Bill of Exchange

the maturity date. But when an emergent holiday is declared under the Negotiable Instruments Act , by the Government of India which may happen to be the date of maturity of a bill of exchange, then the date of maturity will be the next working day immediately after the holiday. For example, the Government declared a holiday on April which happened to be the day on which a bill of exchange drawn by Gupta upon Verma for Rs. , became due for payment, Since April , has been declared a holiday under the Negotiable Instruments Act, therefore, April , will be the date of maturity for this bill.

If the holder of the bill needs funds, he can approach the bank for encashment of the bill before the due date. The bank shall makes the payment of the bill after deducting some interest (called discount in this case). This process of encashing the bill with the bank is called discounting the bill. The bank gets the amount from the drawee on the due date.

Any holder may transfer a bill unless its transfer is restricted, i.e. the bill has been negotiated containing words prohibiting its transfer. The bill can be initially endorsed by the drawer by putting his signatures at the back of the