The term 'Bailment', is derived from a French term 'Bailor' which means "to deliver or handing over". A Bailment is the delivery of goods by a person to another for definite purpose, in the condition that after the purpose is accomplished; the goods have to be returned. Bailment is the change of possession of goods, not a transfer of ownership of goods as in sale. The common illustrations of bailment are hiring of goods, furniture or cycle etc. Delivering of cloth to a tailor for making suit, delivering a car or scooter for repairing and delivery dress to dry cleaner are the example of bailment.

According to Section 25 of Nepal Contract Act, 2056, "a contract relating to bailment shall be deemed to have been concluded in case any person delivers any property to another person on a returnable basis or for handing it over to any other person or selling it as ordered by him."

According to Section 148 of Indian Contract Act, 1872, "a bailment is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them."


If a person gives some property to another person upon a contract that it shall be returned to him or otherwise disposed off or sold out according to the order of the person delivering it, the contract is said to be the contract of bailment. Thus a bailment is a delivery of goods on condition that the recipient shall ultimately restore them to Bailor or dispose of them according to the directions of the Bailor.