Pro-note means a Promissory Note as per Negotiable Instrument Act. Section 4 of the Negotiable Instrument Act, 1881 defines a promissory note as an instrument in writing (not being a bank note or a currency note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to or to the order of a certain person or to the bearer of the instrument
- The Promissory Note has to be
written, duly signed by the maker.
Sample of Pro-note for concept
- It should be properly stamped as per Indian Stamp Act.
- It must make a promise to pay and not an acknowledgement of indebtedness.
- The amount payable must be certain.
- It can be endorsed to a third party
- Acceptance is not essential
The Parties to Pro Note are :
- The maker or Drawer : The person who makes the note and promises to pay the amount stated there in.
- The Payee – The person to whom the amount is payable.
In case of the transfer of Promissory Note by payee to others, payee becomes the Endorser.
- The Endorser :- The person who endorses the note in favour of another person
- The Endorsee – The person in whose favour the note is negotiated by endorsement.
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