Section 25 NI Act: When day of maturity is a holiday
Negotiable Instruments Act, 1881
Section 25 NI Act at a Glance
Section 25 NI Act states that when the maturity date of a promissory note or bill of exchange falls on a public holiday, including a Sunday, the instrument is deemed due on the next preceding business day.
Section 25 NI Act Bare Act Text
25. When day of maturity is a holiday.
When the day on which a promissory note or bill of exchange is at maturity is a public holiday, the instrument shall be deemed to be due on the next preceding, business day.
Explanation.—The expression “public holiday” includes Sundays: *** and any other day declared by the Central Government, by notification in the Official Gazette, to be a public holiday.
Amendments to this section
- The words "New Year's day, Christmas day: if either of such days falls on a Sunday, the next following Monday: Good-Friday:" omitted by Act 37 of 1955, s. 3 (w.e.f. 1-4-1956).
- Subs. by the A.O. 1937, for "L.G.".
Section 25 NI Act in Simple Words
Section 25 NI Act sets the rule for when the maturity date of a promissory note or bill of exchange falls on a public holiday. In that situation, the promissory note or bill of exchange is deemed to be due on the next preceding business day.
The Explanation to Section 25 NI Act clarifies the meaning of the expression "public holiday". It states that "public holiday" includes Sundays and any other day declared by the Central Government, by notification in the Official Gazette, to be a public holiday.
Act 37 of 1955 omitted the words "New Year's day, Christmas day: if either of such days falls on a Sunday, the next following Monday: Good-Friday:" from 1 April 1956. The Government of India (Adaptation of Indian Laws) Order, 1937 put "Central Government" in place of "L.G.".
When Section 25 NI Act Applies
- A promissory note or bill of exchange reaches the day on which it is at maturity.
- That day of maturity is a public holiday, which includes Sundays and any other day declared by the Central Government by notification in the Official Gazette to be a public holiday.
- The instrument is deemed to be due on the next preceding business day.
Example of Section 25 NI Act
FAQs on Section 25 NI Act
What is Section 25 NI Act?▼
Section 25 NI Act provides the rule when the day of maturity of a promissory note or bill of exchange falls on a public holiday. Section 25 NI Act states that the instrument is deemed to be due on the next preceding business day.
If a promissory note matures on a public holiday, is it due on the day before or the day after under Section 25 NI Act?▼
On the business day before. Section 25 NI Act states that when the day of maturity is a public holiday, the instrument is deemed to be due on the next preceding business day.
Does a public holiday under Section 25 NI Act include Sundays?▼
Yes. The Explanation to Section 25 NI Act states that the expression "public holiday" includes Sundays.
Who can declare additional days to be public holidays under Section 25 NI Act?▼
The Central Government. Under the Explanation to Section 25 NI Act, "public holiday" includes any other day declared by the Central Government, by notification in the Official Gazette, to be a public holiday.
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Sources: Bare Act Text, Negotiable Instruments Act, 1881 (India Code) ·