Law of Banking and Negotiable Instruments
Maharashtra National Law University, Aurangabad · LL.B. Semester 9
Unit I — History and Evolution of Banking Sector in India
History and Development of Banking Sector, Nationalisation of Banks and its Impact Present Structure of Commercial Banks and their functions Banker and Customer, Special Types of Customers Relationship between banker and customer, General Relationship, Special Relationship, Duties and Rights, Customer Protection (Banking Ombudsman Scheme), Role of Banks in Economic Development of Nation, Emerging trends in banking Sector, E-Banking, E- wallets, ATMS, Debit and Credit Cards.
Unit II — Regulatory Framework of Banks
(a) The Reserve Bank of India Act, Establishment and Incorporation of RBI, Powers and Functions of RBI, Regulatory Restrictions on Lending. (b)The Banking (Regulation) Act, 1949 Definition of Bank, Banker, Banking and Banking Companies, Restriction on Advances, Paid up capital and Reserve, Narasimhan Committee Report.
Unit III — Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970
Banks Nationalization Act
Unit IV — The Recovery of Debts Due to Banks and Financial Institutions Act, 1993 &
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 200. The Recovery of Debts Due to Banks and Financial Institutions Act, 1993, Aims, Object, purpose and Scope of RDB Act., Establishment of DRT (Debt Recovery Tribunal), Powers and procedures of DRT, Enforcement process and Meaning of ‘Debt’, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (The Act empowers the banks and financial institutions to recover their dues in Non-Performing Assets accounts, without the intervention of a court, Objective of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, Constitutional Validity Of the Act., Concept of Securitisation and reconstruction company.
Unit V — Introduction of Negotiable Instruments Act, 1881.
History and nature of Negotiable Instruments, Different kinds of Negotiable Instruments viz., Promissory Note, Bill of Exchange & Cheque Definition and Nature, Meaning of ‘Holder’ and ‘Holder in Due Course Rights & privileges of holder in due course.
Unit VI — Transfer of Negotiable Instruments
Meaning and effect of Negotiation, Assignment, Meaning and effect of Negotiable Instruments -Who may endorse? Kinds of Endorsement – Endorsement in Blank and Full, Conditional Endorsement, Restrictive Endorsement, Sans Recourse Endorsement, Partial Endorsement.
Unit VII — Liability of Parties and Discharge from Liability
Liability of accepter or Maker, Drawer, Drawee and Endorser, Banker’s liabilities for Unjustified dishonor of cheque, Discharge from liability by Cancellation, by Release, by Payment, by Material Alteration, by qualified acceptance by Negotiation, Criminal Liability of drawer for issuing cheques without fund, prosecution of drawer; fine and composition; compounding of offence; Cognizance of offences and Jurisdiction; summary trial and sentence.
Unit VIII — Crossing of Cheques
Meaning, Object and consequences of crossing, Different Kinds of crossing - general, special, not-negotiable & account payee, crossing, who may Cross? Rights and duties of paying banker, Protection of collecting banker.