CERTIFICATE COURSE ON NEGOTIABLE INSTRUMENTS

ACT

ASSIGNMENT

Name : - EESHANI MALHOTRA

Email ID :- eeshanimalhotra48355@gmail.com

Contact no. – 8958115146

Negotiable Instruments Act (ASSIGNMENT)

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ANALYTICAL QUESTIONS [Within 200 Words]

10 Marks Each
1. What measures shall be taken to make the enforcement of Section 138 of the
Negotiable Instruments Act more effective and speedier, looking at the present
growing concern for the same?

Ans. measures for enforcement of sec 138 is as follows:

 The cheque must be drawn in favour of a person who possess bank account.
 Cheque was returned unpaid by the bank to whom it is presented.
 Cheque must be presented within the period of 3 months.
 The payee demanded in writing for the amount to be paid by cheque.
 Notice period is 30 days.
 The complaint should have been made within 1 month of cause of action.

2. Which Courts have jurisdiction to entertain complaints under Section 138 of the
Negotiable Instruments Act ? Explain with reference to landmark case/cases?

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Ans.2- The metropolitan magistrate has the power to take cognizance on the case under sec
138 of the act. Section 251 of crpc is applicable to the summary trial under which the court
proceedings are done.

CASES: Rajesh aggarwal v state

Under this case the whole procedure is laid down about the conduct of proceedings of sec 138
of negotiable instrument act 1881

 The day on which the complaint is made its must be accompanied by affidavit and
then the scrutiny is done by the concerned magistrate.
 If accused is presented then he would be asked to present his plea of defence.
 If there is application for recalling of witness, the court shall decide the same.
 The court shall hear both the sides
 The court shall pass the final judgement

3. Explain the following :-

 Bearer Cheque
 Order Cheque
 Uncrossed Cheque
 Crossed Cheque
 Post Dated Cheque
 Stale Cheque

Ans. 3 Bearer cheque – It’s a cheque which is not cancelled. The amount in this is payable to
the person presenting it to encash in bank. The cashier pays the amount to the person who
presents it.

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Order cheque - The cheque which is payable to a particular person. The word order here is it
is ordered to pay to a particular person. The payee can further write the name of the person on
the back of the cheque to pay the amount.

Uncrossed cheque- the cheque which is not crossed, its an open cheque. The order cheque
and bearer cheque is an uncrossed cheque.

Crossed cheque- A crossed cheque is the one in which two parallel lines on the left is drawn.
It can not be encash at the counter of bank. Its a safer way to transfer money.

Postdated cheque- Its a cheque in which future date is mentioned.

Stale cheque- If a cheque is presented for a payment after 6 months from the date of cheque
its stale cheque.

4. Considering the present day developments, how do you think some aspects of the
Negotiable Instruments Act be bought online?

Ans. 4

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 5. What were the 2015 and 2018 Amendments to the Negotiable Instruments Act? What
purpose would they serve?

Ans. 5 The 2015 amendment solved the problem of legal blockage. The cheque was
presented at one place and collected at other of different branch. The payee had to chase the
accused at different places. But with amendment in 2015 the law become more clear and
trials were speed up.

The new amendment was that holder of the cheque can file a criminal complaint to the
magistrate where he resides. He need not to go the place where cheque was issued. Litigation
expenses came down and company directors became more careful while sighing the cheque.
The process got simplified.

Later the loksabha passed the new amendment on july 23rd 2018 in which a new section 143A
got introduced, which gives power to the court that drawer will pay compensation as per the
complaint not exceeding 20%of the cheque amount. Moreover , the amount must be paid
within 60 days of the order.

The aim of this amendment was to give relief to the payee regarding dishonour of cheque
problem.

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