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1. A cheque must be presented:
a. To the payee
b. At the bank on which it is drawn
c. To the drawer
d. To the court
2. Presentment must occur before:
a. The cheque expires
b. The relation between drawer and banker is altered to prejudice of drawer
c. Bank closes
d. Court order
3. Section 72 operates subject to:
a. Section 80
b. Section 60
c. Section 90
d. Section 84
4. If cheque is not presented before the banker-drawer relation changes:
a. Drawer may not be liable
b. Bank becomes liable
c. Government pays
d. Holder loses cheque
5. Section 73 of the Negotiable Instruments Act deals with:
a. Presentment of cheque to charge persons other than drawer
b. Negotiation
c. Acceptance
d. Dishonour
6. A cheque must be presented to charge persons other than drawer:
a. Immediately
b. Within reasonable time after delivery
c. After maturity
d. After endorsement
7. The person referred to in this section may include:
a. Indorser
b. Prior parties
c. Both A and B
d. Bank officer
8. The time counted for presentment begins from:
a. Date of cheque
b. Delivery by such person
c. Date of endorsement
d. Bank clearing
9. Failure to present within reasonable time may:
a. Discharge such persons
b. Increase liability
c. Cancel cheque
d. Transfer ownership
10. Section 74 of the Negotiable Instruments Act deals with:
a. Presentment of instrument payable on demand
b. Negotiation
c. Acceptance
d. Dishonour
11. A negotiable instrument payable on demand must be presented:
a. Immediately
b. Within reasonable time after receipt by holder
c. After maturity
d. After endorsement
12. Section 74 operates subject to:
a. Section 30
b. Section 40
c. Section 31
d. Section 60
13. The responsibility to present lies with:
a. Drawer
b. Holder
c. Bank
d. Government
14. Section 75 of the Negotiable Instruments Act deals with:
a. Presentment by or to agent, legal representative or assignee
b. Negotiation
c. Acceptance
d. Dishonour
15. Presentment for acceptance or payment may be made to:
a. Authorized agent of drawee, maker or acceptor
b. Legal representative of deceased party
c. Assignee of insolvent
d. All of the above
16. The agent must be:
a. Banker
b. Duly authorized
c. Government officer
d. Court officer
17. If the maker or drawee has died, presentment may be made to:
a. Court
b. Legal representative
c. Bank manager
d. Drawer
18. If the drawee or maker becomes insolvent:
a. Presentment Assignee
b. Presentment to officer
c. Presentment to bank
d. Presentment to court
19. Section 75A of the Negotiable Instruments Act deals with:
a. Excuse for delay in presentment
b. Negotiation
c. Acceptance
d. Dishonour
20. Delay in presentment is excused when:
a. Holder forgets
b. Delay caused by circumstances beyond holder’s control
c. Bank delays
d. Drawer refuses
21. The delay must not be due to:
a. Holder’s negligence
b. Holder’s misconduct
c. Holder’s default
d. All of the above
22. Delay may be excused for presentment for:
a. Acceptance
b. Payment
c. Both A and B
d. Negotiation
23. Once the cause of delay ceases:
a. Presentment unnecessary
b. Presentment must be made within reasonable time
c. Instrument cancelled
d. Bank decides
24. Section 76 of the Negotiable Instruments Act deals with:
a. Cases where presentment for payment is unnecessary
b. Dishonour of cheque
c. Negotiation
d. Acceptance
25. When presentment is unnecessary, the instrument is deemed:
a. Accepted
b. Dishonoured at the due date for presentment
c. Negotiated
d. Cancelled
26. Presentment is unnecessary if the maker, drawee or acceptor:
a. Refuses to sign
b. Endorses instrument
c. Changes bank
d. Intentionally prevents presentment
27. If an instrument payable at the place of business of the maker or acceptor and he closes that place during usual business hours on a business day:
a. Presentment becomes invalid
b. Instrument becomes void
c. Presentment is unnecessary
d. Drawer becomes liable
28. When the instrument is payable at a specified place but neither the liable party nor authorized person attends there during business hours:
a. Presentment becomes unnecessary
b. Presentment is mandatory
c. Instrument is cancelled
d. Holder loses rights
