Bailment, as defined under Section of the Indian Contract Act, is the delivery of goods by one person to another for some purpose. Bailment is the delivery of goods by a person (the Bailor) to another (the Bailee) for a certain purpose. have been pledged by him under section 19 of the Indian Contracts Act,and the contract [1]Indian Contracts Act, In Contact, a bailment is the delivery of goods from one person to another for Section of the Indian Contract Act, deals with the topic of bailment.

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Bailment, as defined under Section of the Indian Contract Act, is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished be returned or otherwise disposed of according to the directions of the person delivering them bailor [1]. One of the key ingredients emphasized on by this definition is the delivery of possession of the goods from the bailor to the bailee. The delivery of possession may be actual or constructive.

Once the possession is handed over to the bailee, a contract of bailment arises regardless of the manner in which it was entered into. Hence, in one peculiar case, where the lady had handed over some of her jewels to a goldsmith to be utilized for making new jewels, and the lady used to take back the half-made jewels every evening for the purpose of safekeeping in her own box, the contract of bailment got over every evening as soon as the lady took the half-made jewels in her possession.

Considering bailmeny, it had become necessary for the court in the case of Atul Mehra v Bank of Maharashtra [3] to determine whether the hiring of the lockers by the plaintiffs constitutes actual delivery of possession to the defendants.

It is one of the landmark cases in India because it lays down the principle that hiring lockers at banks does not constitute a contract of bailment. It was previously talked about in some cases, and this court has upheld the principle that merely hiring a bank locker does not constitute delivery of possession which is a necessary ingredient for the contract of bailment.

It was also said by the learned Judge that in nailment to constitute a contract of bailment, the bailee must be made aware of the contents of the locker so that it can gauge the nature and extent of the security and possible liability.


The Bench, comprising of Contratc S. Nijjar, has held that exclusive baliment of the goods is sine qua non for bailment. Therefore, mere hiring of a locker would not be sufficient to constitute a contract of bailment as provided under Section of the Indian Contract Act, He has added that the question of reasonable care and quantum of damages would arise only after it has been shown that actual exclusive possession of the property was given by the bailee to the bailor, i.

Since the bank was not aware of the contents of the locker, hence it was impossible to know the quantity, quality or the value of the jewellery that was allegedly kept in the locker at the time when the robbery occurred.

Atul Mehra v Bank of Maharastra – Case Study on Bailment under the Indian Contract Act

The judge held it insufficient to prove that the appellant had entrusted the jewellery to the respondent. Learned judge has further added that the appellants alone had the knowledge of the contents of the locker. No sufficient evidence had been produced by the plaintiffs for the same.

The plaintiff thus had failed to prove entrustment of the jewellery to constitute bailment. On the argument of Mr Jaggal that the relationship between the two parties is of landlord and hirer, it was said that it cannot be said that such a relationship existed because the supposed hirer the plaintiff did not have direct access to the 8172 that he has hired and the assistance of the bank employees is required in doing so.

The judge had held that it is not per incuriam hence the same will be binding on this court. In this case, it was held that there was no exclusive possession to the bank hence no compensation was allowed to the plaintiff.

The lower courts have also relied on this judgment and the present court has established that there is no error in doing so. In another case [8] contrsct judge referred to lays down the same principle that it has to be proved that the bailor was aware of the value of the property and was entrusted with its safekeeping.

The bank, in this case, was contdact with the jewellery and the valuation of the jewellery had been proved with sufficient evidence produced to the police at the time of the robbery.

The bank was held liable for negligence because the robbery was committed by the manager within the bank itself.

The judge has asserted that the plaintiffs have miserably failed to prove the entrustment of the jewellery which was allegedly kept in the locker.


There is no proof of any kind to show the value of the jewellery which was kept in the locker. No expert witness has been produced to show that the jewellery mentioned in the plaint would be worth the amount claimed. The appeal was decided in favour of the Respondent. This judgment has laid down a crucial principle in the context of delivery of possession of goods in a contract of bailment.

It has basically laid down that the bailee must be made aware of the contents of anything he receives for safe custody so as to gauge the amount of any possible liability that may arise in the future. In this case, the bank had no knowledge of the quality, quantity or nature of goods kept inside the locker.

The court has been right in giving this decision in favor of the respondents because holding the bank responsible for the loss of any goods kept in the locker by their customers would give rise to uncountable amount of liability as it may be found difficult to prove that there was no exclusive possession of the contents of the locker.

Such uncountable liability would also discourage banks to give such a facility which is currently utilized by countless number of people around the globe.

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The judgment acts as a good precedent as it mitigates the responsibility of the banks to some extent which is absolutely required in to allow them to provide service to the public. AIR SC Parcels Ltd 1 QB Log into your account. Login with your social accounts: Enforceability of Non-Disclosure Agreements in India. Did you find this blog post helpful? Subscribe so that you acr miss another post!

Bailment, bailor and bailee | Indian Contract Act, | Bare Acts | Law Library | AdvocateKhoj

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