Which of the following phrases defines the nature of the 'Hundi' generally referred to in the sources of the post-Harsha period ?
- (a) An advisory issued by the king to his subordinates
- (b) A diary to be maintained for daily accounts
- (c) A bill of exchange ✓ UPSC's answer
- (d) An order from the feudal lord to his subordinates
Why the answer is (c)
• A hundi was an indigenous bill of exchange — a written order by which merchants transferred money or credit across distances without carrying cash — option (c).
• Hundis appear in post-Harsha sources and flourished under the Delhi Sultanate and Mughals, when sarrafs (bankers) discounted and honoured them in different cities.
• They financed long-distance trade and even remitted State revenue; the Negotiable Instruments Act, 1881 still recognises them.
• It was not a royal advisory (a), an account diary (b) or a feudal order (d).
• Hence option (c).
Why the other options are wrong
- (a) An advisory issued by the king to his subordinates
- A hundi is a financial instrument, not a royal advisory.
- (b) A diary to be maintained for daily accounts
- It is not an account book.
- (d) An order from the feudal lord to his subordinates
- It is not a feudal order.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2020, held on 4 October 2020. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.