Sale of Goods Act (1) Final

7/30/2019 Sale of Goods Act (1) Final

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Submitted by:-Anshul Khandelwal (B-012)Vinamra Khemuka (B-013)Dipesh Patel (B-026)

Monank Patel (B-027)Akash Sharda (B-037)Siddharth Shinde (B-040)

Sale of Goods Act 1930



• Initially, this was part of Indian Contract Act.

• In 1930 separate Sale of Goods Act was passed.

• Sale of Goods Act is an old mercantile law

• Deals only with sale of movable goods

INTRODUCTION



Contract of Sale• A contract whereby the seller transfer or agrees

to transfer the property in goods to the buyer fora price.

•

Essentials – Two parties – Goods – Transfer of ownership – Price – All essentials for a valid contract of sale – Includes both a ‘sale’ and ‘agreement to sell’.





• Goods- every kind of movable property, other thanactionable claims and money. It includes stock,shares, growing crop, grass and things attachedto or forming part of land.

– Existing goods• Specific• Ascertained•

Unascertained – Future goods – Contingent goods

Classification of Goods



• Existing goods – that are physically present at thetime of sale.

–

Specific : Goods identified and agreed upon at thetime of making the contract of sale are specific goods.

– Ascertained : The goods that have been ascertained oridentified subsequent to the formation of the contractof sale. It basically involves unconditionalappropriation of the goods.

– Unascertained : The goods that are not specificallyidentified or ascertained at the time of entering thecontract of sale. They are identified or defined only bydescription.







• Price expressly fixed in the contract itself : Theprice in a contract of sale may be expresslyfixed by the parties themselves.

• Price fixed by the valuation of a third party:When there is an agreement to sell goods onthe terms that the price is to be fixed by thevaluation of a third party.



Bailment• Bailment- A transaction in which goods are

delivered by one person to another person for aspecific purpose upon a contract that they will be

returned or disposed after the purpose isaccomplished.• Difference between sale and bailment.

– Title and position – Return of goods – Right to goods – Act applicable section 148(bailment),



Hire-Purchase• Hire-Purchase - A contract of hiring under which

owner delivers his good on lease to a person andalso gives hirer an option to purchase the goods

at the end of hiring period.• Difference between sale and Hire-Purchase

– Transfer of ownership – Right to terminate the contract – Mode of Contract – Act Applicable – Insolvency of the buyer





• Expressed Condition- Any condition that hasbeen expressly provided by both the parties at

time of sale. – Parties can include any number of expressed

condition. –

For ex. If A desires to buy a 15” laptop then thescreen size is an expressed condition.• Implied Condition-

– Condition as to title – Condition as to description and/or sample – Condition as to wholesomeness





CONDITION WARRANTY

NatureIt is essential to the mainpurpose of the contract

It is a collateral to the mainpurpose of the contract

effect of breachAgrieved party can repudiate

the contractAgrieved party can claim the

damages

ImportanceVital part for completion of

contractThe contract can be completed

even if warranty is not completed

TreatmentBreach of condition can be

treated as breach of warrantyif the agrieved part agrees

Breach of warranty can not betreated as breach of Condition

Example

A tells B that he wants to buy acar which is capable of making

a speed of 150 k/p/h, but if itis found that the car does notmake a speed of 150 k/p/h, Acan repudiate the contract

A at the time of selling his car to Btells him that it is capable of

making a speed of 150 k/p/h.After purchased the car that it cankeep up hardly 100k/p/h, thebreach of the representation bythe seller amounts to a breach of warranty.



Doctrine of caveat emptor

• ‘C aveat emptor’ means ‘buyer be aware’. Buyer isexpected to be careful while purchasing the goods andseller is not liable for any defects in goods sold by him.

• Under of Sale of Goods Act and any other law, there isno implied condition or warranty as to quality orfitness of goods for any particular purpose.

Exceptions1. False representation by seller amounting to fraud.2. Buyer relying upon the skill of the seller Priest v. Last.3. Goods supplied do not correspond to the sample



Rights of Unpaid Seller

• A seller is unpaid when:- – Goods have been sold and price is overdue. – Full price has not been paid or tendered to seller. – Negotiable instrument are conditional or have

been dishonored.

Rights of an unpaid seller are classified as:-Rights against the goodsRights against the buyer



Rights against theGoods

• Right of lien orretention

• Right of stoppage of goods in transit

•

Rights of resale• Right to withhold

delivery

Rights against theBuyer

• Suit For Price• Suit for damages for non

acceptance• Suit for damages for

repudiating contractbefore due date

• Suit for interest andspecial damages



Buyer’s Right against the Seller

• Suit for damages for non delivery•

Suit for specific performance• Suit for damages for breach of warranty• Suit for damages for Rescission of contract

before due date• Suit for recovery of price along with interest



AUCTION SALE

Public event at which goods are sold to the person whooffers the highest price(bid).

Rules Regarding Sale by Auction:-•

Each lot of goods is separate sale of contract• Sale is completed by the fall of hammer• Puffer• Sale may be notified to be subject to reserve price•

Right to bid may be reserved expressly by or on behalf of the seller.

• Auctioneer – can sell on behalf of seller, has noknowledge of defect in title & can give quiet

possession of goods on payment of price.



Transfer of Ownership

• Significance – Risk ”Prima Facie” passes with ownership

• Ex. A hires a van from B, which accidently catches fire.

The loss would be borne by B – Action against third party – Suit for price –

Insolvency of buyer and seller



• Rules Regarding transfer of ownership – Transfer of ownership in ascertained goods – Transfer of ownership in unascertained goods – Transfer of ownership in goods sent “on approval”

or “on sale or return” basis

• Transfer of ownership in ascertained goods – The ownership transfer if the following conditions

are satisfied• Goods are specific• Contract is unconditional• Goods are in deliverable state



• Transfer of ownership in unascertained goods – The ownership does not pass unless the following

conditions are fulfilled• Ascertainment of goods• Their appropriation to the contract

• Transfer of ownership in goods sent “on approval” or “onsale or return” basis

– The ownership transfer under the following conditions• The buyer signifies the approval to the seller• The buyer does not retains the goods without informing the

seller, then on expiration of reasonable time the ownershiptransfers to the buyer



THANK YOU

Sale of Goods Act (1) Final

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