Section 175 of Indian Contract Act, 1872 - Pawnee's Right as to Extraordinary Expenses Incurred

Section 175 of the Indian Contract Act, 1872 deals with the right of a pawnee to recover extraordinary expenses incurred for preserving goods that have been pledged.

Text of Section 175

175. Pawnee's right as to extraordinary expenses incurred.
The pawnee is entitled to receive from the pawnor extraordinary expenses incurred by him for the preservation of the goods pledged.

Meaning of Section 175

A pledge is a form of bailment in which goods are delivered as security for payment of a debt or performance of a promise. Under Section 172, the bailment of goods as security is called a pledge; the bailor is called the pawnor, and the bailee is called the pawnee.

Section 175 protects a pawnee who has to incur expenses beyond ordinary custody or care in order to preserve the pledged goods. When such extraordinary preservation expenses are actually incurred, the section entitles the pawnee to receive those expenses from the pawnor.

Essential Requirements

There must be a valid pledge of goods.
The claimant must be the pawnee and the person liable must be the pawnor.
The expenditure must be extraordinary rather than merely routine expenditure connected with ordinary possession or custody.
The expenditure must have been incurred for preservation of the pledged goods.
The amount claimed should be capable of being supported by the facts and evidence relating to the expenditure.

Section 175 and Pawnee's Right of Retainer

Section 173 separately deals with the pawnee's right to retain pledged goods for the debt or promise, interest on the debt, and necessary expenses incurred in respect of possession or preservation of the goods. Section 175 specifically addresses extraordinary expenses incurred for preservation of the pledged goods and gives the pawnee a right to receive those expenses from the pawnor.

Illustrative Example

If pledged goods face an unexpected risk of serious deterioration and the pawnee reasonably incurs exceptional expenditure solely to preserve those goods, Section 175 may support recovery of that extraordinary preservation expenditure from the pawnor. Whether an expense is extraordinary and recoverable will depend on the facts of the transaction and the nature and necessity of the expenditure.

Legal note: Section 175 should be read with the surrounding pledge provisions, particularly Sections 172 to 177 of the Indian Contract Act, 1872. The exact legal consequence in a dispute depends on the pledge terms, the nature of the goods, the expenditure incurred, and the available evidence.

Related Provisions on Pledge

Section 172 - Pledge, pawnor and pawnee defined
Section 173 - Pawnee's right of retainer
Section 174 - Retention for other debt or promise and subsequent advances
Section 176 - Pawnee's right where pawnor makes default
Section 177 - Defaulting pawnor's right to redeem

Official Source

The Indian Contract Act, 1872 is a Central Act administered through the Ministry of Law and Justice, Legislative Department. For the official consolidated Act and section list, refer to India Code.

India Code - The Indian Contract Act, 1872

This page is intended for general legal information. For a particular transaction or dispute, the applicable documents, facts, amendments and judicial decisions should be examined.