become the payee. Similarly, if Harish Chander gets this promissory note

become the payee. Similarly, if Harish Chander gets this promissory note discounted from the bank then the bank will become the payee. Box Distinction between a Bill of Exchange and Promissory Note Both a bill of exchange and a promissory note are instruments of credit and are similar in many ways. However, there are certain basic differences between the two. S. No Basis Promissory Note Drawer It is drawn by the creditor It is drawn by the debtor Order or Promise It contains an order to make It contains a promise to make and Parties payment. There can be three payment. There are only two parties to it, viz. the drawer, parties to it, viz. the drawer the drawee and the payee. and the payee. Acceptance It requires acceptance by the It does not require any drawee or someone else on his acceptance. behalf. . Payee Drawer and payee can be the Drawer cannot be the payee same party. of it. . Notice In case of its dishonour due No notice needs to be givenin notice of dishonour is to be case of its dishonour. given by the holder to the drawer Fig. . Distinction between bills of exchange and promissory note