29. If the instrument is not payable at a specified place and the maker or drawee cannot be found after due search:
a. Presentment must still be made
b. Presentment becomes unnecessary
c. Instrument becomes void
d. Bank must pay
30. Presentment is unnecessary against a party who:
a. Endorsed instrument
b. Engaged to pay notwithstanding non-presentment
c. Delivered instrument
d. Registered instrument
31. If after maturity a party knowing that presentment was not made:
a. Makes part payment
b. Promises to pay wholly or partly
c. Waives right to object to non-presentment
d. All of the above
32. Presentment is unnecessary against the drawer when:
a. Drawer has died
b. Drawer cannot suffer damage from want of presentment
c. Drawer is insolvent
d. Drawer signs again
33. Section 77 of the Negotiable Instruments Act deals with:
a. Liability of banker for negligent handling of bill
b. Dishonour of cheque
c. Negotiation
d. Acceptance
34. This section applies to a:
a. Promissory note
b. Bill of exchange
c. Cheque
d. Currency note
35. The bill must be accepted payable at:
a. A court
b. A specified bank
c. Government office
d. Payee’s house
36. The bill must have been:
a. Duly presented at the bank for payment
b. Registered
c. Endorsed
d. Negotiated
37. Liability arises when the bill is:
a. Accepted
b. Registered
c. Negotiated
d. Dishonoured
38. The banker becomes liable when he:
a. Refuses acceptance
b. Endorses the bill
c. Negligently keeps or deals with the bill
d. Cancels the bill
39. Improper handling includes:
a. Negligently keeping the bill
b. Improperly dealing with the bill
c. Improperly returning the bill
d. All of the above
40. Section 78 of the Negotiable Instruments Act deals with:
a. To whom payment should be made
b. Interest
c. Delivery of instrument
d. Negotiation
41. Payment of a promissory note, bill of exchange or cheque must be made to:
a. Drawer
b. Drawee
c. Holder of the instrument
d. Bank officer
42. Payment made to the holder results in:
a. Transfer of ownership
b. Discharge of maker or acceptor
c. Cancellation of cheque
d. Endorsement
43. Section 78 is subject to provisions of:
a. Section 60
b. Section 53
c. Section 90
d. Section 82(c)
44. If payment is not made to the holder:
a. Maker remains discharged
b. Maker or acceptor may not be discharged
c. Bank becomes liable
d. Government pays
45. The rule applies to:
a. Promissory notes
b. Bills of exchange
c. Cheques
d. All of the above
46. Section 79 of the Negotiable Instruments Act deals with:
a. Interest when rate specified
b. Payment rules
c. Negotiation
d. Dishonour
47. When a promissory note or bill of exchange specifies a rate of interest:
a. Interest cannot be claimed
b. Interest must be calculated at the specified rate
c. Bank decides interest
d. Court fixes interest automatically
48. Interest is calculated on:
a. Total amount including interest
b. Principal amount due
c. Bank charges
d. Court fees
49. Interest begins from:
a. Date of endorsement
b. Date of instrument
c. Date of instrument
d. Date of dishonour
50. Interest continues until:
a. Tender of payment
b. Realization of amount
c. Date directed by court after suit
d. All of the above
51. Section 80 of the Negotiable Instruments Act deals with:
a. Interest when no rate specified
b. Negotiation
c. Acceptance
d. Dishonour
52. When no rate of interest is specified in the instrument:
a. No interest payable
b. Interest payable at 18% per annum
c. Interest payable at 10%
d. Bank decides rate
53. The interest rate prescribed is:
a. 12%
b. 15%
c. 18%
d. 24%
54. Interest is calculated from:
a. Date of instrument
b. Date when amount ought to have been paid
c. Date of endorsement
d. Date of negotiation
55. Interest runs until:
a. Tender of payment
b. Realization of amount
c. Date directed by court after suit
d. All of the above
56. Any agreement between parties regarding interest:
a. Overrides the section
b. Does not override statutory rate
c. Cancels instrument
d. Requires court approval
57. If the party charged is an indorser:
a. Interest begins from notice of dishonour
b. Interest begins from date of date of instrument
c. Interest begins from endorsement
d. Interest begins from negotiation
58. The explanation under Section 80 concerns:
