Question

THREE DAYS OF GRACE ARE ADDED FOR ASCERTAINING THE DATE OF MATURITY IN CASE OF BILLS PAYABLE ON DEMAND. THE STATEMENT IS
a) Extremely true
b) Slightly true
c) Not true at all
d) Somewhat true

Answer 1

According to the Negotiable Instruments Act, 1181, a bill of exchange is defined as 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. The term maturity refers to the date on which a bill of exchange or promissory note becomes due for payment. In arriving at maturity date, three days, known as days of grace, must be added to the date on which the period of credit expires.