Indian Contract Act, 1872 · Chapter X: Agency · Effect of agency on contracts with third persons
Section 234: Consequence of inducing agent or principal to act on belief that principal or agent will be held exclusively liable
In plain words
If a person contracting with an agent leads the agent to act on the belief that only the principal will be liable, or leads the principal to believe only the agent will be liable, they cannot later hold the agent or principal respectively liable.
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
When a person who has made a contract with an agent induces the agent to act upon the belief that the principal only will be held liable, or induces the principal to act upon the belief that the agent only will be held liable, he cannot afterwards hold liable the agent or principal respectively.
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 234
No Supreme Court judgment in our database cites this section yet.