time after it is made and in
business hours on a business day. In default of such presentment, no party
thereto is liable thereon to the person making such default.
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Drawee’s time for deliberation
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63. The holder must, if so required
by the drawee of a bill of exchange presented to him for acceptance, allow
the drawee forty-eight hours (exclusive of public holidays) to consider
whether he will accept it.
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Presentment for payment
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64. Subject to the provisions of
section 76, promissory notes, bills of exchange and cheques must be
presented for payment to the maker, acceptor or drawee thereof
respectively, by or on behalf of the holder as hereinafter provided. In
default of such presentment, the other parties thereto are not liable
thereon to such holder.
Exception - Where a promissory note is payable on demand and is not payable
at a specified place, no presentment is necessary in order to charge the
maker thereof nor is presentment necessary to charge the acceptor of a bill
of exchange.
The provisions of this section are without prejudice to the provisions
relating to presentment or acceptance in the case of a bill of exchange.
Explanation - Where there are several persons, not being partners
liable on the negotiable instrument, as makers, acceptors or drawees, as
the case may be, and no place of payment is specified, presentment must be
made to them all.
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Hours for presentment
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65. Presentment for payment must be
made during the usual hours of business, and, if at a banker's within
banking hours.
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Presentment for payment of
instrument payable after date or sight
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66. A promissory note or bill of
exchange, made payable at a specified period after date or sight thereof,
must be presented for payment at maturity.
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Presentment for payment of
promissory note payable by instalments
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67. A Promissory note payable by
instalments must be presented for payment on the third day after the date
fixed for payment of each instalment; and non-payment on such presentment
has the same effect as non-payment of a note at maturity.
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Presentment for payment of
instrument payable at specified place and not elsewhere
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68. A promissory note, bill of
exchange or cheque made, drawn or accepted payable at a specified place and
not elsewhere must, in order to charge any party thereto, be presented for
payment at that place.
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Instrument payable at specified
place
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69. A promissory note or bill of
exchange made, drawn or accepted payable at a specified place must, in
order to charge the maker or drawer thereof, be presented for payment at
that place.
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Presentment where no exclusive
place specified
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70. A promissory note or bill of
exchange, not made payable as mentioned in sections 68 and 69, must be
presented for payment at the address of the maker, acceptor or drawee given
in the instrument, and if no such address is given at the place of business
if known, or at the ordinary residence (if known), of the maker, drawee or
acceptor thereof, as the case may be.
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Presentment when maker, etc, has no
known place of business or residence
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71. If the maker, drawee or
acceptor of a negotiable instrument has no known place of business or
residence, and no place is specified in the instrument for presentment for
acceptance or payment, such presentment may be made to him in person
wherever he can be found.
Explanation - In this section and sections 68 and 69, “specified
place” means a place sufficiently described so as to enable the person
presenting the instrument to locate it.
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What constitutes valid presentment
and mode of presentment
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11[ 71A.(1) To
constitute a valid presentment it shall be sufficient if instead of the
original negotiable instrument a copy thereof certified to be true by the
holder is delivered to the person liable thereon, either personally or by
registered post or by other effective means.
(2) If, after such delivery, the person liable to pay so demands, the
holder shall allow him to inspect the original negotiable instrument during
the hours of business of the holder, and if the holder fails to do so
within a reasonable time, the presentment shall be deemed to be invalid.]
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Presentment of cheque to charge
drawer
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72. Subject to the provisions of
section 84, a cheque must, in order to charge the drawer, be presented at
the bank upon which it is drawn before the relation between the drawer and
his banker has been altered to the prejudice of the drawer.
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Presentment of cheque to charge any
other person
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73. A cheque must, in order to
charge any person except the drawer, be presented within a reasonable time
after delivery thereof by such person.
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Presentment of instrument payable
on demand
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74. Subject to the provisions of
section 31, a negotiable instrument payable on demand must be presented for
payment within a reasonable time after it is received by the holder.
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Presentment by or to agent,
representative of deceased, or assignee of insolvent
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75. Presentment for acceptance or
payment may be made to the duly authorised agent of the drawee, maker or
acceptor, as the case may be, or, where the drawee, maker or acceptor has
died, to his legal representative, or, where he has been declared an
insolvent, to his assignee.
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Excuse for delay in presentment for
acceptance or payment
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12[ 75A. Delay in
presentment for acceptance or payment is excused if the delay is caused by
circumstances beyond the control of the holder, and not imputable to his
default, misconduct or negligence. When the cause of delay ceases to
operate, presentment must be made within a reasonable time.]
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When presentment unnecessary
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76. No presentment for payment is
necessary, and the instrument shall be deemed to be dishonoured at the due
date for presentment, in any of the following cases:-
(a) if the maker, drawee or acceptor intentionally prevents the presentment
of the instrument, or,
if the instrument being payable at his place of business, he closes such
place on a business day during the usual business hours, or,
if the instrument being payable at some other specified place, neither he
nor any person authorised to pay it attends at such place during the usual
business hours, or
if the instrument not being payable at any specified place, he cannot after
due search be found;
(b) as against any party sought to be charged therewith, if he has engaged
to pay notwithstanding non-presentment;
(c) as against any party if, after maturity, with knowledge that the
instrument has not been presented-
he makes a part payment on account of the amount due on the instrument, or
promises to pay the amount due thereon in whole or in part,
or otherwise waives his right to take advantage of any default in
presentment for payment;
(d) as against the drawer, if the drawer could not suffer damage from the
want of such presentment;
(e) where the drawee is a fictitious person;
(f) as regards an indorser, where the negotiable instrument was made, drawn
or accepted for the accommodation of that indorser and he had reason to
expect that the instrument would not be paid if presented; and
(g) where, after the exercise of reasonable diligence, presentment as
required by this Act cannot be effected.
