Page 3 - LESSON NOTE

Reserve Bank of India Act, a promissory note payable to bearer is illegal.
Therefore, a promissory note cannot be made payable to the bearer.’

Parties to a Promissory Note

There Are Two Parties to a Promissory Note:

(1) Maker OR Drawer:

 Maker is the person who makes or draws the promissory note.
 Who promises to pay a certain sum as specified in the promissory
note.

 He is also called the ‘Promisor’.
(2) Payee:

The payee is the person in whose favour the promissory note is drawn.

The above mentioned is the concept, that is elucidated in detail about ‘Bill
of Exchange’ for the Commerce students.

Distinction between Bills of Exchange and Promissory Note

S. Basis of Bills of Exchange Promissory Note
No. difference

1. Drawer The Drawer is the creditor. The Drawer is the debtor

It has three parties namely It has two parties namely:
· The drawer
2. No. of Parties · The Maker
· The drawee · The Payee
· The Payee

Order or It contains a promise to make the
3. It contains an order to make the payment.
Promise payment