The Buyer Is Gone, The Goods Are Gone, And The Price Unpaid: Legal Remedies For The Unpaid Seller Under Indian Law
- IJLLR Journal
- Jun 15
- 1 min read
Aditi Tripathi, OP Jindal Global University
ABSTRACT
In the sale of goods, sellers often deliver things prior to receiving payment, so exposing themselves to considerable financial risk if the customer defaults. The Sale of Goods Act, 1930 provides a statutory framework of protections for "unpaid sellers," including rights of lien, stoppage in transit, resale, and personal remedies against the buyer. This paper critically examines the scope and efficacy of these remedies under Indian law, particularly in the context of evolving corporate practices and insolvency proceedings. The paper employs a doctrinal method to analyse significant legislative provisions (Sections 45–56), judicial interpretations, and scholarly discussion. It also contrasts the Corporate Bankruptcy and Governance Act, 2020 (CIGA), which provides more structured protections for sellers during bankruptcy, with the Sale of Goods Act, 1976. The results indicate that while Indian law offers substantial theoretical safeguards, its actual implementation becomes challenging. Contemporary logistical systems—such as third-party warehouses and computerised bills of lading— have diminished possession-based remedies; the Insolvency and Bankruptcy Code of 2016 classifies unpaid sellers as unsecured creditors, so impairing recovery. This paper proposes targeted reforms: granting sellers limited priority in bankruptcy proceedings and amending statutory provisions to align with the realities of internet commerce. The study contributes to commercial law studies by highlighting the practical discrepancies between statutory rights and enforceable remedies, while proposing a reformative approach to enhance seller protections within India's contemporary economic landscape.
