Section 117 IEA: Estoppel of acceptor of bill of exchange, bailee or licensee

Indian Evidence Act, 1872

Section 117 IEA at a Glance

Section 117 IEA deals with estoppel of acceptor of bill of exchange, bailee or licensee. From 1 July 2024 it is replaced by Section 123 BSA.

Now BSA

Section 123 →

Section 117 IEA Bare Act Text

117. Estoppel of acceptor of bill of exchange, bailee or licensee

No acceptor of a bill of exchange shall be permitted to deny that the drawer had authority to draw such bill or to endorse it; nor shall any bailee or licensee be permitted to deny that his bailor or licensor had, at the time when the bailment or licence commenced, authority to make such bailment or grant such licence.

Explanation (1).—The acceptor of a bill of exchange may deny that the bill was really drawn by the person by whom it purports to have been drawn.

Explanation (2).—If a bailee delivers the goods bailed to a person other than the bailor, he may prove that such person had a right to them as against the bailor.

Source: Section 117, Indian Evidence Act, 1872

Section 117 IEA in Simple Words

Section 117 of the Indian Evidence Act, 1872 sets out rules of estoppel (a legal bar against denying an accepted fact). It stops acceptors of bills of exchange, bailees, and licensees from denying the authority of the person they dealt with.

In a bill of exchange (a written order to pay money), an acceptor agrees to pay the bill. The acceptor cannot deny that the drawer (the maker of the bill) had authority to draw or endorse (sign to transfer) it. However, under Explanation (1), the acceptor can deny that the named drawer actually drew the bill.

A bailee (a person holding delivered goods) cannot deny that the bailor (the giver) had authority when the bailment began. A licensee (a person given permission) similarly cannot deny that the licensor had authority to grant the licence when it started. Under Explanation (2), a bailee who delivers the goods to someone else can prove that receiver had a right against the bailor.

When Section 117 IEA Applies

  • Applies to a person who accepts a bill of exchange, stopping a denial of the authority of the drawer to draw or endorse it.
  • Applies to a bailee, stopping a denial that the bailor had authority to make the bailment when it started.
  • Applies to a licensee, stopping a denial that the licensor had authority to grant the licence when the licence started.

Example of Section 117 IEA

In 2021, Ramesh delivers goods in Mumbai to Anita as a bailee for safekeeping. A dispute over the bailment later comes before a court. Anita tries to argue that Ramesh had no authority to make the bailment when the goods were handed over. Under Section 117 IEA, the court does not permit Anita to deny that Ramesh had authority to make the bailment of the goods in Mumbai when it began.

When Section 117 IEA Does Not Apply

  • Under Explanation (1), a person who accepts a bill of exchange can deny that the named drawer truly drew the bill.
  • Under Explanation (2), a bailee who hands over the bailed goods to someone other than the bailor can prove that receiver had a right to the goods against the bailor.

Section 117 IEA in the BSA

Section 117 IEA is now covered under Section 123 BSA.

Section 117 of the Indian Evidence Act, 1872 became Section 123 of the Bharatiya Sakshya Adhiniyam, 2023 on 1 July 2024 without any change in wording.

View detailed comparison (IEA 117 vs BSA 123) →

FAQs on Section 117 IEA

What is Section 117 IEA?▼

Section 117 of the Indian Evidence Act, 1872 is a rule of estoppel for bills of exchange, bailments, and licences. It stops an acceptor on a bill of exchange from denying the authority of the drawer to draw or endorse the bill. It also stops a bailee or licensee from denying that the bailor or licensor had authority when the bailment or licence started.

Can the acceptor on a bill of exchange deny that the named drawer actually drew the bill under Section 117 IEA?▼

Yes. While the acceptor cannot deny the authority of the drawer to draw or endorse the bill, Explanation (1) to Section 117 IEA allows a narrow denial. The acceptor can deny that the named person truly drew the bill.

Can a bailee who delivers goods to someone other than the bailor prove that person had a right to them under Section 117 IEA?▼

Yes. Under Explanation (2) to Section 117 IEA, if a bailee hands over the bailed goods to someone other than the bailor, the bailee can prove that receiver held a right to the goods against the bailor.

What is Section 117 IEA in BSA?▼

Section 123 BSA replaced Section 117 IEA on 1 July 2024 without any change in wording. The same rule applies under Section 123 BSA.

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Disclaimer: This is for informational purposes only. Always consult a qualified advocate for legal advice.

Sources: Bare Act Text, Indian Evidence Act, 1872 ·