a. Drawer
b. Indorser
c. Bank
d. Government
59. Section 80 ensures:
a. Minimum statutory interest
b. Bank interest
c. Government rate
d. Court interest
60. Section 81 of the Negotiable Instruments Act deals with:
a. Delivery of instrument on payment or indemnity if lost
b. Negotiation
c. Dishonour
d. Acceptance
61. A person liable to pay the instrument is entitled before payment:
a. To cancel instrument
b. To have the instrument shown to him
c. To destroy instrument
d. To endorse instrument
62. After payment the payer is entitled:
a. To keep copy
b. To have the instrument delivered to him
c. To negotiate instrument
d. To register instrument
63. If the instrument is lost or cannot be produced:
a. Payment unnecessary
b. Instrument cancelled
c. Payer must be indemnified against future claims
d. Bank pays
64. The rule applies to:
a. Promissory notes
b. Bills of exchange
c. Cheques
d. All of the above
65. When the cheque is an electronic image of a truncated cheque:
a. Drawer keeps cheque
b. Bank receiving payment may retain the truncated cheque
c. Holder retains cheque
d. Court retains cheque
66. The banker paying such cheque may issue:
a. Receipt
b. Certificate on printout of electronic image
c. Endorsement
d. Draft
67. Section 82 of the Negotiable Instruments Act deals with:
a. Discharge from liability
b. Negotiation
c. Presentment
d. Dishonour
68. The maker, acceptor or indorser of a negotiable instrument may be discharged:
a. By cancellation
b. By release
c. By payment
d. All of the above
69. Discharge by cancellation occurs when:
a. Holder cancels the name of maker, acceptor or indorser with intent to discharge
b. Bank cancels cheque
c. Court cancels instrument
d. Drawer destroys instrument
70. Cancellation by holder discharges liability:
a. Only of maker
b. Only of acceptor
c. Of the person whose name is cancelled
d. Of bank
71. Discharge by release occurs when:
a. Holder releases the maker, acceptor or indorser
b. Bank releases cheque
c. Court releases payment
d. Drawer withdraws instrument
72. Section 83 of the Negotiable Instruments Act deals with:
a. Discharge when drawee given more than 48 hours to accept
b. Presentment rules
c. Negotiation rules
d. Dishonour
73. The section applies to:
a. Promissory notes
b. Bills of exchange
c. Cheques
d. Currency notes
74. The drawee normally gets:
a. 24 hours
b. 36 hours
c. 48 hours
d. 72 hours
75. The forty-eight hours allowed exclude:
a. Sundays
b. Public holidays
c. Banking holidays
d. Court holidays
76. If the holder allows more than 48 hours for acceptance:
a. All parties remain liable
b. Previous parties not consenting are discharged
c. Bank becomes liable
d. Instrument becomes void
77. Section 84 of the Negotiable Instruments Act deals with:
a. Consequences of delay in presentment of cheque
b. Negotiation
c. Acceptance
d. Dishonour
78. If a cheque is not presented within a reasonable time:
a. Drawer always liable
b. Drawer may be discharged to extent of damage
c. Holder loses cheque
d. Bank becomes liable
79. The drawer must suffer:
a. No loss
b. Actual damage due to delay
c. Bank loss
d. Government loss
80. The discharge of drawer is limited to:
a. Full cheque amount
b. Extent of damage suffered
c. Bank balance
d. Interest only
81. Reasonable time depends on:
a. Nature of instrument
b. Usage of trade and bankers
c. Facts of the case
d. All of the above
82. If drawer is discharged, the holder becomes:
a. Creditor of bank
b. Debitor of bank
c. Drawer
d. Acceptor
83. In such case holder may recover amount from:
a. Drawer
b. Banker
c. Government
d. Court
84. If cheque is not presented and bank fails:
a. Drawer discharged if funds existed
b. Holder loses rights
c. Bank pays government
d. Court cancels cheque
85. If no actual damage is caused:
a. Drawer discharged
b. Drawer not discharged
c. Bank liable
d. Holder liable
86. Section 85 of the Negotiable Instruments Act deals with:
a. Cheque payable to order
b. Negotiation
c. Dishonour
d. Interest
87. When a cheque payable to order appears endorsed by or on behalf of the payee:
a. Payment invalid
b. Drawee discharged by payment in due course
c. Drawer discharged
d. Holder discharged
88. The drawee refers to:
a. Drawer
b. Payee
