Section 203 The Indian Contract Act, 1872
📜 Section 203 – The Indian Contract Act, 1872
🔍 Section 203 – Revocation of Authority
"The principal may, save as is otherwise provided by the contract, revoke the authority given to his agent at any time before the authority has been exercised so as to bind the principal."
✅ Explanation:
This section explains when and how a principal can revoke (cancel) the authority given to an agent.
The principal can revoke the agent’s authority:
At any time, before the agent has acted in a way that binds the principal.
Once the agent has entered into a binding contract or transaction with a third party on behalf of the principal, the authority for that act cannot be revoked.
🔑 Key Points:
Revocation is allowed only before the authority has been exercised in a binding way.
If the agent has already created legal obligations for the principal, those cannot be undone by revoking authority afterward.
The right to revoke may be limited by contract—i.e., there may be specific conditions under which revocation is allowed or disallowed.
🧠 Illustration:
A gives authority to B to sell his house. Before B actually enters into a sale agreement with a buyer, A can revoke the authority.
But if B has already signed a valid sale agreement with a buyer on A’s behalf, then A cannot revoke B’s authority for that sale.
🧑⚖️ Case Reference:
In Syed Abdul Khader v. Rami Reddy (AIR 1979 SC 553), the Supreme Court held that once an agent exercises his authority and the transaction binds the principal, the revocation cannot affect that transaction.
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