Q1: 1. In the context of negotiable instruments, what does Section 47 of the Negotiable Instruments Act 1881 deal with?

• A) A) Endorsement
• B) B) Delivery
• C) C) Acceptance
• D) D) Promissory note

Q2: 2. When can a negotiable instrument be negotiated by delivery under Section 47 of the Act?

• A) A) Only when endorsed
• B) B) Only when accepted by the drawee
• C) C) When it is made payable to bearer
• D) D) When it is overdue

Q3: 3. Which of the following is NOT a requirement for negotiation by delivery under Section 47?

• A) A) Instrument must be payable to bearer
• B) B) Instrument must be duly stamped
• C) C) The delivery must be made by the holder of the instrument
• D) D) The delivery must be unconditional

Q4: 4. In a real-life scenario, if a cheque is made payable to "Cash," how can it be negotiated?

• A) A) By endorsement only
• B) B) By delivery only
• C) C) By endorsement or delivery
• D) D) It cannot be negotiated

Q5: 5. What happens if a negotiable instrument payable to bearer is lost and found by someone else who then negotiates it by delivery?

• A) A) The negotiation is invalid
• B) B) The negotiation is valid
• C) C) The instrument becomes non-negotiable
• D) D) The instrument is cancelled

Q6: 6. Under Section 47, who can negotiate a bearer instrument by delivery?

• A) A) The payee only
• B) B) Any person in possession of the instrument
• C) C) The drawee
• D) D) The endorser

Q7: 7. Which of the following is a type of negotiable instrument that can be negotiated by delivery?

• A) A) Order cheque
• B) B) Bill of exchange
• C) C) Promissory note
• D) D) All of the above

Q8: 8. If a promissory note payable to bearer is transferred by mere delivery, who becomes the holder of the instrument?

• A) A) Original payee
• B) B) Endorser
• C) C) New possessor
• D) D) Drawee

Q9: 9. What is the significance of negotiation by delivery in the context of negotiable instruments?

• A) A) Simplifies the process of transferring ownership
• B) B) Requires additional documentation
• C) C) Makes the instrument non-negotiable
• D) D) Invalidates the instrument

Q10: 10. If a bearer instrument is delivered as security for a loan, who holds the rights to negotiate the instrument?

• A) A) Lender
• B) B) Borrower
• C) C) Both lender and borrower
• D) D) Neither lender nor borrower

Q11: 11. In a scenario where a bearer instrument is stolen and then negotiated by delivery, who bears the risk of loss?

• A) A) Original payee
• B) B) Thief
• C) C) New holder
• D) D) Drawee

Q12: 12. Can a promissory note made payable to bearer be negotiated by mere delivery even if it contains an express prohibition against transfer?

• A) A) Yes
• B) B) No
• C) C) Only with court approval
• D) D) Only with a witness

Q13: 13. In case of negotiation by delivery, what must the possessor of the instrument ensure before transferring it to another party?

• A) A) Endorsement by the previous holder
• B) B) Authentication by a notary
• C) C) Adequate stamp duty
• D) D) Proper delivery with intent to transfer ownership

Q14: 14. If a bearer instrument is accidentally destroyed before being negotiated by delivery, what is the legal consequence?

• A) A) Instrument becomes non-negotiable
• B) B) Holder loses all rights
• C) C) New instrument must be issued
• D) D) Previous negotiations are still valid

Q15: 15. Can a bearer instrument be negotiated by delivery through electronic means or digitally?

• A) A) Yes
• B) B) No
• C) C) Only with prior approval
• D) D) Only if physically delivered

Q16: 16. In a situation where a bearer instrument is delivered as a gift, who becomes the rightful holder?

• A) A) Giver
• B) B) Receiver
• C) C) Both giver and receiver
• D) D) Neither giver nor receiver

Q17: 17. What legal protection does Section 47 provide regarding negotiation by delivery?

• A) A) Rights of the holder in due course
• B) B) Rights of the original payee
• C) C) Rights of the drawee
• D) D) Rights of the endorser

Q18: 18. If a bearer instrument is lost and then found by a third party who negotiates it by delivery, what rights does the original owner retain?

• A) A) Full ownership rights
• B) B) No rights
• C) C) Partial rights
• D) D) Rights to claim the instrument

Q19: 19. In a case of negotiation by delivery, what happens if the possessor of the instrument refuses to transfer it to another party?

• A) A) Negotiation is still valid
• B) B) Negotiation is invalidated
• C) C) Instrument becomes void
• D) D) Possessor loses rights

Q20: 20. If a bearer instrument is accidentally delivered to the wrong person, who holds the negotiation rights?

• A) A) Intended recipient
• B) B) Unintended recipient
• C) C) Both parties
• D) D) Neither party

Q21: 21. Can negotiation by delivery take place if the bearer instrument is damaged or defaced?

• A) A) Yes
• B) B) No
• C) C) Only with permission from the bank
• D) D) Only with court order

Q22: 22. In a scenario where a bearer instrument is delivered to a minor who then negotiates it by delivery, what is the legal implication?

• A) A) Negotiation is valid
• B) B) Negotiation is invalid
• C) C) Requires guardian's approval
• D) D) Minor loses rights

Q23: 23. What precautions should a person take before negotiating a bearer instrument by delivery to ensure the transfer is legally binding?

• A) A) Obtain notarized certificate
• B) B) Verify identity of recipient
• C) C) Record delivery in writing
• D) D) Inform the bank

Q24: 24. If a bearer instrument is mistakenly delivered to a fraudster who then negotiates it by delivery, who bears the liability?

• A) A) Original possessor
• B) B) Fraudster
• C) C) New holder
• D) D) Drawee

Q25: 25. What key aspect distinguishes negotiation by delivery from negotiation by endorsement?

• A) A) Involvement of third party
• B) B) Mode of transfer
• C) C) Legal validity
• D) D) Time frame