Section 83 of the Negotiable Instruments Act,1881.
If the holder of a bill of exchange allows the drawee more than forty-eight hours, exclusive of public holidays, to consider whether he will accept the same, all previous parties not consenting to such allowance are thereby discharged from liability to such holder.
The words, forty-eight hours, have been substituted for, twenty-four hours, by the Amending Act XII of 1921, section 2 to avoid inconvenience and hardship.
The section applies only to bills of exchange in which acceptance by the drawee is obligatory i.e. bills after sight, and does not apply to other bills nor to hundis. It does not apply to presentment for payment but applies only to presentment for acceptance. It has already been noticed that an acceptor is entitled to have forty-eight hours notice to consider whether he will accept a bill or refuse it.1) And the holder is bound to leave the instrument to the drawee fot 48 hours exclusive of holidays. If after 48 hours he does not signify his acceptance the bill will be deemed to have been dishonoured and the holder must give the necessary notice. Besides this, a further duty is cast upon the holder and he should not enlarge the period of forty-eight hours and grant the drawee more time for deliberation for acceptance. If he does so, without their consent, all previous parties to the bill will be discharged from liability. Parties consenting to the extension of time will not be discharged.
The drawer cannot claim discharge under this section if a bill incapable of being accepted or dishonoured is left with the drawee for more than 48 hours2) as in such a case no notice of dishonour is necessary.