No seller can pass a better title than his own

The rule. Yes, as a general rule (s. 27). A buyer gets no better title than his seller had: if the seller is not the owner, and sells without the owner's authority or consent, the buyer does not become the owner either. This is the maxim nemo dat quod non habet: a person can pass on only the title he holds. It protects the true owner. Example: a thief sells a stolen bicycle to a student who pays a fair price; the student gets no title, and the owner can take the bicycle back.

Exceptions. In the following cases a buyer who acts in good faith gets a good title from a seller who is not the owner:

1. Mercantile agent (proviso to s. 27): the agent holds the goods or documents of title with the owner's consent, sells in the ordinary course of his business as a mercantile agent, and the buyer, acting in good faith, has no notice when he buys that the agent had no authority to sell. Example: a used-car dealer holding a customer's car for sale sells it below the minimum price the owner had fixed; an honest buyer keeps the car, and the owner's remedy is against the dealer.
2. Joint owner (s. 28): one of several joint owners has sole possession with the others' permission, and the buyer buys in good faith without notice that he has no authority to sell. Example: two sisters jointly own a piano kept at the elder's flat with the younger's permission; the elder sells it to an honest buyer, who gets a good title.
3. Possession under a voidable contract (s. 29): the seller obtained the goods under a contract voidable for coercion, fraud, misrepresentation or undue influence, and resells them before that contract is rescinded. Example: a buyer who obtained a camera by lying about his employment sells it to an honest buyer before the shop rescinds; the second buyer keeps it.
4. Seller in possession after a sale (s. 30(1)): a seller who still holds the goods (or documents of title) after selling them sells them again, and the second buyer takes delivery in good faith without notice of the first sale. Example: a shop sells a refrigerator, keeps it for delivery next week, and meanwhile sells and delivers it to another customer who knows nothing of the first sale; the second customer keeps it, and the first must sue the shop.
5. Buyer in possession before the property passes (s. 30(2)): a buyer who, with the seller's consent, has possession before he owns the goods sells them, and the third person takes delivery in good faith without notice of the original seller's lien or other rights. Example: a farmer takes delivery of a tractor on terms that it becomes his only on full payment, and sells it to a neighbour before paying; the neighbour, acting honestly, gets a good title.
6. Unpaid seller's resale (s. 54(3)): an unpaid seller who has exercised his lien or right of stoppage and then resells gives the new buyer a good title as against the original buyer.
7. Estoppel: where the true owner, by his conduct, has led the buyer to believe that the seller owns the goods or may sell them, he cannot later deny the seller's authority. Example: an owner who signs a note saying that his nephew owns the car cannot reclaim it from a buyer who relied on the note.
8. Sales under other Acts: a sale by an Official Receiver or a company's liquidator, a sale by a finder of goods in the circumstances the Contract Act allows, and a sale by a pawnee on the pawnor's default all pass a valid title.

Conclusion. I agree with the statement as the general rule; the exceptions protect honest buyers, mainly where the owner has let someone else hold the goods or appear to have authority to sell them.