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What is difference between drawee and drawer?
Drawer is the authorized person to make the note, check, bills of exchange etc. He is also known as maker of instrument(note,boe,check). Drawee is the person who makes the payment for the bill or instrument written.
What is drawee?
drawee is a person in whose favor a bill is drawn.
Need a sample of bill of exchange?
bill of exchange
What is the difference between bill of entry and bill of exchange?
A bill of exchange is one person pays a certain amount for goods and services on a specific day. A bill of entry is the exact value of good that have been shipped out or come in.
Definition of bill of exchange?
A document acknowledging giving or selling something.
State the similarities between a cheque and bill of exchange?
Both of them are forms of payment. Both promise the receiver that they will receive money. There are three parties in both, the payee, the drawer, and the drawee.
Can a drawee to a bill of exchange be the payee?
No,drawee is the person upon whom the bill the exchange is drawn. in general debtor is the drawee.drawer is the peson who sold the goods on credit. drawer make the bill of exchange upon the debtor.payee is the peson to whom the drawee make the payment according to the condition mention in the bill.drawer and payee may be the same person or different if the has been endorse to the creditor or discounted from the bank.___________________________________________________________________BILLS OF EXCHANGE IS AN INSTRUMENT IN WRITING,CONTAINING AN UNCODITIONAL ORDER,SIGN BY THE MAKER/DRAWER,DIRECTIONG A PERSON TO PAY A CERTAIN AMOUNT OF MONEY ONLY TO , OR TO THE ORDER OF A CERTAIN PERSON OR THE BEARER OF THE INSTRUMENT.IT IS GENERALLY DRAWN UPON A DEBTOR BY THE CREDITOR.THE DEBTOR HAS TO PAY THYE MONEY AFTER A FIXED DURATION OF TIME ONLY WHICH IS KNOWN AS MATURITY OF BILL.THREE PARTIES ARE INVOLVE IN THISONE IS THE DRAWER OR THE MAKER/SELLER OF THE BILL OF EXCHANGE WHO DRAW THE BILO UPON HIS DEBTOR.SECOND IS THE DRAWEE OR DEBTOR/PURCHASER UPON WHOM THE BILL OF EXCHANGE IS DRAWN.THIRD THE PAYEE THE PERSON TO WHOM THE PAYMENT HAS TO BE MADE.IF THE DRAWER KEEP THE BILL TILL THE MATURITY AND RECEIVE THE PAYMENT FROM THE DRAWEE HE HIMSELF IS THE PAYEE.PAYEE AND DRAWER ARE DIFFERENT IF1 THE DRAWER DISCOUNT THE BILL FROM HIS BANK(MEANS THAT IF THE BELL HAS BEEN DRAWN FOR THREE MONTHS AND THE DRAWER NEED THE MONEY IN BETWEEN HE MAY ENCASH THE BILL FROM THE BANK. BANK AFTER DEDUCTING SOME INTEREST GIVE THE REMAING AMOUNT TO THE DRAWER) OR2 DRAWER TRANSFER THE BILL TO HIS CREDITOR WHICH IS KNOWN AS ENDORSMENT OF BILL.IN CASE OF ANY OR BOTH OF THE ABOVE CONDITION THE PAYEE AND THE DRAWER ARE DIFFERNT EITHER THE BANK OR CREDITOR TO WHOM THE DRAWEE HAS TO MAKE THE PAYEMENT
What is difference between drawee and drawer?
Drawer is the authorized person to make the note, check, bills of exchange etc. He is also known as maker of instrument(note,boe,check). Drawee is the person who makes the payment for the bill or instrument written.
Meaning of fictitious bill?
A bill in which the drawer or the payee or both are non existent. In such case the drawee or the acceptor is liable to pay the due amount to the holder in due course. The onus to prove that the drawer is fake lies on the endorsee. He can prove it by proving that the signature of drawer and first endorser are the same.
Explain characteristics of bill of exchange?
