Indian Contract Act Section 143 — Guarantee obtained by concealment invalid

CHAPTER VIII OF INDEMNITY AND GUARANTEE

Commercial / Corporate

Summary

A guarantee is invalid if the creditor obtained it by staying silent about important facts that could affect the decision to give the guarantee. The section does not define what counts as a material circumstance, but it treats such silence as a ground for the guarantee to have no legal effect.

Official Text

Any guarantee which the creditor has obtained by means of keeping silence as to material circumstances, is invalid. Illustrations