Question

Explain the following terms: i. Renewal of a bill ii. Retirement of a bill iii. Noting charges iv. Days of grace

Answer 1

i. RENEWAL OF A BILL

Sometimes the acceptor expresses his inability to meet the bill on due date and requests the holder, i.e., the Drawer, to substitute the old bill with a new bill. The purpose is to get an extension of time. If the Drawer agrees, the old bill is cancelled and a new bill is drawn and accepted by the Drawee. This process is called Renewal of a Bill.

ii. RETIREMENT OF A BILL

When the Drawee or the acceptor pays the amount of the bill before the date of maturity, it is called Retirement of a Bill.

iii. NOTING CHARGES

Noting Charges is the fee paid to the Notary Public for noting and protesting the Bill of Exchange of its dishonour.

iv. DAYS OF GRACE

Days of Grace are three extra days added to the period of the Bill. It is a custom to add the days of Grace.

Answer 2

_________HEY MATE_________

RENEWAL OF BILL----------

>When the acceptor of a bill is not in a position to meet the bill on its due date ,he made with the consent of the holder accept a fresh bill in place of the old bill .

RETIREMENT OF BILL------------

>When the drawer paid the bill before its due date it is called a retirement of a bill .

NOTING CHARGES

>Noting charges is the fees paid to the notary public for noting and protesting the bill of exchange of its dishonour .

DAYS OF GRACE------------

>Days of grace are 3 extra day is added to the period of Bill .It is a custom to add the days of Grace.

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