“Nemo plus iuris ad alium transferre potest quam ipse habet” rule, which means “one cannot transfer more rights than he has”

To the general rule expressed by the Maxim nemo dat quod non habet (no one can convey a better title than what he had), to facilitate mercantile transactions. the Indian Law has grafted some exceptions, in favour of bonafide pledgees by transfer of documents of title from persons. whether owners of goods who do not possess the full bundle of rights of ownership at the time the pledges are made, or their mercantile agents. To confer a right to effect a valid pledge by transfer of document of title relating to goods on persons with defects in their title to the goods. and on mercantile agents, and to deny it to the full owners thereof, is to introduce an incongruity into the Act. On the other hand, the real intention of the legislature will be carried out if the said right is conceded to the Full owner of goods and extended by construction to persons with defects in their title to the goods or to mercantile agents. A pledge being a bailment of goods under s. 172 of the Contract Act, the pledgee, as a bailee. will have the same remedies as the owner of the goods would have against a third person for deprivation of
the said goods or injury to them under s. 180 of the Act.

Indian  Contract  Act (9 of 1872), s.  178, Transfer  of Indian  Contract  Act (9 of 1872), s.  178, Transfer  ofProperty  Act (4 of 1882). ss. 4 and 137 and Indian Sale  of goods  Act (3 of 1930), ss. 30 and 53

Compare

Uniform Commercial Code (UCC) USA

Courts of equity[USA]

Sale of Goods Act 1979[UK]