Explanation - The fact that holder has reason to believe that the
negotiable instrument will, on presentment, be dishonoured does not
dispense with the necessity for presentment.
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Liability of banker for negligently
dealing with bill presented for payment
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77. When a bill of exchange
accepted payable at a specified bank has been duly presented there for
payment and dishonoured, if the banker so negligently or improperly keeps,
deals with or delivers back such bill as to cause loss to the holder, he
must compensate the holder for such loss.
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CHAPTER VI
OF PAYMENT AND INTEREST
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To whom payment should be made
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78. Subject to the provisions of
section 82, clause (c), payment of the amount due on a promissory note,
bill of exchange or cheque must, in order to discharge the maker or
acceptor, be made to the holder of the instrument.
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Interest when rate specified or not
specified
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79. Subject to the provisions of
any law for the time being in force relating to the relief of debtors, and
without prejudice to the provisions of section 34 of the Code of Civil Procedure, 1908,
(a) when interest at a specified rate is expressly made payable on a
promissory note or bill of exchange and no date is fixed from which
interest is to be paid, interest shall be calculated at the rate specified,
on the amount of the principal money due thereon, from the date of the
note, or, in the case of a bill, from the date on which the amount becomes
payable, until tender or realisation of such amount, or until the date of
the institution of a suit to recover such amount;
(b) when a promissory note or bill of exchange is silent as regards
interest or does not specify the rate of interest, interest on the amount
of the principal money due thereon shall, notwithstanding any collateral
agreement relating to interest between any parties to the instrument, be
allowed and calculated at the rate of six per centum per annum from the
date of the note, or, in the case of a bill, from the date on which the
amount becomes payable, until tender or realisation of the amount due
thereon, or until the date of the institution of a suit to recover such
amount.
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Interest when no rate specified
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80. When no rate of interest is
specified in the instrument, interest on the amount due thereon shall,
not-withstanding any agreement relating to interest between any parties to
the instrument, be calculated at the rate of six per centum per annum from
the date at which the same ought to have been paid by the party charged
until tender or realisation of the amount due thereon, or until such date
after the institution of a suit to recover such amount as the Court
directs.
Explanation - When the party charged is the indorser of an
instrument dishonoured by non-payment, he is liable to pay interest only
from the time that he receives notice of the dishonour.
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Delivery of instrument on payment,
or indemnity in case of loss
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81. Any person liable to pay, and
called upon by the holder thereof to pay, the amount due on a promissory
note, bill of exchange or cheque is before payment entitled to have it
shown, and is on payment entitled to have it delivered up, to him, or, if
the instrument is lost or cannot be produced, to be indemnified against any
further claim thereon against him.
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CHAPTER VII
OF DISCHARGE FROM LIABILITY ON NOTES, BILLS AND CHEQUES
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Discharge from liability-
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82. The maker, acceptor or indorser
respectively of a negotiable instrument is discharged from liability
thereon-
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(a) by cancellation
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(a) to a holder thereof who cancels
such acceptor's or indorser's name with intent to discharge him, and to all
parties claiming under such holder;
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(b) by release
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(b) to a holder thereof who
otherwise discharges such maker, acceptor or indorser, and to all parties
deriving title under such holder after notice of such discharge;
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(c) by payment
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(c) to all parties thereto, if the
instrument is payable to bearer, or has been indorsed in blank, and such
maker, acceptor or indorser makes payment in due course of the amount due
thereon.
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Discharge by allowing drawee more
than forty-eight hours to accept
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83. If the holder of a bill of
exchange allows the drawee more than forty-eight hours, exclusive of public
holidays, to consider whether he will accept the same, all previous parties
not consenting to such allowance are thereby discharged from liability to
such holder.
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When cheque not duly presented and
drawer damaged thereby
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84.(1) Where a cheque is not
presented for payment within a reasonable time of its issue, and the drawer
or person on whose account it is drawn had the right, at the time when
presentment ought to have been made, as between himself and the banker, to
have the cheque paid and suffers actual damage through the delay, he is
discharged to the extent of such damage, that is to say, to the extent to
which such drawer or person is a creditor of the banker to a larger amount
than he would have been if such cheque had been paid.
(2) In determining what is a reasonable time, regard shall be had to the
nature of the instrument, the usage of trade and of bankers, and the facts
of the particular case.
(3) The holder of the cheque as to which such drawer or person is so
discharged shall be a creditor, in lieu of such drawer or person, of such
banker to the extent of such discharge and entitled to recover the amount
from him.
Illustrations
(a) A draws a cheque for Taka 1,000, and when the cheque ought to be
presented, has funds at the bank to meet it. The bank fails before the
cheque is presented. The drawer is discharged, but the holder can prove
against the bank for the amount of the cheque.
(b) A draws a cheque at 13[ Dinajpur] on a bank
in Chittagong. The bank fails before the cheque could be presented in
ordinary course. A is on discharged, for he has not suffered actual damage
through any delay in presenting the cheque.
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Cheque payable to order
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85.(1) Where a cheque payable to
order purports to be indorsed by or on behalf of the payee, the drawee is
discharged by payment in due course.
(2) Where a cheque is originally expressed to be payable to bearer, the
drawee is discharged by payment in due course to the bearer thereof,
notwithstanding any indorsement whether in full or in blank appearing
thereon, and notwithstanding that any such indorsement purports to restrict
or exclude further negotiation.
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Drafts drawn by one branch of a
bank on another payable to order
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14[ 85A. Where any
draft, that is, an order to pay money, drawn by one office of a bank upon
another office of the same bank for a sum of money payable to order on
demand, purports to be indorsed by or on behalf of the payee, the bank is
discharged by payment in due course.]
