Section 133 The Indian Contract Act, 1872
📜 Section 133 – The Indian Contract Act, 1872
Section 133 is under the chapter relating to Contracts of Guarantee.
🔍 Section 133 – Discharge of Surety by Variance in Terms of Contract
"Any variance, made without the surety’s consent, in the terms of the contract between the principal debtor and the creditor, discharges the surety as to transactions subsequent to the variance."
✅ Explanation:
If the terms of the original contract between the principal debtor and the creditor are changed without the consent of the surety, then the surety is discharged from their liability for future transactions.
🔑 Key Elements:
A contract of guarantee involves:
Principal debtor
Creditor
Surety
If the creditor alters the contract without informing or obtaining consent from the surety,
➤ the surety is not liable for any consequences arising after such alteration.
🧑⚖️ Example Case Law:
M.S. Anirudhan v. Thomco’s Bank Ltd. (AIR 1963 SC 746)
The Supreme Court held that a material variation in contract terms without the surety’s consent discharges the surety.
🧠 Illustration:
If a person guarantees repayment of a loan for ₹1,00,000, and later the creditor increases the loan amount to ₹1,50,000 without the surety’s permission, the surety is not liable for the increased amount.
📌 Important Note:
Only material changes (i.e., those affecting obligations) lead to discharge.
Changes made with the surety's consent do not discharge them.
RELATED Blog
0 comments