Chapter IX - Of Bailment
Section 169
Section 169: When a finder may sell goods
A finder’s power to sell lost goods is restricted by both owner-related and goods-or-charges conditions.
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This article is for general information. Refer to the Indian Contract Act, 1872 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
When a thing which is commonly the subject of sale is lost, if the owner cannot with reasonable diligence be found, or if he refuses, upon demand, to pay the lawful charges of the finder, the finder may sell it—
(1) when the thing is in danger of perishing or of losing the greater part of its value, or,
(2) when the lawful charges of the finder, in respect of the thing found, amount to two-thirds of its value.
Rule and business relevance
The thing must commonly be the subject of sale. The owner must be unfindable with reasonable diligence or refuse lawful charges on demand; additionally, the goods must risk perishing or losing most value, or lawful charges must reach two-thirds of value.
Limits and related provisions
Do not treat the two-thirds threshold alone as sufficient while ignoring the owner-related condition. Keep valuation and search evidence.
Hypothetical business example
Hypothetical example: A finder cannot locate the owner despite reasonable diligence and the commonly traded goods are about to perish. The statutory sale conditions require a documented assessment.
Practical decision flow
Establish reasonable owner-search efforts or refusal after demand.
Check the goods are commonly sold.
Document perishability or value-loss risk, or lawful charges reaching two-thirds of value.
Check the applicable legal framework
This guide explains the central provision. Applicable State amendments, the agreement, transaction date and other governing laws can affect its application. Check the current legal framework before relying on it for a commercial decision.
Practical checklist
Do
- Establish reasonable owner-search efforts or refusal after demand.
- Check the goods are commonly sold.
- Document perishability or value-loss risk, or lawful charges reaching two-thirds of value.
Avoid
- Do not treat the two-thirds threshold alone as sufficient while ignoring the owner-related condition. Keep valuation and search evidence.
Glossary
- Lawful charges
- Charges legally due to the finder in respect of the goods.
- Two-thirds threshold
- The alternative charge-to-value condition stated in clause (2).
Frequently asked questions
Is the charge threshold enough by itself?
No. The opening owner-related conditions also apply.
Is imminent loss of most value relevant?
Yes, as an alternative goods-condition in clause (1).
Must owner-search efforts be reasonable?
Yes. The provision expressly requires reasonable diligence where the owner cannot be found.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026