Which of the following is/are true about Bill of Exchange? 1. A bill of exchange requires in its inception two parties. 2. A bill of exchange or ‘draft’ is a written order by the drawer to the drawee to pay money to the payee. 3. Bills of exchange are used primarily in international trade, and are written orders by one person to his bank to pay the bearer a specific sum on a specific date. 4. Definition of ‘Bill of Exchange’ is mentioned in Section 6 of the Negotiable Instrument Act.

The correct answer is: B. 1, 2 and 4

A bill of exchange is a written order by the drawer to the drawee to pay money to the payee. It is a negotiable instrument, which means that it can be transferred from one person to another by endorsement. Bills of exchange are used primarily in international trade, but they can also be used in domestic transactions.

The definition of a bill of exchange is mentioned in Section 6 of the Negotiable Instruments Act, 1881. It states that a bill of exchange is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money to or to the order of a certain person or to bearer, on demand or at a fixed or determinable future time.

Option 1 is true because a bill of exchange requires two parties: the drawer and the drawee. The drawer is the person who creates the bill of exchange and orders the drawee to pay the money. The drawee is the person who is ordered to pay the money.

Option 2 is true because a bill of exchange is a written order by the drawer to the drawee to pay money to the payee.

Option 3 is false

because bills of exchange are not used primarily in international trade. They can be used in both international and domestic transactions.

Option 4 is true because the definition of a bill of exchange is mentioned in Section 6 of the Negotiable Instruments Act, 1881.