Principal's right to benefit gained by agent dealing on his own account in business of agency
Section 216 of the Indian Contract Act, 1872 deals with principal's right to benefit gained by agent dealing on his own account in business of agency. If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account of his principal, the principal is entitled to claim from the agent any benefit which may have resulted to him from the transaction. The Act came into force on 01 Sep 1872.
If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account of his principal, the principal is entitled to claim from the agent any benefit which may have resulted to him from the transaction.
Illustration
A directs B, his agent, to buy a certain house for him. B tells A it cannot be bought, and buys the house for himself. A may, on discovering that B has bought the house, compel him to sell it to A at the price he gave for it.
Section 216, The Indian Contract Act, 1872 (Act 9 of 1872).
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.
-
… page 21 Picture 0.jpeg) 36.If according to the plaintiffs, the sale consideration had not been paid to them, then the principal / the plaintiffs have a right to the benefit which had been gained by the agent, in this case, the 1st defendant. 37.Section 216 of the Indian Contract Act, 1872 is as follows: "216. Principal's right to benefit gained by agent dealing on his own account in business of agency.—If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account of his principal, the principal is …
Questions about Section 216
What does Section 216 of the Indian Contract Act deal with?
Section 216 of the Indian Contract Act is headed "Principal's right to benefit gained by agent dealing on his own account in business of agency". If an agent, without the knowledge of his principal, deals in the business of the agency on his own account instead of on account of his principal, the principal is entitled to claim from the agent any benefit which may have resulted to him from the transaction.
How do I find court cases under Section 216 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 216, section 216 Contract Act, section 216 of the Indian Contract Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome.
When did Section 216 of the Indian Contract Act come into force?
Section 216 of the Indian Contract Act, cited as Contract Act 216, 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.