Section 15 in The Warehousing (Development and Regulation) Act, 2007

Title: Warranties on negotiation of warehouse receipts

Description: A person who, for valuable consideration, negotiates a negotiable warehouse receipt by endorsement and delivery, including one who assigns for valuable consideration, a claim secured by a receipt, unless a contrary intention appears, warrants the following:-- (a) that the receipt is genuine; (b) that the person has a legal right to negotiate or transfer it; (c) that the person has no knowledge of any fact that would impair the validity of the receipt; (d) that the person has a right to transfer the title to the goods; and (e) that the goods are merchantable or fit for a particular purpose when those warranties would have been implied, if the contract of the parties had been to transfer without a receipt the goods represented by it.

Title: Non-liability of the endorser

Description: The endorsement of a receipt does not make the endorser liable for any failure on the part of the warehouseman or previous endorsers of the receipt to fulfil their respective obligations.

Title: Negotiation of warehouse receipt not impaired by fraud, mistake or duress

Description: The validity of the negotiation of a receipt is not impaired by the fact that— (a) the negotiation was a breach of duty on the part of the person making the negotiation; or (b) the owner of the receipt was induced by fraud, mistake or duress to entrust the possession or custody of the receipt to that person, if the person to whom the receipt was negotiated or a person to whom the receipt was subsequently negotiated, paid value for it without knowing of the breach of duty, fraud, mistake or duress.

Title: Subsequent negotiation of warehouse receipts

Description: If a person having sold, mortgaged or pledged goods that are in the custody of a warehouseman and for which a negotiable receipt has been issued, continues in possession of the negotiable receipt, the subsequent negotiation of it by that person under any sale or other disposition of the goods to any person receiving the receipt in good faith, for valuable consideration and without notice of the previous sale, mortgage or pledge, has the same effect as if a previous purchaser, mortgagee or pledgee of the goods, as the case may be, had expressly authorised the subsequent negotiation.

Title: Delivery of goods to be made after due charges are paid

Description: When a negotiable warehouse receipt has been issued in respect of any goods, the warehouseman shall not deliver the goods to the depositor or endorsee, until the due charges are paid to the custodian from the date of initial deposit till delivery is made and the warehouse receipt is surrendered for cancellation.

CHAPTER 4 WAREHOUSE RECEIPTS