Indian Contract Act, 1872 · Chapter X: Agency · Effect of agency on contracts with third persons
Section 230: Agent cannot personally enforce, nor be bound by, contracts on behalf of principal
In plain words
Unless agreed otherwise, an agent cannot personally enforce, and is not personally bound by, contracts made for the principal.
- Such an agreement making the agent personally liable is presumed where the agent buys or sells goods for a merchant living abroad, where the agent does not disclose the principal's name, or where the disclosed principal cannot be sued.
A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.
Official text
n the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
Presumption of contract to contrary—Such a contract shall be presumed to exist in the following cases:—
(1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad;
(2) where the agent does not disclose the name of his principal;
(3) where the principal, though disclosed, cannot be sued.
Source: India Code (indiacode.gov.in), the consolidated text published by the Legislative Department, Government of India. Text as updated on India Code on 15 October 2026. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.
Supreme Court judgments citing the section 230
-
INSC 1066 and SBI General Insurance Co. Ltd. v. Krish Spinning,
Whether an arbitral tribunal has the authority or power to implead or join a non-signatory to the arbitration agreement as a party to the arbitration proceedings.
- B. L. Kashyap and Sons Ltd v. M/S Jms Steels and Power Corporation & Anr.
- Virender Khullar v. American Consolidation Services Ltd. & Ors.
- The National Textile Corporation Ltd. v. Nareshkumar Badrikumar Jagad & Ors.
- Prem Nath Motors Ltd. v. Anurag Mittal
- M/S. Tashi Delek Gaming Solutions Ltd. and Anr. v. State of Karnataka and Ors.
- Beharilal and Anr. v. Smt. Bhuri Devi and Ors.