‘Nakul’ made promissory note in favour of ‘Sahdev’ of 10,000 and delivered to him. ‘Sahdev’ indorsed the promissory note in favour of ‘Arjun’ but…

(i) According to Section 48 of the Negotiable Instrument Act 1881, a promissory note, bill of exchange or cheque payable to order, is negotiable by the holder by indorsement and delivery thereof. Further, delivery of an instrument is essential whether the instrument is payable to bearer or order for effecting the negotiation. The delivery must be voluntary, and the object of delivery should be to pass the property in the instrument to the person to whom it is delivered. The delivery can be, actual or constructive. Actual delivery takes place when the instrument changes hand physically. Constructive delivery takes place when the instrument is delivered to the agent, clerk or servant of the indorsee on his behalf or when the indorser, after indorsement, holds the instrument as an agent of the indorsee. In the instant case, ‘Sahdev’ received a promissory note from ‘Nakul’ and indorsed the promissory note in favour of ‘Arjun’ and delivered to Arjun’s agent. Subsequently, Arjun’s agent died, and promissory note was found by ‘Arjun’ in his agent’s table drawer. ‘Arjun’ sued ‘Nakul’ for the recovery of promissory note. An order negotiable instrument can be transferred by endorsement and delivery. As delivery to Arjun’s agent is sufficient delivery of promissory note to Arjun. Therefore, ‘Arjun’ is eligible to claim the payment of promissory note. (ii) According to Section 61 of the Negotiable Instruments Act, 1881, a bill of exchange must be presented to the drawee thereof for acceptance 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. Further, section 63 provides that the holder must, if so required by the drawee of a bill of exchange presented to him for acceptance, allow the drawee 48 hours (exclusive of public holidays) to consider whether he will accept it. In the instant case, Saksham drawn a bill of exchange on Utkarsh and on request of Utkarsh, he allowed 48 hours to accept the bill. The bill was sent at 3:00 pm on 14 th August. Bill was not accepted till 3:00 pm of 16 th August. Saksham treated the bill as dishonoured for non-acceptance. Here, As 15 th August is a public holiday, his 48 hours would end on 17 th August not on 16 th August. Hence, bill could not be treated as dishonoured on 16 th August.