Termination of agency, where agent has an interest in subject-matter
Section 202 of the Indian Contract Act, 1872 deals with termination of agency, where agent has an interest in subject-matter. Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest. The Act came into force on 01 Sep 1872.
Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest.
Illustrations
(a) A gives authority to B to sell A's land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death.
(b) A consigns 1,000 bales of cotton to B, who has made advances to him on such cotton, and desires B to sell the cotton, and to repay himself out of the price, the amount of his own advances. A cannot revoke this authority, nor is it terminated by his insanity or death.
Section 202, The Indian Contract Act, 1872 (Act 9 of 1872).
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Amar Nath vs Gian Chand
Court's Decision & Legal Precedent
When a person holding a power of attorney executes a document on behalf of the principal and presents that document for registration, such person is the 'person executing' the document within the meaning of Section 32(a) of the Registration Act and is entitled to present it for registration without producing the original power of attorney. The production of the original power of attorney is not mandatory for valid registration. Section 18A of the Registration Act requires production of a true copy of the document being registered (not the power of attorney) to expedite the copying process. Sections 32(c) and 33 of the Registration Act, which deal with production of power of attorney, apply only to agents presenting documents for registration, not to persons who have themselves executed the document. Cancellation of a power of attorney, even if validly effected, does not become effective against third parties until notice of such cancellation is brought to their knowledge, as per Section 208 of the Indian Contract Act. The High Court exceeded its jurisdiction under Section 100 CPC by reappreciating evidence and reversing concurrent findings of the trial court and first appellate court on factual matters.
On this section: Provides exception to power of principal to revoke agency where agent has interest in property forming subject of agency; agency cannot be terminated to prejudice of agent's interest
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… would be Section 201 of the Contract Act that may come into operation. " (iii) Thirdly , the principal contention of the appellants was that since the holder of POA had an interest in the property which is the subjectmatter of the POA, the POA would not come to an end on the death of the executant by virtue of Section 202 of the Indian Contract Act, 1872 (for short, " the Contract Act "). The High Court held that executing a POA, including an irrevocable one or an agreement to sell for immovable property, does not automatically transfer any right or interest to the beneficiary, such as the attorney or agreement holder. By referring …
Questions about Section 202
What have the courts held on Section 202 of the Indian Contract Act?
Amar Nath vs Gian Chand (28 Jan 2022) is the leading judgment on this section among those set out below: Provides exception to power of principal to revoke agency where agent has interest in property forming subject of agency; agency cannot be terminated to prejudice of agent's interest.
How do I find court cases under Section 202 of the Indian Contract Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Contract Act 202, section 202 Contract Act, section 202 of the Indian Contract Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Amar Nath vs Gian Chand (28 Jan 2022).
When did Section 202 of the Indian Contract Act come into force?
Section 202 of the Indian Contract Act, cited as Contract Act 202, came into force on 01 Sep 1872, having been enacted on 25 Apr 1872. It is in force as at the date shown on this page.
Other sections of this Act
- 73. Compensation for loss or damage caused by breach of contract1822 words
- 23. What considerations and objects are lawful, and what not596 words
- 74. Compensation for breach of contract where penalty stipulated for577 words
- 28. Agreements in restraint of legal proceeding void512 words
- 25. Agreement without consideration, void, unless it is in writing and registered, or is a promise to compensate for something done, or is a promise to pay a debt barred by limitation law423 words
- 16. "Undue influence" defined397 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 14 Oct 2026. This page is not a substitute for legal advice.