sale of goods

The term ‘goods’ means ‘every kind of movable property other than actionable claims and money and includes stock and shares, growing crops, and things attached to or forming part of the land which are agreed to be served.  A contract of sale is a legal contract an exchange of goods, services or property to be exchanged from seller to buyer for an agreed upon value in money paid or the promise to pay same. It is a specific type of legal contract. A contract for the sale of goods is defined by the Indian Sale of Goods Act of 1930 “as a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price”.

A contract of sale is therefore agreement by which the seller either actually transfers or enters into an agreement to transfer the ownership in the goods to the purchaser for a price. A contract whereby the ownership in the goods is actually transferred from the seller to the purchaser at the time of sale is described as a “sale”. Till 1930, the law relating to sale and purchase of goods were regulated by the Indian contract act ,1872. In 1930, sections 76 to 123 of the Indian contract act, 1872 were repealed and separate act called ‘The Indian sale of goods act, 1930 was passed. It came into force on 1st July 1930. The details regarding a sale agreement are mentioned in the Sale of Goods Act of 1930 which states all the amendments and provisions related to the same. The Sale of Goods Act 1930 was laid down to define and amend the law relating to the sale of goods or movables. The act came into force on 1st July, 1930. It extends to the whole of India except Jammu and Kashmir.

Essentials of a contract of sale

 Two parties – Buyer and Seller

• Goods

 • Transfer of property

 • All Essential elements of a valid contract must be fulfilled

 • Price

• Include both sale and agreement to sell.

Effects of Destruction of Goods

In case of Contract of Sale[Section 7]- The contract of sale is void if the following three conditions are satisfied:

 • There must be a contract of sale for specific goods.

 • The goods must have become perished or so damaged as no longer to answer their description in the contract, before making of the contract.

 • The seller must not be aware about the destruction of goods.

 Example- X sold to Y all 700 bags of cement lying in his Delhi’s godown. State the legal position:

1. If unknown to X, all bags had been stolen before he contract was made.

2. If unknown to X, all cement had become stone as a result of heavy rainfall.

 3. If unknown to X, 109 bags had been stolen at the time of making the contract.

 Solution:

 Case 1- The contract is void because the goods have perished before making of the contract.

Case 2-The contract is void because the goods became so damaged as no longer to answer to their description.

 Case 3- The contract has become void and Y cannot be compelled to accept 591 bags because the contract was indivisible.

In a Madras case, — ‘Gannan Dunkerley & Co v. State of Madras’, 1954 Mad 1130 (AIR V 41) (O), the question for detemination was the meaning of the words “sale of goods” as used in Item 48 of List II and it was held that it means the contract whereby the property in the goods is wholly transferable by the seller to the buyer and it was also held that the legislative powers of a Provincial Legislature to levy a tax on the sale of goods is restricted to transactions of sale as understood by the Parliament. Sale of goods’ according to the Madras case therefore means a contract whereby the property in the goods is actually transferred by the seller to the buyer and this was also the definition given to the words “sale of goods” by the Supreme Court in — ‘Poppatlal Shah v. State of Madras’, 1953 SC 274 (275) (AIR V 40) (P), by Mukherjea J. who said: “In the legal sense, it imports passing of property in the goods and it is in this sense that the word is used in the Sale of Goods Act.”

Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.

If you are interested in participating in the same, do let me know.

Do follow me on FacebookTwitter  Youtube and Instagram.

The copyright of this Article belongs exclusively to Ms. Aishwarya Sandeep. Reproduction of the same, without permission will amount to Copyright Infringement. Appropriate Legal Action under the Indian Laws will be taken.

If you would also like to contribute to my website, then do share your articles or poems at adv.aishwaryasandeep@gmail.com

We also have a Facebook Group Restarter Moms for Mothers or Women who would like to rejoin their careers post a career break or women who are enterpreneurs

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