Sections 108-112 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Acceptance for honour lets an outsider step in and accept a bill that the drawee has refused, so as to save the credit of a party to the bill. Sections 108 to 112 say who may do it, how it is done, whose honour it protects, what the acceptor for honour owes and when he can be charged. This follows the consolidated text consulted.
When a bill of exchange has been noted or protested for non-acceptance or for better security, a person who is not already liable on it may, with the holder's consent, accept it in writing on the bill for the honour of a party (s.108). He must declare that he accepts under protest for the honour of the drawer, a named indorser, or generally (s.109); if he does not say, it is for the drawer's honour (s.110). He then binds himself to later parties to pay if the drawee does not (s.111), but can be charged only after presentment to the drawee, dishonour and noting or protest (s.112).
Context
A bill of exchange is an order to a drawee to pay. If the drawee will not accept, or the acceptor looks unsound, the holder may have the dishonour noted or protested; see Sections 99 and 100. Acceptance for honour is a rescue step that follows. The Act also names the "acceptor for honour" among the parties in Section 7, and the contents of a protest must record an acceptance for honour under Section 101. The sections apply to bills of exchange; they do not mention cheques.
Where a bill is dishonoured and you need advice on the available steps, a legal consultation can help sort out what is open. A note on spelling: the Act writes "indorser"; "endorse" is the common spelling.
Section 108: who may accept for honour, and when
The text says that "when a bill of exchange has been noted or protested for non-acceptance or for better security", any person "not being a party already liable thereon" may, "with the consent of the holder, by writing on the bill, accept the same for the honour of any party thereto."
Conditions in the text:
- The bill has been noted or protested for non-acceptance or for better security.
- The person is not a party already liable on the bill.
- The holder consents.
- The acceptance is by writing on the bill.
- It is for the honour of "any party thereto", that is, any party to the bill.
Section 109: how it must be made
The person "must, by writing on the bill under his hand, declare that he accepts under protest the protested bill for the honour of the drawer or of a particular indorser whom he names, or generally for honour". The text of this section has no full stop at the end, as printed.
So the writing must say three things: that it is an acceptance under protest of the protested bill, and for whose honour it is made, which is one of three choices: the drawer, a named indorser, or generally for honour.
Section 110: acceptance not saying for whose honour
"Where the acceptance does not express for whose honour it is made it shall be deemed to be made for the honour of the drawer." This is a default rule. It also affects who is liable to the acceptor under Section 111, because the party honoured fixes where the acceptor's right of recoupment begins.
Section 111: liability of the acceptor for honour
The text has two paragraphs.
Liability to later parties. An acceptor for honour "binds himself to all parties subsequent to the party for whose honour he accepts to pay the amount of the bill if the drawee do not". The party honoured, and all prior parties, "are liable in their respective capacities to compensate the acceptor for honour for all loss or damage sustained by him in consequence of such acceptance."
Condition for liability to the holder. "But an acceptor for honour is not liable to the holder of the bill unless it is presented, or (in case the address given by such acceptor on the bill is a place other than the place where the bill is made payable) forwarded for presentment, not later than the day next after the day of its maturity."
Section 112: when the acceptor for honour may be charged
"An acceptor for honour cannot be charged unless the bill has at its maturity been presented to the drawee for payment, and has been dishonoured by him, and noted or protested for such dishonour." There are three cumulative conditions: presentment to the drawee at maturity, dishonour by the drawee, and noting or protest for that dishonour.
At a glance
| Section | Topic | Key point |
|---|---|---|
| 108 | Who may accept for honour | A person not already liable, with the holder's consent, by writing on the bill, after noting or protest for non-acceptance or better security |
| 109 | How | Written declaration under his hand that he accepts under protest, naming the drawer, a particular indorser or "generally for honour" |
| 110 | Silent acceptance | Deemed for the honour of the drawer |
| 111 | Liability | Binds himself to subsequent parties if the drawee does not pay; recoups from the honoured party and prior parties; not liable to the holder unless presented, or forwarded, not later than the day next after maturity |
| 112 | When charged | Only after presentment to the drawee at maturity, dishonour, and noting or protest |
A worked example
Example. Anand Mills draws a bill on Reddy Retail, payable to Bose Wholesale, who indorses it to Chauhan Finance. Reddy Retail refuses to accept it and the bill is protested for non-acceptance. Dutta Bank, which is not a party to the bill, wishes to protect Bose Wholesale's name. With Chauhan Finance's consent, Dutta Bank writes on the bill under its hand that it accepts the protested bill under protest for the honour of Bose Wholesale. Under Section 111, Dutta Bank binds itself to the parties after Bose Wholesale (here Chauhan Finance) to pay the bill if the drawee does not, and Bose Wholesale and Anand Mills, as the party honoured and the prior party, must compensate Dutta Bank for any loss. At maturity, Chauhan Finance must present the bill to Reddy Retail; only if Reddy Retail dishonours it, and it is noted or protested, can Dutta Bank be charged (Section 112), and Chauhan Finance must present the bill to Dutta Bank, or forward it for presentment, not later than the day after maturity.
Points to watch
- Consent. The text requires the holder's consent; it does not say how that consent is shown.
- Not already liable. A person already liable on the bill is outside Section 108.
- Writing. Both Section 108 and Section 109 call for writing on the bill, so an oral promise will not do.
- Day-after-maturity rule. The holder's presentment to the acceptor for honour must not be later than the day next after maturity (Section 111).
- Interaction with payment for honour. Payment for honour is a separate facility; see Sections 113 to 116.
- No amounts or fees. The text states no commission or fee for an acceptor for honour.
Need help with a refused bill?
If a drawee has refused to accept a bill and a third party is willing to step in, the written terms of the acceptance matter. A legal consultation can help you review the wording against Sections 108 to 112 before anything is signed.
Key takeaways
- Acceptance for honour follows noting or protest for non-acceptance or for better security.
- The acceptor must be a person not already liable, must have the holder's consent and must write on the bill.
- Silence as to whose honour means the drawer's honour.
- The acceptor for honour is liable to later parties if the drawee does not pay, but only after presentment, dishonour and noting or protest.
- The holder must present, or forward for presentment, to the acceptor for honour not later than the day next after maturity.
Read next
- Sections 113 to 116: payment for honour and drawee in case of need
- Sections 99 and 100: noting and protest by a notary public
- Section 7: drawer, drawee, acceptor and payee
- Bill of exchange in export trade
Disclaimer: Based on a consolidated text of the Negotiable Instruments Act, 1881 stating the position as of 26 December 2015 and on the Negotiable Instruments (Amendment) Act, 2018, as consulted on 2 October 2026. Later amendments and current criminal procedure law should be checked. This article is general information, not legal advice; check the official text before acting.