Report No. 11
42. Section 5, para 1.-
The words "on demand or at a fixed or determinable future time" have similarly been added to the definition of "bill of exchange" contained in the first paragraph of section 5, for, the existing provision is silent as to the time of payment of a bill of exchange though a cheque is defined as a bill of exchange "not expressed to be payable otherwise than on demand." The English and American provisions do not leave it to inference and we prefer to follow these precedents.
Some of the Chambers of Commerce suggested that sub-section (4) of section 3 of the Bills of Exchange Act should be adopted and a provision should be made that an instrument, which is not dated or in which the value or the place where it is drawn or payable are not mentioned, should be valid. We do not consider it useful to give effect to this suggestion, having regard to the conditions prevalent in India. The date is important in several respects and there is a presumption under section 118 in favour of execution on the date given in an instrument. Apart from this it can hardly be overlooked that, notwithstanding section 3(4)(a) of the Bills of Exchange Act, in practice1 no undated cheque is paid by a banker in England and such practice has recently been judicially noticed.2 It would not be advisable therefore, to incorporate an express provision to the effect that dating is not necessary to give validity to the instrument.
1. Byles on Bills of Exchange, 21st Edn., p. 13.
2. Griffiths v. Dalton, (1940) 2 KBN 264.
On the other hand, there is no need to include similar statements relating to the payment of consideration or the place of execution or that for payment, for, the definitions in our Act relating to the several instruments do not require these matters to be in stated in any of the instruments. On the contrary, so far as consideration is concerned there is, in section 118(a), a presumption in favour of its payment as regards every negotiable instrument.