c. Bank on which cheque is drawn
d. Holder
89. Payment must be made:
a. Immediately
b. In due course
c. With court approval
d. With bank approval
90. When a cheque is originally payable to bearer:
a. Payment must be made to drawer
b. Payment to bearer discharges drawee
c. Payment to payee only
d. Payment invalid
91. Payment to bearer discharges drawee even if:
a. Cheque endorsed in full
b. Cheque endorsed in blank
c. Endorsement restricts further negotiation
d. All of the above
92. The protection under Section 85 applies to:
a. Drawer
b. Drawee bank
c. Holder
d. Indorser
93. Payment must be made:
a. In good faith
b. According to apparent tenor
c. Without negligence
d. All of the above
94. Section 85 protects banks when:
a. Paying forged cheques
b. Paying cheques endorsed apparently by payee
c. Cancelling cheques
d. Negotiating cheques
95. Section 85A of the Negotiable Instruments Act deals with:
a. Drafts drawn by one branch of bank on another payable to order
b. Negotiation
c. Dishonour
d. Presentment
96. A draft under this section means:
a. Cheque
b. Order to pay money
c. Promissory note
d. Bank receipt
97. The draft is drawn by:
a. One office of bank
b. Government office
c. Payee
d. Drawer
98. The draft is drawn upon:
a. Another office of same bank
b. Government treasury
c. Court
d. Payee bank
99. The draft must be payable:
a. After date
b. After sight
c. On demand
d. On maturity
100. The draft must be payable:
a. To order
b. To bearer
c. To government
d. To bank manager
101. If the draft appears endorsed by or on behalf of payee:
a. Payment invalid
b. Bank discharged by payment in due course
c. Drawer discharged
d. Holder discharged
102. Payment must be:
a. Conditional
b. In due course
c. By court order
d. By government
103. Protection under Section 85A applies to:
a. Holder
b. Drawer
c. Bank
d. Government
104. Section 86 of the Negotiable Instruments Act deals with:
a. Effect of qualified or limited acceptance
b. Negotiation
c. Dishonour
d. Payment
105. If the holder acquiesces in a qualified acceptance:
a. All parties remain liable
b. Previous parties not consenting are discharged
c. Drawer becomes liable
d. Bank becomes liable
106. Qualified acceptance may involve:
a. Acceptance for part of sum
b. Change in place or time of payment
c. Conditional acceptance
d. All of the above
107. Previous parties are discharged unless:
a. Court orders otherwise
b. Bank approves
c. They consent to such acceptance
d. Drawer signs again
108. Consent may be given:
a. Without notice
b. After bank approval
c. After court order
d. After notice by holder
109. Acceptance is qualified if payment depends on:
a. Drawer’s order
b. Happening of an event
c. Bank approval
d. Court decree
110. Acceptance is qualified where payment is for:
a. Whole amount
b. Part of the amount
c. Double amount
d. Bank charges
111. Acceptance is qualified where:
a. Different place of payment is substituted
b. Same place of payment remains
c. Payment cancelled
d. Bank changes rate
112. Acceptance is qualified where payment is:
a. At time different from original due date
b. Immediately
c. After endorsement
d. On demand
113. Section 87 of the Negotiable Instruments Act deals with:
a. Effect of material alteration
b. Negotiation
c. Acceptance
d. Dishonour
114. A material alteration of a negotiable instrument:
a. Makes it valid
b. Renders it void against parties not consenting
c. Transfers ownership
d. Creates new instrument
115. The alteration must be:
a. Material
b. Minor
c. Temporary
d. Verbal
116. If alteration is made without consent:
a. Instrument remains valid
b. Holder loses rights
c. Bank becomes liable
d. Parties not consenting are discharged
117. Alteration is valid if made:
a. For bank approval
b. By court order
c. To carry out common intention of original parties
d. By government
118. If alteration is made by an indorsee:
a. Indorser remains liable
b. Indorser is discharged from liability to him
c. Drawer discharged
d. Bank liable
119. The provisions of Section 87 are subject to:
a. Sections 20, 49, 86 and 125
b. Sections 10 and 20
c. Sections 70 and 71
d. Sections 30 and 31
120. Material alteration includes:
a. Change in date
b. Change in amount
