Q. Which of the following phrases defines the nature of the ‘Hundi’ generally referred to in the sources of the post-Harsha period?

• An advisory issued by the king to his subordinates
• A diary to be maintained for daily accounts
• A bill of exchange
• An order from the feudal lord to his subordinates

Answer: (c) A bill of exchange

Hundi:

• It is a financial instrument that developed in Medieval India for use in trade and credit transactions.
• They were used
  • As remittance instruments (to transfer funds from one place to another)
  • As credit instruments (to borrow money)
  • trade transactions (as bills of exchange).

Taxes:

• Uparikara — Levied on cloth, oil, etc. when taken from one city to another.
• Shulka — Commercial tax paid by the organisation of the traders. Non-payment of which resulted in cancellation of the right to trade and a fine amounting to eight times of the original Shulka.
• Vishthi — Practice of Forced labour