CA FOUNDATION BRAHMASTRA 2.0 |LAW| NEGOTIABLE INSTRUMENT ACT |LECTURE 25|CA ANKITA PATNI
Swapnil Patni CA Classesγ»2 minutes read
The session highlights section 138 of the Negotiable Instruments Act, emphasizing the bouncing of checks and the importance of issuing them for legally enforceable debts. It explains the validity period of checks, the responsibilities of holders, and the legal consequences for bounced checks, underlining the significance of timely presentation.
Insights
- Section 138 of the Negotiable Instruments Act is crucial as it deals with the bouncing of checks, emphasizing the importance of checks as a negotiable instrument and the legal consequences, including fines and imprisonment, for bounced checks issued for legally enforceable debts.
- Understanding sections 138, 139, and 140 is essential in check issuance and legal implications, as they specify that a check should only be issued for a legally enforceable debt, prohibit using insufficient funds as an excuse for check dishonor in court, and outline the necessary criteria for promissory notes to be considered valid, including delivery, endorsement, and presentation for acceptance.
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Recent questions
What is the significance of section 138?
Section 138 focuses on bounced checks.
How long is the validity period of a check?
Three months.
What are the consequences of a bounced check?
Fines and imprisonment.
What actions should be taken if a check bounces?
Notice of dishonor within 30 days.
What are the key points of sections 139 and 140?
Legally enforceable debts and insufficient funds.
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