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Parties not consenting discharged
by qualified or limited acceptance
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86. If the holder of a bill of
exchange acquiesces in a qualified acceptance, or one limited to part of
the sum mentioned in the bill, or which substitutes a different place or
time for payment, or which, where the drawees are not partners, is not
signed by all the drawees, all previous parties whose consent is not
obtained to such acceptance are discharged as against the holder and those
claiming under him, unless on notice given by the holder they assent to
such acceptance.
Explanation -An acceptance is qualified -
(a) where it is conditional, declaring the payment to be dependent on the
happening of an event therein stated;
(b) where it undertakes the payment of part only of the sum ordered to be
paid;
(c) where, no place of payment being specified on the order it undertakes
the payment at a specified place, and not otherwise or elsewhere; or where,
a place of payment being specified in the order, it undertakes the payment
at some other place and not otherwise or elsewhere;
(d) where it undertakes the payment at a time other than that at which
under the order it would be legally due.
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Effect of material alteration
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87. Any material alteration of a
negotiable instrument renders the same void as against any one who is a
party thereto at the time of making such alteration and does not consent
thereto, unless it was made in order to carry out the common intention of
the original parties;
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Alteration by indorsee
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and any such alteration, if made by
an indorsee, discharges his indorser from all liability to him in respect
of the consideration thereof.
The provisions of this section are subject to those of sections 20, 49, 86
and 125.
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Acceptor or indorser bound
notwithstanding previous alteration
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88. An acceptor or indorser of a
negotiable instrument is bound by his acceptance or indorsement
notwithstanding any previous alteration of the instrument.
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Payment of instrument on which
alteration is not apparent
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89. Where a promissory note, bill
of exchange or cheque has been materially altered but does not appear to
have been so altered,
or where a cheque is presented for payment which does not at the time of
presentation appear to be crossed or to have had a crossing which has been
obliterated,
payment thereof by a person or banker liable to pay, and paying the same
according to the apparent tenor thereof at the time of payment and
otherwise in due course, shall discharge such person or banker from all
liability thereon; and such payment shall not be questioned by reasoned of
the instrument having been altered or the cheque crossed.
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Extinguishment of rights of action
on bill in acceptor’s hands
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90.(1) The maker, drawer, acceptor
or indorser of a negotiable instrument is discharged from liability thereon
when the person liable thereon as principal debtor becomes the holder
thereof at or after its maturity.
(2) When the holder of an accepted bill of exchange enters into any
contract with the acceptor of the nature referred to in section 39, the
other parties are discharged, unless the holder has expressly reserved his
right to charge them.
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CHAPTER VIII
OF NOTICE OF DISHONOUR
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Dishonour by non-acceptance
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91. A bill of exchange is said to
be dishonoured by non-acceptance when the drawee, or one of several drawees
not being partners, makes default in acceptance upon being duly required to
accept the bill, or where presentment is excused and the bill is not
accepted.
Where the drawee is incompetent to contract, or the acceptance is qualified,
the bill may be treated as dishonoured.
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Dishonour by non-payment
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92. A promissory note, bill of
exchange or cheque is said to be dishonoured by non-payment when the maker
of the note, acceptor of the bill or drawee of the cheque makes default in
payment upon being duly required to pay the same.
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By and to whom notice should be
given
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93. When a promissory note, bill of
exchange or cheque is dishonoured by non-acceptance or non-payment, the
holder thereof, or some party thereto who remains liable thereon, must give
notice that the instrument has been so dishonoured to all other parties
whom the holder seeks to make severally liable thereon, and to some one of
several parties whom he seeks to make jointly liable thereon.
When a bill of exchange is dishonoured by non-acceptance the drawer or any
indorser to whom such notice is not given is discharged; but the rights of
a holder in due course subsequent to the omission to give notice shall not
be prejudiced by that omission.
When a bill of exchange is dishonoured by non-acceptance and due notice of
dishonour is given, it shall not be necessary to give notice of a
subsequent dishonour by non-payment, unless the bill shall, in the
meantime, have been accepted.
Nothing in this section renders it necessary to give notice to the maker of
the dishonoured promissory note or the drawee or acceptor of the
dishonoured bill of exchange or cheque.
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Mode in which notice may be given
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94. Notice of dishonour may be
given to a duly authorised agent of the person to whom it is required to be
given, or, where he has died, to his legal representative, or, where he has
been declared an insolvent, to his assignee; may be oral or written; may,
if written, be sent by post; and may be in any form; but it must inform the
party to whom it is given, either in express terms or by reasonable
intendment, that the instrument has been dishonoured, and in what way, and
that he will be held liable thereon; and it must be given within a
reasonable time after dishonour, at the place of business or (in case such
party has no place of business) at the residence of the party for whom it
is intended.
If the notice is duly directed and sent by post and miscarries, such miscarriage
does not render the notice invalid.
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Party receiving must transmit
notice of dishonour
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95. Any party receiving notice of
dishonour must, in order to render any prior party liable to himself, give
notice of dishonour to such party within a reasonable time, unless such
party otherwise receives due notice as provided by section 93.
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Agent for presentment
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96. When the instrument is
deposited with an agent for presentment, the agent entitled to the same
time to give notice to his principal as if he were the holder giving notice
of dishonour, and the principal is entitled to a further like period to
give notice of dishonour.
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When party to whom notice given is
dead
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97. When the party to whom notice
of dishonour is despatched is dead, but the party despatching the notice is
ignorant of his death, the notice is sufficient.
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When notice of dishonour is
unnecessary
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98. No notice of dishonour is
necessary-
(a) when it is dispensed with by the party entitled thereto;
(b) in order to charge the drawer when he has countermanded payment;
(c) when the party charged could not suffer damage for want of notice;
(d) when the party entitled to notice cannot after due search be found; or
the party bound to give notice is, for any other reason, unable without any
fault of his own to give it;
(e) to charge the drawers when the acceptor is also a drawer;
(f) in the case of a promissory note which is not negotiable;
(g) when the party entitled to notice, knowing the facts, promises
unconditionally to pay the amount due on the instrument.
