Q.Define a Promissory Note. State any two of its essential elements.

A promissory note is the simplest negotiable instrument — a two-party written promise to pay, defined by Section 4 of the Negotiable Instruments Act, 1881.

Section 4 also requires the sum to be certain, payable only in money, and the promise itself to be unconditional.

Definition (Section 4, Negotiable Instruments Act, 1881): A promissory note is an instrument in writing (not being a bank-note or currency-note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.

Essential elements (any two, illustrative of the full set):

1. It must be in writing.
2. It must contain an unconditional undertaking (promise) to pay — not merely a statement acknowledging that money is owed.
3. It must be signed by the maker.
4. The sum payable must be certain.
5. Payment must be only in money.
6. The payee must be a certain person — it cannot be made payable to bearer on demand.

Students often describe a promissory note as an 'order' to pay — that is a bill of exchange. A promissory note is always a PROMISE (made by the debtor/maker themselves), never an order directed at a third party.