When termination of agent's authority takes effect as to agent, and as to third persons
Section 208 of the Indian Contract Act, 1872 deals with when termination of agent's authority takes effect as to agent, and as to third persons. The termination of the authority of an agent does not, so far as regards the agent, take effect before it becomes known to him, or, so far as regards third persons, before it becomes known to them. The Act came into force on 01 Sep 1872.
The termination of the authority of an agent does not, so far as regards the agent, take effect before it becomes known to him, or, so far as regards third persons, before it becomes known to them.
Illustrations
(a) A directs B to sell goods for him, and agrees to give B five per cent. commission on the price fetched by the goods. A afterwards, by letter, revoke B's authority. B, after the letter is sent, but before he receives it, sells the goods for 100 rupees. The sale is binding on A, and B is entitled to five rupees as his commission.
(b) A, at Madras, by letter, directs B to sell for him some cotton lying in a warehouse in Bombay, and afterwards, by letter, revokes his authority to sell, and directs B to send the cotton to Madras. B, after receiving the second letter, enters into a contract with C, who knows of the first letter, but not of the second, for the sale to him of the cotton. C pays B the money, with which B absconds. C's payment is good as against A.
(c) A directs B, his agent, to pay certain money to C. A dies, and D takes out probate to his will. B, after A's death, but before hearing of it, pays the money to C. The payment is good as against D, the executor.
Section 208, 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 that termination of authority of agent does not take effect before it becomes known to agent or third persons; critical for determining when cancellation of power of attorney becomes effective
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Thankamma George vs Lilly Thomas
Court's Decision & Legal Precedent
When a principal, during the subsistence of a power of attorney, independently executes a deed concerning the property that is the subject matter of the power of attorney, such independent action by the principal amounts to implied revocation of the power of attorney under Section 207 of the Indian Contract Act, 1872. The revocation becomes effective as to third parties when they have knowledge of such independent dealing by the principal, as required by Section 208. A sale deed executed by an agent after such implied revocation is void ab initio and does not bind the principal.
On this section: Termination of agent's authority does not take effect before it becomes known to the agent or third persons. The Court held that Respondent No. 2 had knowledge of the Appellant's independent dealing with the property, making the revocation effective.
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.
Questions about Section 208
What have the courts held on Section 208 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 that termination of authority of agent does not take effect before it becomes known to agent or third persons; critical for determining when cancellation of power of attorney becomes effective. Another 1 judgment on this section is set out below, all of them from the Supreme Court. They run from 2022 to 2024.
How do I find court cases under Section 208 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 208, section 208 Contract Act, section 208 of the Indian Contract Act. People searching for it also type 208 contract act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 2 reported judgments on this section are set out on this page, beginning with Amar Nath vs Gian Chand (28 Jan 2022).
When did Section 208 of the Indian Contract Act come into force?
Section 208 of the Indian Contract Act, cited as Contract Act 208, 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 15 Oct 2026. This page is not a substitute for legal advice.