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CHAPTER IX
OF NOTING AND PROTEST
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Noting
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99. When a promissory note or bill
of exchange has been dishonoured by non-acceptance or non-payment, the
holder may cause such dishonour to be noted by a notary public upon the
instrument, or upon a paper attached thereto, or partly upon each.
Such note must be made within a reasonable time after dishonour, and must
specify the date of dishonour, the reason, if any, assigned for such
dishonour, or, if the instrument has not been expressly dishonoured, the
reason why the holder treats it as dishonoured, and the notary's charges.
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Protest
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100. When a promissory note or bill
of exchange has been dishonoured by non-acceptance or non-payment, the
holder may, within a reasonable time, cause such dishonour to be noted and
certified by a notary public. Such certificate is called a protest.
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Protest for better security
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When the acceptor of a bill of
exchange has become insolvent, or his credit has been publicly impeached,
before the maturity of the bill, the holder may, within a reasonable time,
cause a notary public to demand better security of the acceptor, and on its
being refused may, within a reasonable time, cause such facts to be noted
and certified as aforesaid. Such certificate is called a protest for better
security.
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Contents of protest
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101. A protest under section 100
must contain-
(a) either the instrument itself, or a literal transcript of the instrument
and of everything written or printed thereupon;
(b) the name of the person for whom and against whom the instrument has
been protested;
(c) a statement that payment or acceptance, or better security, as the case
may be, has been demanded of such person by the notary public; the terms of
his answer, if any, or a statement that he gave no answer or that he could
not be found;
(d) when the note or bill has been dishonoured, the place and time of
dishonour, and, when better security has been refused, the place and time
of refusal;
(e) the subscription of the notary public making the protest;
(f) in the event of an acceptance for honour or of a payment for honour,
the name of the person by whom, of the person for whom, and the manner in
which, such acceptance or payment was offered and effected.
A notary public may make the demand mentioned in clause (c) of this section
either in person or by his clerk or, where authorised by agreement or
usage, by registered letter.
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Notice of protest
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102. When a promissory note or bill
of exchange is required by law to be protested, notice of such protest must
be given instead of notice of dishonour, in the same manner and subject to
the same conditions; but the notice may be given by the notary public who
makes the protest.
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Protest for non-payment after
dishonour by non-acceptance
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103. All bills of exchange drawn
payable at some other place than the place mentioned as the residence of
the drawee, and which are dishonoured by non-acceptance, may, without
further presentment to the drawee, be protested for non-payment in the
place specified for payment, unless paid before or at maturity.
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Protest of foreign bills
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104. Foreign bills of exchange must
be protested for dishonour when such protest is required by the law of the
place where they are drawn.
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When noting equivalent to protest
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15[ 104A. For the
purposes of this Act, where a bill or note is required to be protested
within a specified time or before some further proceeding is taken, it is
sufficient that the bill has been noted for protest before the expiration
of the specified time or the taking of the proceeding; and the formal
protest may be extended at any time thereafter as of the date of the
noting.]
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CHAPTER X
OF REASONABLE TIME
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Reasonable time
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105. In determining what is a
reasonable time for presentment for acceptance or payment, for giving
notice of dishonour and for noting, regard shall be had to the nature of
the instrument and the usual course of dealing with respect to similar
instruments, and, in calculating such time, public holidays shall be
excluded.
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Reasonable time of giving notice of
dishonour
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106. If the holder and the party to
whom notice of dishonour is given carry on business or live (as the case
may be) in different places, such notice is given within a reasonable time
if it is despatched by the next post or on the day next after the day of
dishonour.
If the said parties carry on business or live in the same place, such
notice is given within a reasonable time if it is despatched in time to
reach its destination on the day next after the day of dishonour.
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Reasonable time for transmitting
such notice
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107. A party receiving notice of
dishonour, who seeks to enforce his right against a prior party, transmits
the notice within a reasonable time if he transmits it within the same time
after its receipt as he would have had to give notice if he had been the
holder.
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CHAPTER XI
OF ACCEPTANCE AND PAYMENT FOR HONOUR AND REFERENCE IN CASE OF NEED
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Acceptance for honour
|
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108. When a bill of exchange has
been noted or protested for non-acceptance or for better security, any
person not being a party already liable thereon may, with the consent of
the holder, by writing on the bill, accept the same for the honour of any
party thereto.
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How acceptance for honour must be
made
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109. A person desiring to accept
for honour must, by writing on the bill under his hand, declare that he
accepts under protest the protested bill for the honour of the drawer or of
a particular indorser whom he names, or generally for honour.
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Acceptance not specifying for whose
honour it is made
|
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110. Where the acceptance does not
express for whose honour it is made, it shall be deemed to be made for the
honour of the drawer.
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Liability of acceptor for honour
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111. An acceptor for honour binds
himself to all parties subsequent to the party for whose honour he accepts
to pay the amount of the bill if the drawee do not: and such party and all
prior parties are liable in their respective capacities to compensate the
acceptor for honour for all loss or damage sustained by him in consequence
of such acceptance.
But an acceptor for honour is not liable to the holder of the bill unless
it is presented, or (in case the address given by such acceptor on the bill
is a place other than the place where the bill is made payable) forwarded
for presentment, not later than the day next after the day of its maturity.
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When acceptor for honour may be
charged
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112. An acceptor for honour cannot
be charged unless the bill has at its maturity been presented to the drawee
for payment, and has been dishonoured by him, and noted or protested for
such dishonour.
