Negotiable Instruments Act Section 10 — “Payment in due course”

CHAPTER II OF NOTES, BILLSAND CHEQUES

General

Summary

Payment in due course means paying the amount written on a cheque or other negotiable instrument exactly as it appears, in good faith and without carelessness, to the person who holds the instrument. This applies when there is no reasonable reason to suspect that the holder is not entitled to receive the payment.

Official Text

“Payment in due course” means payment in accordance with the apparent tenor of the instrument in good faith and without negligence to any person in possession thereof under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of the amount therein mentioned.