Chapter VIII - Of Indemnity and Guarantee
Section 137
Section 137: Mere delay in suing the debtor
A creditor’s mere delay in suing or using another remedy does not normally discharge the surety.
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Need advice on Section 137?
This article is for general information. Refer to the Indian Contract Act, 1872 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
Mere forbearance on the part of the creditor to sue the principal debtor or to enforce any other remedy against him does not, in the absence of any provision in the guarantee to the contrary, discharge the surety.
Illustration
B owes to C a debt guaranteed by A. The debt becomes payable. C does not sue B for a year after the debt has become payable. A is not discharged from his suretyship.
Rule and business relevance
The default applies in the absence of a contrary provision in the guarantee. Forbearance is distinguished from a binding promise to give time or not sue.
Limits and related provisions
This provision is not a general extension of limitation periods and does not cure every creditor act impairing recovery. Check the guarantee and other applicable rules.
Hypothetical business example
Hypothetical example: A creditor waits before suing a debtor. That delay alone does not discharge the surety under section 137, although limitation and any contractual duties still need review.
Practical decision flow
Distinguish inaction from a binding extension or no-suit agreement.
Check for a contrary guarantee provision.
Review limitation and any separate conduct-based discharge grounds.
Check the applicable legal framework
This guide explains the central provision. Applicable State amendments, the agreement, transaction date and other governing laws can affect its application. Check the current legal framework before relying on it for a commercial decision.
Practical checklist
Do
- Distinguish inaction from a binding extension or no-suit agreement.
- Check for a contrary guarantee provision.
- Review limitation and any separate conduct-based discharge grounds.
Avoid
- This provision is not a general extension of limitation periods and does not cure every creditor act impairing recovery. Check the guarantee and other applicable rules.
Glossary
- Mere forbearance
- Simply refraining from enforcement, without the relevant binding arrangement.
- Contrary provision
- A guarantee term changing the statutory default.
Frequently asked questions
Does a year’s delay automatically discharge the surety?
No. The illustration says it does not by itself.
Does this give unlimited time to sue?
No. Limitation and other applicable rules remain separate.
Can the guarantee change the default?
Yes. The section expressly recognises a provision to the contrary.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026