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Payment for honour
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113. When a bill of exchange has
been noted or protested for non-payment, any person may pay the same for
the honour of any party liable to pay the same, provided that the person so
paying or his agent in that behalf has previously declared before a notary
public the party for whose honour he pays, and that such declaration has
been recorded by such notary public.
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Right of payer for honour
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114. Any person so paying is
entitled to all the rights, in respect of the bill, of the holder at the
time of such payment, and may recover from the party for whose honour he
pays all sums so paid, with interest thereon and with all expenses properly
incurred in making such payment.
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Drawee in case of need
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115. Where a drawee in case of need
is named in a bill of exchange, or in any indorsement thereon, the bill is
not dishonoured until it has been dishonoured by such drawee.
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Acceptance and payment without
protest
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116. A drawee in case of need may
accept and pay the bill of exchange without previous protest.
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CHAPTER XII
OF COMPENSATION
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Rules as to compensation
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117. The compensation payable in
case of dishonour of a promissory note, bill of exchange or cheque, by any
party liable to the holder or any indorsee, shall be determined by the
following rules:-
(a) the holder is entitled to the amount due upon the instrument, together
with the expenses properly incurred in presenting, noting and protesting
it;
(b) when the person charged resides at a place different from that at which
the instrument was payable, the holder is entitled to receive such sum at
the current rate of exchange between the two places;
(c) an indorser who, being liable, has paid the amount due on the same is
entitled to the amount so paid with interest at six per centum per annum
from the date of payment until tender or realisation thereof, together with
all expenses caused by the dishonour and payment;
(d) when the person charged and such indorser reside at different places,
the indorser is entitled to receive such sum at the current rate of
exchange between the two places;
(e) the party entitled to compensation may draw a bill upon the party
liable to compensate him, payable at sight or on demand, for the amount due
to him, together with all expenses properly incurred by him. Such bill must
be accompanied by the instrument dishonoured and the protest thereof (if
any). If such bill is dishonoured, the party dishonouring the same is
liable to make compensation thereof in the same manner as in the case of
the original bill.
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CHAPTER XIII
SPECIAL RULES OF EVIDENCE
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Presumptions as to negotiable
instruments- (a) of consideration; (b) as to date; (c) as to time of
acceptance; (d) as to time of transfer; (e) as to order of indorsements;
(f) as to stamp; (g) that holder is a h
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118. Until the contrary is proved,
the following presumptions shall be made:
(a) that every negotiable instrument was made or drawn for consideration,
and that every such instrument, when it has been accepted, indorsed,
negotiated or transferred, was accepted, indorsed, negotiated or
transferred for consideration;
(b) that every negotiable instrument bearing a date was made or drawn on
such date;
(c) that every accepted bill of exchange was accepted within a reasonable
time after its date and before its maturity;
(d) that every transfer of a negotiable instrument was made before its
maturity;
(e) that the indorsements appearing upon a negotiable instrument were made
in the order in which they appear thereon;
(f) that a lost promissory note, bill of exchange or cheque was duly
stamped;
(g) that the holder of a negotiable instrument is a holder in due course:
provided that, where the instrument has been obtained from its lawful
owner, or from any person in lawful custody thereof, by means of an offence
or fraud, or has been obtained from the maker or acceptor thereof by means
of an offence or fraud, or for unlawful consideration, the burden of
proving that the holder is a holder in due course lies upon him.
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Presumption on proof of protest
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119. In a suit upon an instrument
which has been dishonoured, the Court shall, on proof of the protest,
presume the fact of dishonour, unless and until such fact is disproved.
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Estoppel against denying original
validity of instrument
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120. No maker of a promissory note,
and no drawer of a bill of exchange or cheque, and no acceptor of a bill of
exchange for the honour of the drawer, shall, in a suit thereon by a holder
in due course, be permitted to deny the validity of the instrument as originally
made or drawn.
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Estoppel against denying capacity
of payee to indorse
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121. No maker of a promissory note
and no acceptor of a bill of exchange payable to order shall, in a suit
thereon by a holder in due course, be permitted to deny the payee's
capacity, at the date of the note or bill, to indorse the same.
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Estoppel against denying signature
or capacity of prior party
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122. No indorser of a negotiable
instrument shall, in a suit thereon by a subsequent holder, be permitted to
deny the signature or capacity to contract of any prior party to the
instrument.
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CHAPTER XIV
SPECIAL PROVISIONS RELATING TO CHEQUES
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Revocation of Banker’s authority
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16[ 122A. The duty and
authority of a banker to pay a cheque drawn on him by his customer are
determined by-
(1) countermand of payment;
(2) notice of the customer's death;
(3) notice of adjudication of the customer as an insolvent.]
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Cheque crossed generally
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123. Where a cheque bears across
its face an addition of the words “and company” or any abbreviation
thereof, between two parallel transverse lines, or of two paralled transverse
lines simply, either with or without the words “not negotiable”, that
addition shall be deemed a crossing and the cheque shall be deemed to be
crossed generally.
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Cheque crossed “account- payee”
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17[ 123A. (1) Where a
cheque crossed generally bears across its face an addition of the words
“account payee” between the two parallel transverse lines constituting the
general crossing, the cheque, besides being crossed generally, is said to
be crossed “account payee”. Cheque crossed “account payee”
(2) When a cheque is crossed “account payee”-
(a) it shall cease to be negotiable; and
(b) it shall be the duty of the banker collecting payment of the cheque to
credit the proceeds thereof only to the account of the payee named in the
cheque.]
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Cheque crossed specially
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124. Where a cheque bears across
its face an addition of the name of a banker, either with or without the
words “not negotiable”, that addition shall be deemed a crossing, and the
cheque shall be deemed to be crossed specially, and to be crossed to that
banker.
