This presentation will help the students of B.Com. 1 st year.

1. By: Dr. Neetu Sharma
Associate Professor
Career College,Bhopal

2. The Negotiable Instrument Act
The advent of modern business practices contributed to the
growth of newer ways of facilitating financial transactions.
Previously, cash was the most common mode of exchanging
goods and services for their value. The rise of negotiable
instruments, however, brought radical changes in business
practices. These days there are several types of such
instruments which have made commerce simpler.
These instruments are nothing but documents which have
monetary value and are exchangeable. Hence, the two main
characteristics of Negotiable Instruments are financial
worth and transferability.

3. Definition:
Section 13 of the Negotiable instrument Act states that a Negotiable
Instrument is a promissory note, bill of exchange, or a Cheque
payable either to order or to bearer.

4. Characteristics of Negotiable Instrument:
-It should be freely transferable either by simple delivery or by
endorsement and delivery.
-Defects in the title of sellers of these instruments do not affect
persons who purchase them in good faith.
-Holders of these instruments can sue upon them in their own
names.
- Endorsablity
-Date should be mentioned.
-Signature of the Drawer.

5. Types of Negotiable Instrument
 Promissory notes
 Bill of exchange
 Cheque
 Government promissory notes
 Delivery orders
 Customs Receipts

9. Thank You