Under Section 9 of the Negotiable Instruments Act, which condition must be fulfilled for a person to qualify as a Holder in Due Course?
Answer and explanation
Correct answer: D. He acquired the instrument for consideration, before maturity, and in good faith without defect of title
- Step 1: Refer to Section 9 of the Negotiable Instruments Act 1881.
- Step 2: A Holder in Due Course (HDC) is a person who for consideration becomes the possessor of a negotiable instrument.
- Step 3: The acquisition must be before the instrument became overdue and without sufficient cause to believe that any defect existed in the title of the person from whom he derived it.
Answer
He acquired the instrument for consideration, before maturity, and in good faith without defect of title.
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