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Crossing after issue
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Cheque crossed specially
125. Where a cheque is uncrossed, the holder may cross it generally or
specially. Crossing after issue
Where a cheque is crossed generally, the holder may cross it specially.
Where a cheque is crossed generally or specially, the holder may add the
words "not negotiable".
Where a cheque is crossed specially, the banker to whom it is crossed may
again cross it specially to another banker, his agent, for collection.
When an uncrossed cheque, or a cheque crossed generally, is sent to a
banker for collection, he may cross it specially to himself.
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125A Crossing a material part of a
cheque
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18[ 125A. A crossing
authorised by this Act is a material part of the cheque; it shall not be
lawful for any person to obliterate, or, except as authorised by this Act,
to add to or alter, the crossing.]
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Payment of cheque crossed generally
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126. Where a cheque is crossed
generally, the banker on whom it is drawn shall not pay it otherwise than
to a banker.
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Payment of cheque crossed specially
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Where a cheque is crossed
specially, the banker on whom it is drawn shall not pay it otherwise than
to the banker to whom it is crossed, or his agent for collection.
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Payment of cheque crossed specially
more than once
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127. Where a cheque is crossed
specially to more than one banker, except when crossed to an agent for the
purpose of collection, the banker on whom it is drawn shall refuse payment
thereof.
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Payment in due course of crossed
cheque
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128. Where the banker on whom a
crossed cheque is drawn in good faith and without negligence pays it, if
crossed generally, to a banker, and if crossed specially, to the banker to
whom it is crossed or his agent for collection, being a banker, the banker
paying the cheque, and (in case such cheque has come to the hands of the
payee) the drawer thereof, shall respectively be entitled to the same
rights, and be placed in the same position in all respects, as they would
respectively be entitled to and placed in if the amount of the cheque had
been paid to and received by the true owner thereof.
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Payment of crossed cheque out of
due course
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129. Any banker paying a cheque
crossed generally otherwise than to a banker, or a cheque crossed specially
otherwise than to the banker to whom the same is crossed, or his agent for
collection, being a banker, shall be liable to the true owner of the cheque
for any loss he may sustain owing to the cheque having been so paid:
Provided that where a cheque is presented for payment which does not at the
time of presentment appear to be crossed, or to have had a crossing which
has been obliterated, added to or altered otherwise than as authorised by
this Act, the banker paying the cheque in good faith and without negligence
shall not be responsible or incur any liability nor shall the payment be
questioned, by reason of the cheque having been crossed, or of the crossing
having been obliterated or having been added to or altered otherwise than
as authorised by this Act, and of payment having been made otherwise than
to a banker or to the banker to whom the cheque is or was crossed, or to
his agent for collection, being a banker, as the case may be.
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Cheque bearing “not negotiable”
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130. A person taking a cheque
crossed generally or specially, bearing in either case the words “not
negotiable,” shall not have, and shall not be capable of giving, a better
title to the cheque than that which the person from whom he took it had.
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Non-liability of banker receiving
payment of cheque
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Cheque bearing “not negotiable”
131. Subject to the provisions of this Act relating to cheques crossed
“account payee”, where a banker in good faith and without negligence
receives payment for a customer of a cheque crossed generally or specially
to himself, and the customer has no title or a defective title thereto, the
banker shall not incur any liability to the true owner of the cheque by
reason only of having received such payment. Non-liability of banker
receiving payment of cheque
Explanation - A banker receives payment of a crossed cheque for a
customer within the meaning of this section notwithstanding that he credits
his customer's account with the amount of the cheque before receiving
payment thereof.
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Application of Chapter to drafts
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19[ 131A. The provisions
of this Chapter shall apply to any draft, as defined in section 85A, as if
the draft were a cheque.]
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Protection to banker crediting
cheque crossed “account- payee”
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20[ 131B. Where a cheque
is delivered for collection to a banker which does not at the time of such
delivery appear to be crossed “account payee” or to have had a crossing
“account payee” which has been obliterated or altered, the banker, in good
faith and without negligence collecting payment of the cheque and crediting
the proceeds thereof to a customer, shall not incur any liability by reason
of the cheque having been crossed “account payee”, or of such crossing
having been obliterated or altered, and of the proceeds of the cheque
having been credited to a person who is not the payee thereof.
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Cheque not operating as assignment
of funds
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131C. A cheque, of itself, does not
operate as an assignment of any part of the funds to the credit of the
drawer with the banker.
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CHAPTER XV
SPECIAL PROVISIONS RELATING TO BILLS OF EXCHANGE
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Several drawees
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131D. A bill of exchange may be
addressed to two or more drawees, whether they are partners or not; but an
order addressed to two drawees in the alternative, or to two or more
drawees in succession, is not a bill of exchange.
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In whose favour a bill may be drawn
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131E. A bill if exchange may be
drawn payable to, or to the order of, the drawer; or it may be drawn
payable to, or to the order of, the drawee.
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When presentment for acceptance is
necessary
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131F. A bill of exchange, in order
to fix the acceptor with liability, must be presented for acceptance before
it is presented for payment.
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When presentment excused
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131G. Presentment for acceptance is
excused, and a bill of exchange may be treated as dishonoured by
non-acceptance-
(a) where the drawee is dead or is insolvent or is a fictitious person or a
person not having capacity to contract by bill of exchange;
(b) where, at the due date for presentment, the drawee cannot, after
reasonable search, be found at the place at which the bill is to be
presented;
(c) where, after the exercise of reasonable diligence such, presentment
cannot be effected;
(d) where, although the presentment has been irregular, acceptance has been
refused on some other ground.
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Holder’s right of recourse against
drawn and indorsers
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131H. Subject to the provisions of
this Act, when a bill of exchange is dishonoured by non-acceptance, an
immediate right of recourse against the drawer and indorsers accrues, to
the holder, and no presentment for payment is necessary.
