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Mourya K
in Contracts Law Commercial Law
Asked October 07, 2017

Legality of Promissory Note

  • 1 Answer
  • 76 Views

My mother gave 2 Lakh rupees to my cousin brother with 2 rupees interest by writing on Promisory note. He died 40 days back and he is having some assets on his name. I asked his wife to rewrite the notes. But, she is denying to rewrite the notes and saying that I'm not responsible for your debts. Please advice me in these 4 questions. 1. Is Promisory notes are legal in India that too with 2 rupees interest? 2. Am I eligible to go to court because it's been 40 days of his death and if eligible, how many days? 3. How much it costs to file a case and how many days it lasts? 4. I am preparing for Civil Services, Does this case affect me in future? Thank You..

Answer 1

The answers to your questions are as follows:

  • Promissory notes are valid under the Negotiable Instruments Act, 1881. The Act does not prescribe any minimum interest rate.
  • This question depends on the terms of the promissory note. Is the promissory note payable at a certain date? If not, then under Section 19 of the Act, it is payable on demand. Please note that in the case of Framroz Eduljee Dinshaw v. Mahomed Essa (AIR 1926 Bom 241), the Bombay High Court noted that in case of a promissory note payable on demand, the period of limitation for filing a suit begins from the date of the promissory note, so a demand is not necessary before filing a suit. Thus, a case must be filed within 3 years from the date on which the loan was given.
  • This can only be answered by the lawyer you choose to represent you in court.
  • The answer to this question depends on who the payee is in the promissory note. Since it appears that it your mother who has lent the amounts, she should be the one filing the case if the amounts are not paid.
  • Agree Comment 0 Agrees 6 months ago

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