EXAMPLE:

TYPES OF CROSSING

SCRUTINY OF CHEQUE Mutilation Crossing Date Payee Amount in words and Figure should Tally Alteration in cheque Available Balance Signature of Customer

AMOUNT

QUESTIONS: 1. If the space is insufficient for endorsement, it may be done on a paper attached to the cheques. Such an attachment is called an __________*Allonge 2. The elaborate enquiries has to be made by the bank or debtor before making the payment of the cheque *Necessary 3. What words are printed on the cheques issued to savings account customers ? *Or bearer` 4. Partners of a firm are called *Agents of the firm 5. In case of legal entities, the cheques should be signed for and on behalf of the entity. This is done by putting a ____________carrying the name of the entity and the position of the

signatory *Rubber stamp 6. If a cheque is crossed and restricted, its mode of payment is *Not treated as a condition. 7. Mr.Hari issues a cheque to Mr.Ram and it is dishonoured, hence here Ram can file a ________against Har *Suit 8. The promise to pay should be unconditional *Yes 9. Who can `transfer` an order instrument by `endorsing` it? *Payee 10. What is the penalty given to drawer in as per Section 138, when the cheque is dishonoured? *The drawer may be imprisoned for up to one year or asked to pay a fine of up to twice the amount of the cheque or both 11. Which of the following are the three negotiable instruments? *Promissory Notes*Cheques*Bills of Exchange 12. The procedure of re-presenting the bill to the drawee through a lawyer and getting the fact of dishonour confirmed is called *Protest 13. Who signs in the cheque? *Drawer 14. The usual form of signature in case of limited companies is as follows *For and on behalf of Company`s name (signed) Director 15. What is post dated cheque? *A cheque that bears a date later than the date of presentment for payment 16. If both order or bearer is written on an instrument, it will be treated as *A bearer instrument 17. ______ is necessary when there is contract or agreement between two persons. *Consideration 18. If a bearer cheque is missing,and the person who found out in favour of someone else, delivers it to a shop keeper, in payment of some purchase, the shop keeper becomes a holder in due course in case he did not know that the cheque had been missing *The debtor is duty bound to make payment to the holder in due course who `presents` the instrument to him for payment 19. Which of the features are not considered as condition? *Making the amount payable after a period of time, in a usance instrument 20. In case of Bills of exchange, the drawer is called the________and in case of promissory notes the drawer is called the______himself *Creditor and debtor 21. In which year was the NI ACT passed? *1881 22. A cheque is a *Demand bills of exchange 23. What is cheque? *A cheque is an instruction from the account holder to his bank to pay a certain sum of money to the person named in the cheque 24. The promise to pay whenever payee demands payment, is called *Demand promissory note 25. A holder of a cheque putting a date on an undated cheque is termed as alteration of cheque

*No 26. If a cheque is torn in one corner and is received from another bank, the presenting bank has to *put a stamp reading `Mutilation Guaranteed, Please Pay` and signed the guarantee, the cheque can be paid 27. The lenders take post dated cheques in repayment of the loan because of *Criminal liability for non payment of cheques 28. The provision of Sec 138 of the NI ACT came into effect from ___________ *1.4.1989 29. A usance promissory note has to be stamped by affixing non-judicial stamps of requisite value, as per __________Act *Stamp 30. In case of Death, insolvency or insanity of the drawer before date of cheque,postdated cheque should not be paid *true 31. Who has to give `notice of dishonour` to drawer in case of dishonour by non payment *Drawee 32. If the endorser merely signs his name without specifying the name of the person to whom payment must be made, it is called *Blank endorsement 33. The printed words on the cheques ,the words `or order` or `or bearer` are printed by the ________ *Bank 34. In case of Bills of exchange,a usance bill has to be stamped with __________________ as per stamp act. *Non Judicial stamps 35. If a person promises to supply goods, it is not a promissory note *True,it should be to pay money to another person not goods 36. What is Promissory Notes? *An instrument in writing containing an unconditional promise signed by the maker to pay a certain sum of money to a certain person or to the bearer of the instrument 37. The drawer is the person who makes and signs the promissory note *true option 38. A usance bill has to be `accepted` by the drawee or debtor before it becomes _________ *Valid 39. In case of Bills of exchange,the due date is calculated after adding______________of __days to the usance period *Grace period ,3 40. What are the words, `for value received` in a promissory note and bill of exchange considered as *Affirmation by the drawer 41. If the signature is forged, then no statutory protection is available to the bank for payment in due course. This is accordance with _______ (section of ACT)? *Sec 85 42. Who signs the promissory notes? *Signed by the promissory or the person who makes promise 43. If the account is operated by an authorized agent then cheque should contain *a `per pro` signature 44. What are the methods to write a usance bill *Three months from acceptance pay *Three months from date, pay*On 31.12.200X pay