Bill of exchange A bill of exchange or "draft" is a written order by the drawer to the drawee to pay money to the payee. A common type of bill of exchange is the cheque, defined as a bill of exchange drawn on a banker and payable on demand. Bills of exchange are used primarily in international trade, and are written orders by one person to his bank to pay the bearer a specific sum on a specific date. Prior to the advent of paper currency, bills of exchange were a common means of exchange. They are not used as often today. A bill of exchange is an unconditional order in writing addressed by one person to another, signed by the person giving it, requiring the person to whom it is addressed to pay on demand or at fixed or determinable future time a sum certain in money to order or to bearer. It is essentially an order made by one person to another to pay money to a third person. A bill of exchange requires in its inception three parties-the drawer, the drawee, and the payee. The person who draws the bill is called the drawer. He gives the order to pay money to third party. The party upon whom the bill is drawn is called the drawee. He is the person to whom the bill is addressed and who is ordered to pay. He becomes an acceptor when he indicates his willingness to pay the bill.The party in whose favor the bill is drawn or is payable is called the payee. The parties need not all be distinct persons. Thus, the drawer may draw on himself payable to his own order. A bill of exchange may be endorsed by the payee in favour of a third party, who may in turn endorse it to a fourth, and so on indefinitely. The "holder in due course" may claim the amount of the bill against the drawee and all previous endorsers, regardless of any counterclaims that may have disabled the previous payee or endorser from doing so. This is what is meant by saying that a bill is negotiable. In some cases a bill is marked "not negotiable". In that case it can still be transferred to a third party, but the third party can have no better right than the transferor
What do you understand by dishonour of bill of exchange?
DISHONOUR OF THE BILL OF EXCHANGEWhen the Bill of exchange is not accepted by the drawee, or payment is not made against the bill by the drawee, the bill is is said to be dishonoured. A Bill is dishonoured in the following two conditions:1-DISHONOUR BY NON-ACCEPTANCEIf the Drawee refuses to accept the bill, it is known as Dishonour of the bill of exchange by non-acceptance.2-DISHONOUR BY NON-PAYMENTIf the drawee doesn't pay a certain amount of money when the bill is shown on maturity, the bill gets dishonoured due to Non-payment.
What is 'Noting Charge'?
It is the amount paid by the drawer of the bill to the notary of a particular area who then warns the drawee of the bill to honour it in a specified time period.
When bill must be accepted?
ACCEPTANCE. This word is commonly used as meaning a bill of exchange, that is, the actual bill itself, but an acceptance is really the writing across the face of a bill by which the drawee agrees to the order of the drawer. The drawee is the person to whom a bill is addressed by the drawer, and who is required to pay on demand, or at a fixed or determinable future time, a sum certain in money to or to the order of a specified person, or to bearer. If the drawee agrees to the drawer's order he signifies his assent by accepting the bill. When the drawee has accepted a bill he is called the acceptor. An acceptance is defined by Section 17 of the Bills of Exchange Act, 1882, as follows : " (1) The acceptance of a bill is the signi fication by the drawee of his assent to the order of the drawer. " (2) An acceptance is invalid unless it complies with the following con ditions, namely : " (a) It must be written on the bill and be signed by the drawee. The mere signature of the drawee without additional words is sufficient. " (b) It must not express that the drawee will perform his promise by any other means than the payment of money." As a rule a drawee accepts a bill after it has been fully completed and signed by the drawer ; but by Section IS, " A bill may be accepted : " (I) Before it has been signed by the drawer, or while otherwise incom plete : " (2) When it is overdue, or after it has been dishonoured by a previous refusal to accept, or by non payment : " (3) When a bill payable after sight is dishonoured by non-acceptance, and the drawee subsequently accepts it, the holder, in the absence of any different agreement, is entitled to have the bill accepted as of the date of first presentment to the drawee for acceptance." There are two kinds of acceptances : (1) General acceptance. (See ACCEPT ANCE, GENERAL.) (2) Qualified acceptance. (See