c. Change in place of payment
d. All of the above
121. Section 88 of the Negotiable Instruments Act deals with:
a. Liability despite previous alteration
b. Negotiation
c. Dishonour
d. Presentment
122. An acceptor remains bound by his acceptance:
a. Only if drawer agrees
b. Only if alteration approved by court
c. Only if bank approves
d. Even if previous alteration exists
123. An indorser remains bound by his indorsement:
a. Notwithstanding previous alteration
b. Only if instrument unchanged
c. Only if court approves
d. Only if bank agrees
124. Section 89 of the Negotiable Instruments Act deals with:
a. Payment where alteration not apparent
b. Negotiation
c. Acceptance
d. Dishonour
125. If a negotiable instrument is materially altered but alteration is not apparent:
a. Payment invalid
b. Payment in due course discharges payer
c. Holder loses rights
d. Instrument cancelled
126. The rule applies when payment is made:
a. According to apparent tenor
b. According to bank rules
c. According to court order
d. According to drawer’s instruction
127. Payment must also be:
a. In due course
b. Partial
c. Conditional
d. Delayed
128. Such payment discharges:
a. Holder
b. Person or banker liable to pay
c. Drawer
d. Indorser
129. Payment cannot be questioned merely because:
a. Instrument altered
b. Cheque crossed
c. Crossing obliterated
d. All of the above
130. For truncated cheques, difference between electronic image and original:
a. Not important
b. Considered material alteration
c. Minor error
d. Ignored
131. Bank or clearing house must ensure:
a. Accuracy of electronic image
b. Court approval
c. Drawer signature
d. Government verification
132. Receiving bank must verify:
a. Image exactly matches transmitted image
b. Drawer signature
c. Court approval
d. Government notice
133. Section 90 of the Negotiable Instruments Act deals with:
a. Extinguishment of rights when bill in acceptor’s hands
b. Negotiation
c. Dishonour
d. Payment
134. The section applies to:
a. Promissory note
b. Bill of exchange
c. Cheque
d. Bank draft
135. The bill must have been:
a. Negotiated
b. Accepted only
c. Cancelled
d. Registered
136. The bill must come into possession of:
a. Holder
b. Drawee
c. Acceptor
d. Payee
137. The acceptor must hold the bill:
a. As agent
b. In his own right
c. As banker
d. As trustee
138. The bill must be held by acceptor:
a. Before maturity
b. Before acceptance
c. At or after maturity
d. Before negotiation
139. Section 91 of the Negotiable Instruments Act deals with:
a. Dishonour by non-acceptance
b. Dishonour by non-payment
c. Negotiation
d. Presentment
140. Dishonour by non-acceptance applies to:
a. Promissory notes
b. Cheques
c. Bills of exchange
d. Currency notes
141. A bill is dishonoured by non-acceptance when:
a. Drawee refuses to sign
b. Drawee defaults in acceptance when required
c. Holder delays presentment
d. Drawer refuses payment
142. When there are several drawees not partners:
a. Only one acceptance is enough
b. Default by one may cause dishonour
c. Bank decides acceptance
d. Court decides acceptance
143. If presentment for acceptance is excused and bill is not accepted:
a. Bill is dishonoured
b. Bill is valid
c. Bill becomes void
d. Bill becomes cheque
144. If the drawee is incompetent to contract:
a. Bill remains valid
b. Bill may be treated as dishonoured
c. Holder must negotiate again
d. Drawer must accept
145. Acceptance that is qualified may result in:
a. Negotiation
b. Cancellation
c. Cancellation
d. Dishonour
146. Dishonour by non-acceptance occurs:
a. Before payment stage
b. After payment
c. After endorsement
d. After negotiation
147. The party who fails to accept is:
a. Indorsee
b. Drawer
c. Drawee
d. Indorser
148. Section 92 of the Negotiable Instruments Act deals with:
a. Dishonour by non-payment
b. Dishonour by non-acceptance
c. Negotiation
d. Presentment
149. A promissory note is dishonoured by non-payment when:
a. Maker defaults in payment
b. Drawer refuses acceptance
c. Payee delays
d. Bank closes
150. A bill of exchange is dishonoured by non-payment when:
a. Drawer refuses payment
b. Acceptor defaults in payment
c. Payee refuses acceptance
d. Indorser cancels bill
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