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    Question

    Where a cheque payable to order purports to be endorsed

    by or on behalf of the payee, the ­­_________ is discharged by payment in due course
    A drawer Correct Answer Incorrect Answer
    B drawee Correct Answer Incorrect Answer
    C acceptor Correct Answer Incorrect Answer
    D payee Correct Answer Incorrect Answer

    Solution

    As per Section 85 of NI Act  S. 85. Cheque payable to order.— (1) Where a cheque payable to order purports to be indorsed by or on behalf of the payee, the drawee is discharged by payment in due course. (2) Where a cheque is originally expressed to be payable to bearer, the drawee is discharged by payment in due course to the bearer thereof, notwithstanding any indorsement whether in full or in blank appearing thereon, and notwithstanding that any such indorsement purports to restrict or exclude further negotiation.

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