ACCEPT ANCE, QUALIFIED.) " A general acceptance assents without qualification to the order of the drawer. A qualified acceptance in express terms varies the effect of the bill as drawn." (Section 19, s.s. 2.) An acceptance is usually upon the face of the bill, but the drawee's signature placed upon the back of it is regarded as sufficient. In such a case it is usual to make a reference on the front of the bill to the fact that the acceptance is on the back. A drawee may accept a bill by merely writing his name across it, without any further words, but it is customary for the word " accepted " to be used. When the bill is domiciled, .the name of the bank where it is payable follows the word " accepted," and then the acceptor signs his name. The commonest form of acceptance (a general acceptance) is :- " Accepted. payable at the X & V Bank ing Coy., Ltd., London, John Brown." If the bill is payable at so many days after sight, the drawee must add the date of sight ing to his acceptance. (See SIGHTING A BILL.) If there are several drawees named on a bill, each one of them must sign the accept ance, but an order addressed to two drawees in the alternative, or to two or more drawees in succession, is not a bill of exchange. (See DRAWEE.) Section 17 states that the acceptance must be signed by the drawee, but anyone who holds a proper authority from the drawee to accept bills may accept on his behalf. Where the drawee is a firm, the partner who accepts must do so in the name of the firm. If the drawee is Mrs. John Brown, she should accept as " Mary Brown, wife (or widow) of John Brown." Where the drawee is a limited company, the acceptance should, to be correct, contain the name of the company as well as the signatures of the authorised officials. With regard to the rules as to presentment of a bill for acceptance, see PRESENTMENT FOR ACCEPTANCE. When a bill is duly presented for accept ance and is not accepted within the cus tomary time, the person presenting it must treat it as dishonoured by non-acceptance.
Difference Between Bills Of Exchange And A check?
The following are the main differences between a cheque and a bill of excyange.A cheque is always drawn on a banker, whereas a bill of exchange can be drawn on any person including a banker.A cheque is always payable on demand, whereas a bill of exchange is either payable on demand or after a fixed period.Payment of a cheque can be countermanded, whereas the payment of a bill of exchange cannot be counter mended.A cheque can be made payable to a bearer, but a bill of exchange can be made payable only to order.A cheque is a means of payment. But a bill of exchange is usually used for financing a trade.In a cheque, the drawer of the cheque is primarily responsible, but in a bill of exchange, the drawee or acceptor is primarily responsible for payment.When a cheque is dishonoured, noting and protesting is not necessary/required. But when a bill of exchange is dishonoured, noting and protesting is necessary.When a cheque is dishonoured, the holder of the cheque need not give notice of dishonour to the drawer to make him liable on the cheque. But on the other hand, when a bill of exchange is dishonoured, notice of dishonour is to be given to all parties, including the drawer to make them liable on the instrument.A cheque can be crossed, but a bill of exchange needs no crossing.M. J. SUBRAMANYAM, BANGALORE
Explain the essential elements of bills of exchange?
Essential of Bill of Exchange 1. The bill must be an unconditional order. 2. It must be in writing. 3. It must be signed by the maker. 4. The drawer must be a certain person. 5. The drawee must be certain. 6. The payee must be certain person. 7. The amount payable in the bill must be certain. 8. The order must be to pay money and money only. 9. The amount must be payable on demand or a fixed or determinable time. 10. It must be stamped according to the value of the bill.
What is the difference between bill and debt?
Bills are of two types : Bills receivable and Bills payble.....Bill payable is a liability...A bill is drawn by the drawer and the person who has to borne the liability is called the payee or drawee.....Bill can be termly...for e.g. The drawer draws a bill upon the drawee for 3 months..or T months etc.. Now debts arise when a person is obliged to someone...Mostly debt arises in trading transactions...e.g. A trader purchases goods from a seller and promises him to pay certain amount after some time...Thus it is a credit purchase ...here the trader is in a position of debt...... Now considering the same position the seller will draw a BILL upon the TRADER who is in DEBT or indebted.
What is a drawee?
drawee is a person in whose favor a bill is drawn.
