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The Negotiable Instruments Act (NIA) is the primary legislation governing negotiable instruments in India. It was enacted in 1881 and has been amended several times since then. The NIA lays down the timelines for various aspects of negotiable instruments, such as:
- Negotiation: A negotiable instrument can be negotiated within six months of its date of issue or within such longer period as may be specified in the instrument itself.
- Presentment: A negotiable instrument must be presented for payment within a reasonable time after its date of issue or within such shorter or longer period as may be specified in the instrument itself.
- Dishonor: A negotiable instrument is dishonored if it is not paid on presentation. The dishonor of a negotiable instrument must be communicated to the drawer and the indorsers within a reasonable time after the date of dishonor.
- Notice of dishonor: The notice of dishonor must be given in writing and must state the date of dishonor and the reason for dishonor. The notice of dishonor must be sent to the drawer and the indorsers by registered post or by any other means that is reasonably likely to bring the notice to their attention.
- Filing of a complaint: A complaint under Section 138 of the NIA must be filed within 30 days of receiving the cheque bounce memo from the bank.
It is important to note that these are just the general timelines prescribed by the NIA. There may be specific timelines for certain types of negotiable instruments or for certain situations. For example, the timeline for presentment of a bill of exchange is different from the timeline for presentment of a cheque.
