Chapter X - Of Reasonable Time
Section 107
Section 107: reasonable time for transmitting such notice
Section 107 measures the onward-notice period for a notified party seeking recourse against a prior party.
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Need advice on Section 107?
This article is for general information. Refer to the Negotiable Instruments Act, 1881 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
A party receiving notice of dishonour, who seeks to enforce his right against a prior party, transmits the notice within a reasonable time if he transmits it within the same time after its receipt as he would have had to give notice if he had been the holder.
Applicability and limits
Applies when a party who received dishonour notice seeks to enforce rights against an earlier party.
The rule measures time from receipt and gives a holder-equivalent period; it does not remove the underlying need to transmit notice.
Hypothetical example
Hypothetical: an indorser receives notice on Tuesday and needs recourse against a prior indorser. They record receipt and dispatch onward notice within the time a holder would have had.
Steps and evidence
Record exact receipt date and method.
Identify the prior party.
Calculate the holder-equivalent notice period and retain dispatch evidence.
Practical checklist
Do
- Record when the party received the notice.
- Identify the prior party whose liability is sought.
- Transmit within the period the sender would have had as holder.
Avoid
- The rule measures time from receipt and gives a holder-equivalent period; it does not remove the underlying need to transmit notice.
Glossary
- Transmitting notice
- Passing dishonour notice onward to a prior party.
- Recourse
- A claim against an earlier liable party on the instrument.
Frequently asked questions
How is onward notice timing measured?
Section 107 gives the recipient the same interval after receipt as the holder would have had for giving notice.
What starts the onward-notice clock?
Section 107 measures the period after the party receives notice.
Who is the timing comparator?
The party has the same time that they would have had to give notice if they had been the holder.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026