Section 14 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 14 puts three terms into a contract of sale without anyone writing them: the seller's right to sell the goods (an implied condition), the buyer's quiet possession (an implied warranty) and the absence of any undeclared charge or encumbrance on the goods (a second implied warranty). All three yield if "the circumstances of the contract are such as to show a different intention".
In a contract of sale, unless the circumstances show a different intention, there is (a) an implied condition that the seller has a right to sell the goods (or, in an agreement to sell, will have it when the property is to pass), (b) an implied warranty that the buyer shall have and enjoy quiet possession, and (c) an implied warranty that the goods carry no charge or encumbrance in favour of a third party that was not declared or known to the buyer before or when the contract is made.
Reading note
This article follows the consolidated text of the Act consulted (latest amendment shown: Act 28 of 1993); later amendments should be checked in the official text. The words "condition" and "warranty" carry the meanings given in section 12: breach of a condition gives a right to treat the contract as repudiated, breach of a warranty gives a claim for damages. A buyer purchasing machinery, vehicles or stock from a dealer should have the supply paper checked; a vendor and supplier agreement can state these undertakings in plain terms.
The opening words
"In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is—". Three things are packed into this line.
- It applies to "a contract of sale" generally, so to both a sale and an agreement to sell (section 4).
- The undertakings are implied: they are there although the contract does not mention them.
- They give way if "the circumstances of the contract are such as to show a different intention". The Act speaks of circumstances here, not only of written terms.
Section 14(a): the right to sell (an implied condition)
"An implied condition on the part of the seller that, in the case of a sale, he has a right to sell the goods and that, in the case of an agreement to sell, he will have a right to sell the goods at the time when the property is to pass."
The sub-section splits by kind of contract:
- A sale: the seller has a right to sell the goods. The property passes under the contract, so the right must exist now.
- An agreement to sell: the seller will have a right to sell at the time when the property is to pass. The right need not exist when the agreement is signed, but it must exist when the property is to pass.
This is a condition, in the sense of section 12(2): it goes to the root of the bargain. Its breach gives the buyer the right to treat the contract as repudiated, subject to what section 13 provides.
Example (the writer's own, not printed in the Act): Imran Motors sells a used car to Latha. Unknown to Latha, the car belongs to a third person who has not authorised the sale. Imran Motors did not have a right to sell. The implied condition in section 14(a) has been broken. (Whether a buyer gets any title in such a case is the subject of section 27, taken up in a separate article.)
Section 14(b): quiet possession (an implied warranty)
"An implied warranty that the buyer shall have and enjoy quiet possession of the goods."
This is a warranty, so its breach gives a claim for damages. The sub-section does not define "quiet possession", and this article does not add a definition. The words used are "have and enjoy", which look to the buyer's continuing position once the goods are his.
Example (the writer's own): Mahesh buys a printing press from Fine Print Machinery. A month later another firm turns up and takes the press, saying it is entitled to it. Mahesh's possession has been disturbed; the matter engages the implied warranty in 14(b).
Section 14(c): no undeclared charge or encumbrance (an implied warranty)
The clause is paraphrased here, not quoted: it implies a warranty that the goods carry no charge or encumbrance in favour of a third party that was not declared or known to the buyer before or at the time when the contract is made.
Several points follow from that:
- It is a warranty, so the buyer's remedy for breach is damages.
- The charge or encumbrance must be "in favour of any third party".
- The warranty is breached only if the charge was not declared or known to the buyer before or at the time when the contract is made. A charge the seller declared, or the buyer already knew about, is outside it.
Example (the writer's own): Orbit Traders sells a stock of electronics to Zaveri Retail. Zaveri Retail is not told that a lender holds a charge over the stock and does not know of it. The implied warranty in 14(c) is broken. If Orbit Traders had said, in the contract or earlier, "this stock is subject to a lender's charge", there would be no breach of 14(c).
The three undertakings side by side
| Clause | Subject | Nature | Effect of breach (section 12) |
|---|---|---|---|
| 14(a) | seller's right to sell (now, or when property is to pass) | implied condition | right to treat the contract as repudiated |
| 14(b) | buyer's quiet possession | implied warranty | claim for damages |
| 14(c) | no undeclared charge or encumbrance in favour of a third party | implied warranty | claim for damages |
The "effect of breach" column applies the meanings of section 12; section 13 may then limit the right to repudiate in the cases it describes.
Varying the undertakings
The opening phrase lets the circumstances show a different intention. A seller who sells only what right he has, for example a stock held by a lender or one subject to a lien, can say so in the contract so that the buyer takes with knowledge. Section 14(c) already ties the warranty to what was "not declared or known to the buyer". So declaration and disclosure should be written down, with schedules of the charges that exist.
For other statutes that imply a warranty on the sale of marked or indicated goods, there are separate posts on Section 126 of the Trade Marks Act, 1999 and Section 59 of the GI Act, 1999. They are different laws and are not described here.
Practical points
- For the buyer: ask for proof that the seller can sell, and ask in writing whether any charge exists. The implied condition helps, but a written declaration is better evidence.
- For the seller: declare every charge in the contract. Section 14(c) turns on what was "declared or known".
Need help with title and warranty clauses?
If you are buying or supplying goods and want title, possession and charges dealt with in the paper, our team can prepare or review a vendor and supplier agreement that names the undertakings, schedules any charge and states where the parties intend something different.
Key takeaways
- Section 14 implies three terms in a contract of sale unless the circumstances show a different intention.
- The seller's right to sell is an implied condition; quiet possession and absence of undeclared charges are implied warranties.
- In an agreement to sell, the right to sell must exist at the time when the property is to pass.
- A charge declared to or known by the buyer before or at the time of the contract does not breach 14(c).
- Disclosure in writing protects both sides.
Read next
- Section 12 of the Sale of Goods Act, 1930: condition and warranty defined
- Section 13 of the Sale of Goods Act, 1930: when a condition is treated as a warranty
- Section 15 of the Sale of Goods Act, 1930: sale by description
- Section 27 of the Sale of Goods Act, 1930: sale by a person who is not the owner
Disclaimer: Based on the consolidated text of the Sale of Goods Act, 1930 consulted on 2 October 2026, whose latest amendment shown is Act 28 of 1993. It explains the words of the statute only; later amendments and the way courts apply these sections should be checked. This article is general information, not legal advice; check the official text before acting.