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Negotiable instrument

Can some one explain the meaning of section 46 of negotiable instrument act (in below image)

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Sri kanaga Varshini

Sri kanaga Varshini

CA Inter

1K+

29-Mar-21 22:09

39

Answers (2)

This means that when the negotiable instrument is endorsed / delivered conditionally or for a special purpose, , absolute property in the instrument will not pass to the transferee, except where the transferee is holder in due course. Eg: Cheque endorsed with a condition it should not be enchased untill some event. Now, if it is encashed by any holder prior to the event, he/she will be liable to return money except if it is encashed by holder in due course.


Sahibdeep Singh

Sahibdeep Singh

Moderator

30-Mar-21 13:23

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