Chapter X - Agency
Section 229
Section 229: Notice and information received by agents
Notice or information received by an agent in the course of the principal’s transacted business can have the same consequences as receipt by the principal.
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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
Any notice given to or information obtained by the agent, provided it be given or obtained in the course of the business transacted by him for the principal, shall, as between the principal and third parties, have the same legal consequences as if it had been given to or obtained by the principal.
Illustrations
(a)A is employed by B to buy from C certain goods, of which C is the apparent owner, and buys them accordingly. In the course of the treaty for the sale, A learns that the goods really belonged to D, but B is ignorant of that fact. B is not entitled to set-off a debt owing to him from C against the price of the goods.
(b)A is employed by B to buy from C goods of which C is the apparent owner. A was, before he was so employed, a servant of C, and then learnt that the goods really belonged to D, but B is ignorant of that fact. In spite of the knowledge of his agent, B may set-off against the price of the goods a debt owing to him from C.
Rule and business relevance
The business-course condition is central. The illustrations distinguish information learned during the purchase agency from knowledge acquired earlier in another employment.
Limits and related provisions
Do not attribute every fact an agent has ever known to the principal under this provision. Establish when and in what business context it was obtained.
Hypothetical business example
Hypothetical example: A purchasing agent learns during negotiations that the seller is not the true owner. That knowledge is assessed as information acquired in the principal’s business.
Practical decision flow
Identify the notice or information.
Establish when and in which business it was received.
Assess its legal consequence between principal and third party.
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
- Identify the notice or information.
- Establish when and in which business it was received.
- Assess its legal consequence between principal and third party.
Avoid
- Do not attribute every fact an agent has ever known to the principal under this provision. Establish when and in what business context it was obtained.
Glossary
- Imputed notice
- The legal consequence of qualifying notice to the agent being treated as notice to the principal.
- Business-course condition
- Receipt in the course of business transacted for the principal.
Frequently asked questions
Is all prior personal knowledge automatically included?
No. The statutory illustrations distinguish earlier knowledge from information acquired in the relevant business.
Whose relationships does the rule address?
The principal’s relationships with third parties.
Does the principal need actual personal awareness?
Qualifying notice to the agent has the stated consequences even without separate personal receipt.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026