A Critical Analysis of the Provision Negotiable Instrument Act in India

Abstract

The initial draft of the Negotiable Instruments Act was prepared in 1866 by the 3rd India Law Commission and presented in the Council in December 1867 before being sent to a Select Committee. Despite this, it had to go through several iterations of modification and redrafting due to resistance. A new Law Commission was established in 1880 after the Secretary of State directed its referral. The Select Committee ultimately agreed with the majority of its recommendations. To govern the exchange of Negotiable Instruments such as "Promissory Notes," "Bill of Exchange," and "Cheques," the draught was presented in the Council and approved as the Negotiable Instruments Act, 1881 (“NI Act”) on 09 December 1881 and came into effect on 01 March 1882.[1]

[1] Goel, Shivam, “The Negotiable Instruments Act, 1881: Critical Analysis (November 10, 2016).” Available at SSRN: https://ssrn.com/abstract=2867355