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JAIIB PPB Unit 27 — Documentation: Free MCQs with Explanations

By Swarnakshi Jha (ex-banker) · Updated 20 September 2026 · Paper 2 of the November 2026 cycle (22 November 2026)

This page is a free slice of our JAIIB PPB question bank for Unit 27 — Documentation (Module B — Functions of Banks). The Mock Centre holds 59 questions on this unit alone, every one with a why-right / why-wrong explanation; below are the facts examiners keep returning to, five of those questions to try, and the traps that cost marks.

PPB · Module B59 MCQs in the Mock Centre5 free belowPaper on 22 November 2026

Key facts examiners test from this unit

  1. Documents = the legal-remedy basis; four types — DPN, agreements, forms, guarantees; minor's loan documents unenforceable.
  2. DPN: Sec. 4 NI Act form, UNIFORM stamp duty, filled + stamped BEFORE signature, never witnessed (attested DPN ≠ bond per case law); taken for demand facilities.
  3. Stamping: Sec. 17 (before/at execution), Sec. 18 (foreign documents — 3 months), Sec. 19 (first Indian holder stamps foreign bills/notes), Sec. 12 (cancel adhesive stamps), Sec. 35 (inadmissible till duty + 10× penalty; PNs/BoEs incurable).

5 free practice questions — tap an option

Five basic questions from this unit. Answers lock on the first tap, exactly as in the exam, and a short explanation opens underneath. The Mock Centre adds the moderate and tough questions, why every other option is wrong, the concept capsule and the exam tip — with your score and revision dates tracked.

Question 1 of 5
Documentation is a vital aspect of:
Why (b): Documents convert a sanction into an ENFORCEABLE contract — the credit function's legal spine.
Question 2 of 5
The prime purpose of loan documents is:
Why (b): The prime purpose of loan documents is to GROUND LEGAL REMEDY ON DEFAULT — they are the bank's courtroom weapons when recovery turns contested.
Question 3 of 5
Documents must be stamped per the:
Why (b): Documents must be stamped per the INDIAN STAMP ACT, 1899 — read with each State's schedule of rates.
Question 4 of 5
The limitation period for debt recovery is governed by the:
Why (b): The limitation period for debt recovery is governed by the LIMITATION ACT, 1963 — its schedules fix every recovery clock.
Question 5 of 5
Loan documents must be kept in:
Why (b): Loan documents must be kept in FIREPROOF, PILFER-PROOF CABINETS — the physical safety of the enforcement papers is the safety of the recovery itself.
0 of 5 answered.

Traps in this unit

Confusable AConfusable BThe difference
DPN stamp duty (uniform)Agreement duty (State-wise)Union vs State lists
Sec. 17Sec. 18Executed in India (before/at) vs abroad (3 months)
Practise all 59 questions on Unit 27. The free demo opens a slice of every subject with the same explanations; the PPB Online-only pass unlocks all 3,280 PPB questions, the full and module mocks, Smart Revision and the Readiness Score for one year (₹1,299). Not sure where you stand? Take the free 10-question test first.
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Independent study aid — not affiliated with, endorsed by, or sponsored by the Indian Institute of Banking & Finance (IIBF). Exam pattern, dates, fees and passing criteria are set by IIBF — always confirm the current rules at iibf.org.in. Regulatory figures verified as of September 2026; verify from official sources before relying on them in practice.