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Section 171 -The Indian Contract Act, 1872

The Indian Contract Act, 1872


171. General lien of bankers, factors, wharfinger, attorneys and policy brokers –


Bankers, factor, wharfingers, attorneys of a High Court and policy brokers may, in the absence of a contract to the contrary, retain as a security for a general balance of account, any goods bailed to them; but no other person have a right retain, as a security for which balance, goods, bailed to them, unless is an express contract to that effect.1




Banker’s lien


In mercantile system the Bank has a general lien over all forms of securities or negotiable instruments deposited by or on behalf of the customers in the ordinary course of banking business. The Bank has the liberty to adjust from the proceeds of the two FDR’s towards the dues to the Bank and if there is any balance left that would belong to the depositor; Syndicate Bank v. Vijay Kumar, AIR 1992 SC 1066.


General and particular lien


Section 171 of the Act is clear and categoric that unless a contract to the contrary is established by the plaintiffs, the bank’s right of lien will have to be accepted; Smt. K.S. Nagalambika v. Corporation Bank, AIR 2000 Kant 201.


Workman’s lien for remuneration

The proposition that the bailee, who exercises a lien, is not entitled to charge rent for storage of goods can never apply to a case where the lien is exercised for non-payment of rent or storage charges; Om Shankar Biyani v. Board of Trustees, Port of Calcutta, (2002) 3 SCC 168.



1. As to lien of an agent, see section 221, infra. As to lien of a Railway Administration, see the Indian Railways Act, 1890 (9 of 1890), section 55. [Ed. The Indian Railways Act, 1890 (9 of 1890) has been repealed by the Railways Act, 1989 (24 of 1989) See. 200. Now see the Railways Act 1989 (24 of 1989, section 83.]



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The Indian Contract Act, 1872



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