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Some cases it is said that Surety is not discharged since the variation was made Beneficial to surety and few cases it is said that Surety is not discharged even if it made Beneficial to Surety. How to distinguish btwn both? How to answer in the exam?
Answers (12)
Best Answer
Note that general rule given in Section 133 is mostly applicable i.e. Where there is any variance in the terms of contract between the principal debtor and creditor without surety consent, it would discharge the surety in respect of all transactions taking place subsequent to such variance. Though in the ICAI material, there is an exception mentioned that Variation which is not substantial or material or which is beneficial to the surety will not discharge him of his liability. That exception is very specific to the case law mentioned alongside. So, unless there is a question which is very similar to the facts of the case, general rule will mostly apply.
Swetha S
Question 3 Surety is discharged Here the variation is significant
How to know whether it is significant or not?
Kumar G
Can you please share those questions
The questions shared below are my doubts. Can u pls tell me what to be taken as significant and what not to be taken as the same?
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