45. If a bill is a demand or usance instrument, a cheque will be *Demand instrument 46. Banks make physical presentation of bills *False 47. A negotiable instrument must be *Unconditional 48. The debtor is duty bound to make payment to the holder in due course who `presents` the instrument to him for payment *true 49. Mr.Rahul given a cheque dated 2nd March 2007, if presented for payment on 29th Sep 2007, then it is *Not a postdated cheque *It is not valid postdated cheque 50. The requirement of endorsement should be *Unbroken and regular 51. If the bill is on due date the payee of a usance bill will need a confirmation from the _________ *Debtor 52. ______________is checked against the numbers of the cheques issued to the customer at the time of payment, *The serial number of the cheque 53. Who gets `discharged` from his obligations on payment to the holder in due course? *The Debtor 54. In the bills of exchange, person liable to pay the money is called as the *Drawee 55. Stale cheque can be paid if the cheque is dated more than 6 months *No 56. The original creditor cannot claim the amount from the debtor if the ___________has been made to the holder in due course *Payment 57. A bill of exchange contains an *Message 58. Where is endorsement made? *Endorsement is made on the back of instrument 59. When a cheque is made payable to Mr.X or bearer, the payee can transfer the instrument to another person by merely handing it over to him or mere `delivery`. *true 60. The promissor is maker and the promisee is called as payee.The former is________while the latter is the ___________ *Debtor and creditor 61. What is not required for transfering the bearer instrument? *Endorsement 62. Who gets a better title than the transferor *A holder in due course 63. A person who becomes a holder of a negotiable instrument, for valuable consideration and good faith and not knowing that the transferor did not have good title to it; is called _________. *`Holder in due course` 64. Without the signature ,the cheque is *Not Valid 65. ________ is defined as a bill of exchange drawn on a specified banker and not expressed to be

payable otherwise than on demand? *A cheque 66. What are the conditions which attract the penalty? *The dishonor of the cheque should be on account of insufficiency of funds*courts have imposed penalty for return of cheques due to stop payment instructions also on being convinced that the stop payment instructions were given deliberately to avoid payment 67. Bearer cheques are payable to the person who is in ____________ of the instrument *Only a 68. State true /false When a cheque is crossed to more than one banker, the paying banker will refuse payment *true 69. What has all the qualities of a negotiable instrument which is not listed in Negotiable Instrument Act? *A currency note 70. What is forgery of the cheque? *If any person other than the customer himself, without his specific authority to sign, signs by copying customer`s signature with the intention to prejudice that customer 71. The undated cheque is not valid but the bank can write the date on the cheque *No 72. What is the transferee or the `holder` of the instrument called *Transferee of the instrument 73. When a cheque being presented for payment, the following needs to be checked to confirm that the cheque is in order *Date*Payee*Amount in Words and Figures Should Tally*Alteration of the Cheque and Available Balance*Signature of the Customer and Payment at the Branch Where the Account is Held and Anywhere Banking*Bearer / Order cheques and endorsements 74. To whom the promissory note payment is to be made? *Payee 75. The payee of the order can make the instrument payable to another person by writing on the back of the cheque `Pay Mr.x________ or order` and putting his signature below it. Such a notation on the back of the cheque is called an *Endorsement 76. The cheques executed by a partner is always signed on behalf of the firm so as to bind the firm *Always 77. The date in the promissory note should be in left corner *False 78. The amounts of cheque in words and figures should tally *true 79. To confirm the date of the cheque presented for payment,the bank has to check whether it is *Both a and b 80. If a cheque is crossed, the paying banker cannot pay cash across the counter *true 81. If the cheque is mutilated or torn by accident, the drawer has to confirm in ________________that the cheque can be paid *Only B 82. Mr.Prakash is holding the bearer instrument, can he claim the amount from the drawee *Any one holding the bearer instrument, can claim the amount from the drawee. 83. A payees name has to be necessarily specified in cheques *Yes

84. State whether the statement is true or false A conditional promissory note or bill of exchange or cheque is a negotiable instrument *False 85. A person who draws a Bill of exchange is known as the ___________ *Drawer 86. An order instrument can be transferred by endorsement and delivery whereasa a ________ instrument can be transferred by mere delivery *Bearer instrument 87. A crossed cheque can only be_____________to the bank account of the _________ *Credited ,payee 88. Transferring of ownership, free from defect, through endorsement and delivery in the case of an order instrument and mere delivery in the case of a bearer instrument is called *Negotiability 89. Proving lack of consideration is on the drawer which can prompt the lender to take _________ cheques from their borrowers *Post dated 90. What is usance promissory note? *Both b and c 91. If the bills of exchange is accepted it has to be presented to________ on due date for the payment *Drawer 92. An instrument in writing, containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument is called *All of the above 93. The drawee of a cheque is__________ *Payee 94. If the amount stated in the cheque is different in words and figures, the amount in words cannot be paid *False 95. Mr.Arunkumar gives a cheque dated 1st Jan 2006,but other party presented only after 12 months,is it valid cheque *No,It is stale cheque 96. A cheque which been circulating for more than six months from the date on the cheque is considered _____________and cannot be paid. It can be paid only after it is revalidated by the drawer. *Stale 97. Who should date the Cheque? *Drawer 98. Which type of cheques do not grant an authority to debit the account of the customer till the date arrives? *Date without mentioned 99. A payee should not be a certain person True or false *false 100. If accounts are jointly operated,the alterations should be signed by all the authorised signatories as per the operating instructions *true 101. In the promissory note, if `monthly rests` is not paid immediately,______________will be payable by the drawer*Floating interest