Section 248 The Indian Contract Act, 1872
📜 Section 248 – The Indian Contract Act, 1872
🔍 Section 248 – Agent’s Authority to Bind Principal When Agent Acts Within Scope
"When an agent acts within the scope of his authority, the principal is bound by all lawful acts done by the agent in exercise of such authority."
✅ Explanation:
This section establishes the principle of principal’s liability for acts of the agent:
If the agent acts within the authority given by the principal,
The principal is legally bound by all lawful acts done by the agent while exercising that authority.
🔑 Key Points:
Applies to lawful acts — illegal or unauthorized acts do not bind the principal.
The scope of authority can be express (clearly given) or implied.
Protects third parties dealing with the agent in good faith.
🧠 Illustration:
If A appoints B as an agent to purchase machinery on A’s behalf, and B enters into a valid contract within his authority, then A must honor that contract even if B did not get prior approval for that particular deal, as long as it was within B’s authority.
🧑⚖️ Relevant Case:
Central Inland Water Transport Corporation Ltd. v. Brojo Nath Ganguly (AIR 1986 SC 1571) — The court held that the principal is liable for contracts entered into by the agent acting within the scope of their authority.
RELATED Blog
0 comments