Section 22 NI Act: "Maturity"

Negotiable Instruments Act, 1881

Section 22 NI Act at a Glance

Section 22 NI Act defines maturity as the date a promissory note or bill of exchange falls due. Unless expressed to be payable on demand, at sight, or on presentment, it matures on the 3rd day after the day expressed for payment.

Section 22 NI Act Bare Act Text

22. "Maturity".
The maturity of a promissory note or bill of exchange is the date at which it falls due.
Days of grace.—Every promissory note or bill of exchange which is not expressed to be payable on demand, at sight or on presentment is at maturity on the third day after the day on which it is expressed to be payable.

Section 22 NI Act in Simple Words

Section 22 NI Act defines the 'maturity' of a promissory note or a bill of exchange and provides the rule for 'days of grace'. Under the first paragraph of Section 22 NI Act, the maturity of a promissory note or a bill of exchange is the date at which the instrument falls due.

Under the second paragraph of Section 22 NI Act, every promissory note or bill of exchange that is not expressed to be payable on demand, at sight, or on presentment reaches maturity on the 3rd day after the day on which the instrument is expressed to be payable. Those 3 additional days are called 'days of grace'.

If a promissory note or bill of exchange is expressed to be payable on demand, at sight, or on presentment, the 3 days of grace under Section 22 NI Act do not apply.

When Section 22 NI Act Applies

The maturity of a promissory note or a bill of exchange is the date at which the instrument falls due.
The instrument must be a promissory note or a bill of exchange that is not expressed to be payable on demand, at sight, or on presentment.
Such a promissory note or bill of exchange is at maturity on the 3rd day after the day on which it is expressed to be payable (3 days of grace).

Example of Section 22 NI Act

Iqbal in Visakhapatnam executes a promissory note promising to pay ₹75,000 to Raghav on 10 March. Because the promissory note is expressed to be payable on a specified day and is not expressed to be payable on demand, at sight, or on presentment, the 3 days of grace under Section 22 NI Act apply. Under Section 22 NI Act, the promissory note reaches maturity on the 3rd day after 10 March, which is 13 March. Therefore, 13 March is the date at which the promissory note falls due.

FAQs on Section 22 NI Act

What is Section 22 NI Act?▼

Section 22 NI Act defines the maturity of a promissory note or bill of exchange as the date at which the instrument falls due. It also grants 3 days of grace, so every promissory note or bill of exchange not expressed to be payable on demand, at sight, or on presentment reaches maturity on the 3rd day after the day on which it is expressed to be payable.

How many days of grace are allowed under Section 22 NI Act?▼

3 days. Under Section 22 NI Act, an eligible promissory note or bill of exchange is at maturity on the 3rd day after the day on which the instrument is expressed to be payable.

Do the 3 days of grace under Section 22 NI Act apply to instruments expressed to be payable on demand, at sight, or on presentment?▼

No. Section 22 NI Act gives the 3 days of grace only to a promissory note or bill of exchange that is not expressed to be payable on demand, at sight, or on presentment.

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Disclaimer: This is for informational purposes only. Always consult a qualified advocate for legal advice.

Sources: Bare Act Text, Negotiable Instruments Act, 1881 (India Code) ·