Essential elements of promissory note

A promissory note contains several elements that separate it from other negotiable financial instruments. The following are a few such distinct elements:

• Written notes:A promissory note should always be in written form. It can never exist as an oral contractual promise to pay money. This can be taken as most appropriate legal as well as a customary requirement for financial instruments.
• Express undertaking:The undertaking is the element for forming the base of a promissory note and must be expressive enough. Thus, inferring an acknowledgement or a note to pay and calling it a promissory note would not be enough. For example, writing “I owe X Rs. 5000” does not amount to such notes. They have to be expressive enough.
• Unconditional promise:The promise for paying a specific amount of money should be unconditional for all cases. Thus, a conditional promise can never form the basis for such promissory notes. For instance, one cannot promise of paying the amount only if he has it, as it amounts to a condition. Moreover, promising to pay on a particular is fine. For example, one can promise to pay other, 3 months from the date of the note’s execution.
• Specific amount:Promissory note must include a specific amount. There can be no additions or subtractions to them.
• Legal tender:The amount payable under a promissory note should always be expressible in legal tenders in terms of Rupees or Dollars.