Question

An 'accommodation bill' under the Act is one drawn and accepted without what?

Q: Answer-An 'accommodation bill' under the Act is one drawn and accepted without what?

An accommodation bill under the Negotiable Instruments Act is a bill drawn, accepted or endorsed without consideration, where one party lends his name and credit to accommodate another party. The accommodating party becomes liable on the instrument to a holder for value, even though he received no consideration himself. Such bills are used to raise short-term finance. As between the immediate parties, the absence of consideration may be a defence, but not against a holder in due course.