Negotiable instruments act
This query is : Resolved
11 April 2017
respected sir/mam,
i couldnt understand the phrase: a note payable to the maker is not a promissorynote unless it is endorsed by the maker.
can u please help me?
i couldnt understand the phrase: a note payable to the maker is not a promissorynote unless it is endorsed by the maker.
can u please help me?
CA Gopal Somani
(Expert)
12 April 2017
It's like you can't write a promissory note saying that "I promise to pay myself Rs ..... on the day....."
But if you endorse it in somebody's name (transfer it to somebody) then it becomes a promissory note as you have to pay the amount to somebody else.
So a note will not be called as promissory note if it is payable to maker him/herself. But when he/she endorse it (transfer it) to somebody else's name then it becomes promissory note.
i hope it will be clear. Let me know if you have further questions.
But if you endorse it in somebody's name (transfer it to somebody) then it becomes a promissory note as you have to pay the amount to somebody else.
So a note will not be called as promissory note if it is payable to maker him/herself. But when he/she endorse it (transfer it) to somebody else's name then it becomes promissory note.
i hope it will be clear. Let me know if you have further questions.
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