Suvidha Ltd. was on the verge of expansion. It was requiring ₹40 lakhs for modernisation of its Machinery. It decided to issue Rs.30 lakhs, 7% debentures to public for cash and to borrow ₹10 lakhs from SBI Bank as long term loan, with a condition from SBI to issue ₹12 lakhs. 7% debentures as a subsidiary security besides the primary security, to which the company agreed. The face value of 7% debenture was ₹100.

Identify the debentures that are transferrable by mere delivery.

Bearer debentures

The correct answer is option 4- Bearer debentures.

Bearer debentures are not registered in the name of the holder and are payable to the bearer of the instrument. They are transferable by mere delivery, meaning ownership can be transferred simply by physically handing over the debenture certificate to another party, without the need for any formal registration or endorsement.