Examples given in Holder in due Course

Sir, In the video, an example given by madam in Holder in due course is -a person fraudly signing the BOE for Endorsement, then the person who receiving that become A Holder in due course since it received in good faith. But in the very next video with an example -there clarified that he is not a holder in due course since that instrument at the very first was Fraudulently singed. So please clarify this to finish the doubt.

Pranav Connecting...

Pranav Connecting...

CA Inter


10-Jun-20 18:28


Answers (2)

There are two aspects here. If an instrument was originally created fraudently - the holder cannot enforce it and hence he wont be a holder in due course. If an instrument was originally created properly and endorsement was forged, a holder in good faith becomes a holder in due course.

Suraj Lakhotia

Suraj Lakhotia


10-Jun-20 18:30