Ni act...

The text you provided refers to the legal responsibility of a banker when handling a bill of exchange that has been dishonored. This specific provision is found in Section 77 of the Negotiable Instruments Act, 1881.

Explanation of the Law

Under Section 77, if a bill of exchange is accepted as payable at a specific bank and is subsequently dishonored after being duly presented, the bank has a duty of care regarding how it handles that instrument.

If the banker acts negligently or improperly in keeping, dealing with, or returning the bill, and that negligence directly causes financial loss to the holder, the bank is legally required to compensate the holder for that loss.

Key Elements of Section 77:

• Scope: It applies specifically to a bill of exchange that has been:

  • Accepted by the drawee.

  • Made payable at a specified bank.

  • Duly presented for payment at that bank.

  • Dishonored (refused payment).

• Negligence: The banker must have been negligent or improper in their actions (e.g., losing the bill, delaying its return, or delivering it to the wrong person).

• Resulting Loss: The holder must prove that the banker's negligence was the cause of an actual loss. The compensation is intended to restore the holder to the position they would have been in if the bank had handled the instrument with reasonable care.

Summary

The text you shared is a paraphrase of Section 77 of the Negotiable Instruments Act, 1881. It establishes that a bank can be held liable for damages if it mishandles a dishonored bill of exchange through negligence or improper conduct, thereby causing financial loss to the bill's holder.