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Holder may refuse qualified
acceptance
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131-I. The holder of a bill of
exchange may refuse to take a qualified acceptance, and if he does not
obtain an unqualified acceptance, may treat the bill as dishonoured by
non-acceptance.]
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Set of bills
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132. Bills of exchange may be drawn
in parts, each part being numbered and containing a provision that it shall
continue payable only so long as the others remain unpaid. All the parts
together make a set; but the whole set constitutes only one bill, and is
extinguished when one of the parts, if a separate bill, would be
extinguished.
Exception.-When a person accepts or indorses different parts of the bill in
favour of different persons, he and the subsequent indorsers of each part
are liable on such part as if it were a separate bill.
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Holder of first acquired part
entitled to all
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133. As between holders in due
course of different parts of the same set he who first acquired title to
his part is entitled to the other parts and the money represented by the
bill.
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CHAPTER XVI
OF INTERNATIONAL LAW
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Law governing liability of parties
to a foreign instrument
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134. In the absence of a contract
to the contrary and subject to the provisions of section 136, in the case
of a foreign promissory note, bill of exchange or cheque,-
(a) the law of the place where the instrument was made or drawn, or
accepted or negotiated shall determine-
(i) the capacity of the parties; and
(ii) the validity of the instrument or, as the case may be, of its
acceptance or negotiation:
Provided that such instrument shall not be invalid or inadmissible in
evidence by reason only that it was not stamped or not sufficiently stamped
according to the law of the place where it was made or drawn;
(b) the law of the place where such instrument is payable shall determine,-
(i) the liability of all parties thereto;
(ii) the duties of the holder with respect to presentment for acceptance or
payment;
(iii) the date of maturity of the instrument;
(iv) what constitutes dishonour;
(v) the necessity for and sufficiency of a protest or notice of dishonour;
(vi) all questions relating to payment and satisfaction including the
currency in which and the rate of exchange at which the instrument is to be
paid.
Illustration
A bill of exchange was drawn by A in California, where the rate of interest
is 25 per cent., and accepted by B, payable in Washington, where the rate
of interest is 6 per cent. The bill is indorsed in Bangladesh, and is
dishonoured. An action on the bill is brought against B in Bangladesh. He
is liable to pay Interest at the rate of 6 per cent. only; but, if A is
charged as drawer, A is liable to pay interest at the rate of 25 per cent.
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[Omitted]
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135. [Omitted by section 53 of the
Negotiable Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of
1962).]
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Instrument made, etc, outside
Bangladesh, but in accordance with their law
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136. If a negotiable instrument is
made, drawn, accepted or indorsed outside Bangladesh, but in accordance
with the law of Bangladesh, the circumstance that any agreement evidenced
by such instrument is invalid according to the law of the country wherein
it was entered into does not invalidate any subsequent acceptance or
indorsement made thereon within Bangladesh.
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Presumption as to foreign law
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137. The law of any foreign country
regarding promissory notes, bills of exchange and cheques shall be presumed
to be the same as that of Bangladesh, unless and until the contrary is
proved.
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21 CHAPTER XVII
ON PENALTIES IN CASE OF DISHONOUR OF CERTAIN CHEQUES FOR INSUFFICIENCY
OF FUNDS IN THE ACCOUNTS
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Dishonour of cheque for
insufficiency, etc, of funds in the account
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138. 22[ (1)] Where any
cheque drawn by a person on an account maintained by him with a banker for
payment of any amount of money to another person from out of that account
23[ * * *] is returned
by the bank unpaid, either because of the amount of money standing to the
credit of that account is insufficient to honour the cheque or that it
exceeds the amount arranged to be paid from that account by an agreement
made with that bank, such person shall be deemed to have committed an
offence and shall, without prejudice to any other provision of this Act, be
punished with imprisonment for a term which may extend to one year, or with
fine which may extend to 24[ thrice] the amount
of the cheque, or with both:
(3) Notwithstanding anything contained in sub- section (1) and (2), the
holder of the cheque shall retain his right to establish his claim through
civil Court if whole or any part of the value of the cheque remains unrealized.]
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of six months
from the date on which it is drawn or within the period of its validity,
whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may
be, makes a demand for the payment of the said amount of money by giving a
notice, in writing, to the drawer of the cheque, within 25[ thirty days] of the
receipt of information by him from the bank regarding the return of the
cheque as unpaid, and
(c) the drawer of such cheque fails to make the payment of the said amount
of money to the payee or, as the case may be, to the holder in due course
of
the cheque, within 26[ thirty days] of the
receipt of the said notice.
27[ * * *]
28[ (1A) The notice
required to be served under clasue (b) of sub-section (1) shall be served
in the following manner-
(a) by delivering it to the person on whom it is to be served; or
(b) by sending it by registered post with acknowledgement due to that
person at his usual or last known place of abode or business in Bangladesh;
or
(c) by publication in a daily Bangla national newspaper having wide
circulation.]
29[ (2) Where any fine
is realized under sub-section (1), any amount upto the face value of the
cheque as far as is covered by the fine realized shall be paid to the
holder.
(3) Notwithstanding anything contained in sub- section (1) and (2), the
holder of the cheque shall retain his right to establish his claim through
civil Court if whole or any part of the value of the cheque remains
unrealized.]
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Restriction in respect of appeal
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30[ 138A.
Notwithstanding anything contained in the Code of Criminal Procedure, 1898, no appeal against
any order of sentence under sub-section (1) of section 138 shall lie,
unless an amount of not less than fifty per cent of the amount of the
dishonoured cheque is deposited before filing the appeal in the court which
awarded the sentence.]
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[Omitted]
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139. [Omitted by section 3 of the
Negotiable Instruments (Amendment) Act, 2000 (Act No. XVII of 2000).]
