Caveat Emptor – Legal Maxim

Literal Meaning

 Let the purchaser beware.


The expression is an old rule that is expected to determine debates emerging from data asymmetry, the inescapable circumstance wherein the dealer knows more than the purchaser about the nature of a decent or administration. The precept of Caveat Emptor is a vital piece of the Sale of Goods Act. It means “let the purchaser be careful”. This implies it lays their preferred obligation on the purchaser themselves. A dealer makes his merchandise accessible in the open market. The purchaser sees every one of his choices and after that as needs be settles on his decision. Presently how about we expect that the item ends up being imperfect or of second rate quality. This regulation says that the merchant won’t be in charge of this. The purchaser himself is in charge of the decision he made. So the tenet endeavors to make the purchaser increasingly aware of his decisions. It is the obligation of the purchaser to check the quality and the convenience of the item he is buying. In the event that the item ends up being faulty or does not satisfy its potential, the vendor won’t be in charge of this.


Caveat emptor is a Latin term that means “let the buyer beware.” Similar to the phrase “sold as is,” this term means that the buyer assumes the risk that a product may fail to meet expectations or have defects. In other words, the principle of caveat emptor serves as a warning that buyers have no recourse with the seller if the product does not meet their expectations.


In the event that A wants to buy a car from B, he is responsible for gathering the necessary information to make an educated purchase. He ought to ask her what number of miles it has on it, regardless of whether any major segments should be replaced, whether it’s been overhauled regularly and so on. In the event that he basically buys the car at the asking cost and makes practically no push to assess its actual value, and the car subsequently breaks down, B isn’t liable for damages under the rule of caveat emptor.

Case Reference

In the case of Mariappan v Inspector General of Registration, Department of Registration, Chennai and others[1] it was observed the petitioner ought to have purchased the property from the sixth respondent with due diligence and in common law application that led by the buyer beware or in other words “Caveat Emptor” that let a purchaser beware, for he ought not to be ignorant of the nature of the property which he is buying from another party. The buyer who ought not to be ignorant that he is purchasing the rights of another as emphasized in Law Lexicon.

In Alexander v. Automatic Telephone Co. the court held that the Court of Chancery has always exacted from Directors the observance of good faith towards their shareholders and towards those who take shares from the company and become co-adventurers with themselves and others who may join them. The maxim “caveat emptor” has no application to such cases, and Directors who so use their powers as to obtain benefits for themselves at the expense of the shareholders, without informing them of the fact, cannot retain those benefits and must account for them to the company, so that all the shareholders may participate in them.

In the case of Indrani Kailash v Debt Recovery Appellate Tribunal[2] it was observed that the contention of the petitioner was that though Kasturi Bai has given a Specific Power of Attorney to deal with the property pertaining to M/s.Shri Sai Estates, the Power of Attorney had executed Mortgage Deed against the recitals found in the Power of Attorney Deed. This contention cannot be accepted for the reason that even in the letter written by the Power of Attorney to the Bank, he has mentioned his name as Power Agent of Kasturi Bai. That apart, though the Power of Attorney Deed was executed as early as in the year 1994, the vendor of the petitioner viz., Kasturi Bai has not taken any steps to revoke the Power of Attorney. If the mortgage was created fraudulently by the Power of Attorney, the petitioner’s vendor should have taken criminal action against him for fraudulently mortgaging the property with the 3rd respondent – Bank. The petitioner also purchased the property in the year 1995 and has not taken any action against her vendor for fraudulently selling the property to her inspite of the mortgage executed by her Power Agent. The principle of Caveat Emptor shall apply to the case of the petitioner.

Edited by Vigneshwar Ramasubramania

Approved & Published – Sakshi Raje


[1] Mariappan v Inspector General of Registration, Department of Registration, Chennai and others, 2018 Indlaw MAD 13663

[2] Mariappan v Inspector General of Registration, Department of Registration, Chennai and others, 2018 Indlaw MAD 12369


I am Kousini Gupta, final year BBA.LLB. student from Symbiosis Law School, Hyderabad. The topics in Constitutional, Intellectual Property, Entertainment and Media Law excite me in particular and bring out the best in me. I have interned at District Court, High Court and several reputed law firms. The experience of these internships was highly valuable and enriching. My research and publications have been accepted in reputed national journals. Besides, I also enjoy mooting and have several participation certificates to my credit. In my free time, I like to be creative with paintings and dance to my favourite tunes.