The unpaid vendor who is in possession of  the goods, can retain such possession until the price is paid or rendered. And if the goods are partly delivered, the an exercise this right on the remaining goods except when such part delivery amounts to show that he has give up the right of lien. This right of lien extends to the whole of goods in the possession of the unpaid vendor and can be exercised only for the recovery of the price of goods but not the amounts like godown rent, incurred in storing the goods in exercise of lien for the practice.

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He can exercise the right of lien –

  • Where the goods have been sold without any stipulation as to credit
  • Where the goods have been sold on credit, but the term of credit has expired and the price remains unpaid.
  • Where the buyer becomes bankrupt

This right of lien is lost—

  • When the goods are delivered by him to a carrier, or other bailee for the purpose of transmission without reserving the right of disposal,
  • When the buyer or his agent lawfully obtains the possession of goods
  • When the unpaid vendor has given up his right of lien
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