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Offences of Companies
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140. (1) If the person committing
an offence under section 138 is a company, every person who, at the time
the offence was committed, was in charge of, and was responsible to, the
company for the conduct of the business of the company, as well as the
company, shall be deemed to be guilty of the offence and shall be liable to
be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render any person
liable to punishment if he proves that the offence was committed without
his knowledge, or that he had exercised all due diligence to prevent the
commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), where any
offence under this Act has been committed by a company and it is proved
that the offence has been committed with the consent or connivance of, or
is attributable to, any neglect on the part of any director, manager,
secretary or other officer of the company, such director, manager, secretary
or other officer shall also be deemed to be guilty of that offence and
shall be liable to be proceeded against and punished accordingly.
Explanation - For the purposes of this section-
(a) “company” means any body corporate and includes a firm or other
association of individuals; and
(b) “director” in relation to a firm, means a partner in the firm.
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Cognizance of offences
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141. Notwithstanding anything
contained in the Code of Criminal Procedure,
1898 (Act V of 1898),-
(a) no court shall take cognizance of any offence punishable under section
138 except upon a complaint, in writing, made by the payee or, as the case
may be, the holder in due course of the cheque;
(b) such complaint is made within one month of the date on which the cause
of action arises under clause (c) of the proviso to section 138;
31[ (c) no court
inferior to that of a Court of Sessions shall try any offence punishable
under section 138.]]
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1 Throughout this
Act, except otherwise provided, the words “Bangladesh”, “Government” and
“Taka” were substituted, for the words “Pakistan”, Central Government” and
“Rs.” or “Rupees” respectively by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act,
1973 (Act No. VIII of 1973)
2 The words, figures and comma “Articles 23 and 24 of the Bangladesh Bank Order, 1972” were substituted, for
the words, figures and comma “Sections 24 and 25 of the State Bank of
Pakistan Act, 1956” by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act,
1973 (Act No. VIII of 1973)
3 Section 1A was inserted by section 3 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinanance No. XLIX of 1962)
4 Sections 21A, 21B and 21C were inserted by section 12 of the
Negotiable Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of
1962)
5 Section 27A was inserted by section 16 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
6 Sections 28A, 29A, 29B and 29C were inserted by section 19 of
the Negotiable Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX
of 1962)
7 Section 38A was inserted by section 23 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
8 Section 45A was inserted by section 3 of the Negotiable Instruments Act, 1885 (Act No. II of
1885)
9 Section 53A was inserted by section 28 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
10 Sections 57A and 57B were inserted by section 30 of the
Negotiable Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of
1962)
11 Section 71A was inserted by section 36 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
12 Section 75A was inserted by section 2 of the Negotiable
Instruments (Amendment)Act, 1920 (Act No. XXV of 1920)
13 The word “Dinajpur” was substituted, for the word “Sialkot”
by section 3 and 2nd Schedule of the Bangladesh Laws (Revision And Declaration) Act,
1973 (Act No. VIII of 1973)
14 Section 85A was inserted by section 2 of the Negotiable Instruments (Amendment) Act, 1930 (Act
No. XXV of 1930)
15 Section 104A was inserted by section 5 of the Negotiable Instruments Act, 1885 (Act No. II of
1885)
16 Section 122A was inserted by section 42 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
17 Section 123A was inserted by section 43 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
18 Section 125A was inserted by section 45 of the Negotiable
Instruments (Amendment) Ordinance, 1962 (Ordinance No. XLIX of 1962)
19 Section 131A was inserted by section 2 of the Negotiable Instruments (Amendment) Act, 1947 (Act
No. XXXIII of 1947)
20 Sections 131B, 131C, 131D, 131E, 131F, 131G, 131H and 131I
were inserted by the Negotiable Instruments (Amendment) Ordinance, 1962
(Ordinance No. XLIX of 1962)
21 The “CHAPTER XVII” including sections 138 to 141 were
substituted, for “CHAPTER XVII” including sections 138 and 139” by section
2 of the Negotiable Instruments (Amendment)
Act, 1994 (Act No. XIX of 1994).
22 The existing section was re-numbered as sub-section (1) by
section 2 of the Negotiable Instruments (Amendment)
Act, 2000 (Act No. XVII of 2000)
23 The words and commas “for the discharge, in whole or in part,
of any debt or other liability,” were omitted by section 2 of the Negotiable Instruments (Amendment) Act, 2000 (Act
No. XVII of 2000)
24 The word “thrice” was substituted, for the word “twice” by
section 2 of the Negotiable Instruments (Amendment)
Act, 2000 (Act No. XVII of 2000)
25 The words `thirty days` were substituted for the words
`fifteen days` by section 2 of the Negotiable Instruments (Amendment) Act, 2006 (Act
No. III of 2006)
26 The words `thirty days` were substituted, for the words
`fifteen days` by section 2 of the Negotiable Instruments (Amendment) Act, 2006 (Act
No. III of 2006)
27 The Explanation of sub-section (1) of section 138 was omitted
by section 2 of the Negotiable Instruments (Amendment)
Act, 2000 (Act No. XVII of 2000)
28 Sub-section (1A) was inserted by section 2 of the Negotiable Instruments (Amendment) Act, 2006 (Act
No. III of 2006)
29 Sub-sections (2) and (3) were added by section 2 of the Negotiable Instruments (Amendment) Act, 2000 (Act
No. XVII of 2000)
30 Section 138A was inserted by section 3 of the Negotiable Instruments (Amendment) Act, 2006 (Act
No. III of 2006)
31 Clause (c) of section 141 was substituted, for the former
clasue (c) by section 4 of the Negotiable Instruments (Amendment) Act, 2006 (Act
No. III of 2006)
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Copyright®2008,
Ministry of Law, Justice and Parliamentary Affairs
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