Chapter III - Parties to Notes, Bills and Cheques
Section 28
Section 28: liability of agent signing
Section 28 can make an agent personally liable when the instrument does not show that the signature is made for the principal or without personal responsibility.
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Need advice on Section 28?
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
An agent who signs his name to a promissory note, bill of exchange or cheque without indicating thereon that he signs as agent, or that he does not intend thereby to incur personal responsibility, is liable personally on the instrument, except to those who induced him to sign upon the belief that the principal only would be held liable.
Applicability and limits
An agent signing a note, bill or cheque can incur personal liability unless the instrument indicates signature as agent for the principal or without personal responsibility.
The statutory exception concerns a person who induced the agent to sign believing only the principal would be held liable.
Hypothetical example
Hypothetical: a finance manager signs a bill only with their own name. The business checks whether the instrument itself shows representative capacity before assuming the company alone is liable.
Evidence and decision flow
Inspect the exact signature block and capacity words.
Identify the principal and any express exclusion of personal responsibility.
Preserve communications relevant to the statutory exception.
Practical checklist
Do
- Identify the principal, the authorised signer and the capacity shown next to the signature.
- Keep evidence of the authority and any discussion with the recipient about who would be liable.
Avoid
- Do not treat the instrument label alone as conclusive; check the signed wording and related statutory conditions.
Glossary
- Principal
- The person or entity for whom the agent acts.
- Representative capacity
- Signing expressly as an agent, rather than personally.
Frequently asked questions
Can an agent be personally liable for signing a company cheque?
Section 28 can impose personal liability where the instrument does not indicate agency or exclude personal responsibility, subject to its stated exception.
Does a job title alone settle liability?
The instrument should be examined for the statutory indication of agency or no personal responsibility.
Can surrounding conduct matter?
The exception addresses those who induced the agent to sign believing only the principal would be liable.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026