Question

Objective of promissory note

Answer 1

Before going to promissory note it is essential to know that it is nothing but a negotiable instrument.
The instrument which is used for future payment and based on mutual understanding is known as negotiable instrument. Now comes on promissory note. Promissory note also called "pro note" is defined in section 4 of negotiable instrument act 1881. There are two parties in pro note. One is creditor also called acceptor and another is Debtor,also called writer or drawer. The denomination is written on the notes that debtor gives to creditor for certain days. when acceptor fails to make payment to writer, he(acceptor) is given 3 extra days to repay and this is known as days of grace.