What is Promissory note ?

Section – 4, NEGOTIABLE INSTRUMENTS ACT, 1881

” Promissory note “

4. A ” promissory note ” is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.

Illustrations

A signs instruments in the following terms :

(a) “I promise to pay B or order Rs. 500″.
(b) “I acknowledge myself to be indebted to B in Rs. 1, 000, to be paid on demand, for value received.”
(c) “Mr B, I.O.U Rs. 1,000.”
(d) “I promise to pay B Rs. 500 and all other sums which shall be due to him.”
(e) “I promise to pay B Rs. 500 first deducting thereout any money which he may owe me.”
(f) I promise to pay B Rs. 500 seven days after my marriage with C .
(g) I promise to pay B Rs. 500 on D‘s death, provided D leaves me enough to pay that sum.
(h) I promise to pay B Rs. 500 and to deliver to him my black horse on 1st January next.

The instruments respectively marked (a) and (b) are promissory notes. The instruments respectively marked (c), (d), (e), (f), (g) and (h) are not promissory notes.

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