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Surety's Liability under a Time-barred Debt

By K. Chalapati Rao

Published In

Air 1980

The liability of the surety as laid down in Section 128 of the Indian Contract Act, 1872, is co-extensive with that of a principal debtor, unless it is otherwise provided by the contract between the parties. This Section only explains the measure of surety's obligation where the terms of the contract do not specify otherwise and has no reference to its extinction by the operation of the statute of Limitation. It only means in other words that the surety is liable for the whole of the amount for which the principal debtor is liable, but not anything less or more than that, unless otherwise provided in the contract. It does not therefore follow from the wording of the Section that the surety gets discharged whenever an action does not lie against the principal debtor, either because the contract between the debtor and the creditor was void as in the case of minor's contract, or because the action against the principal debtor was barred by limitation. In other words, a discharge of the ....

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