The document provides an overview of key concepts from the Sale of Goods Act 1930 in India, including: 1. It defines important terms like "sale", "buyer", "seller", and "goods" as used in the Act. Goods can be existing, future, or contingent. 2. It distinguishes a sale from an agreement to sell based on factors like nature, type of contract, transfer of risk and title, right to sell, and consequences of loss. 3. Essentials for a valid contract of sale are outlined as two or more parties, agreement to transfer ownership of goods for a price, and subject matter being goods. 4. Rules regarding passing of property, performance of

1. Sale of Goods Act 1930
UNIT-II
Sale of goods Act 1930
Dr.D.Joel Jebadurai
AP, MBA, SJCE

2. Important terms in sale of goods
act 1930
Sale
1. It is a contract where the ownership in the goods
is transferred by seller to the buyer immediately
at the conclusion contract. Thus, strictly
speaking, sale takes place when there is a
transfer of property in goods from the seller to
the buyer. A sale is an executed contract.
2. It must be noted here that the payment of price is
immaterial to the transfer of property in goods.
Buyer- As per the sec 2(1) of the Act, a buyer is someone
who buys or has agreed to buy goods.
Seller- The Act defines seller in sec 2(13). A seller is
someone who sells or has agreed to sell goods.

3. Goods
Goods - Every kind of movable property other than actionable
claims and money; and includes stock and shares, growing
crops, grass, and things attached to or forming part of the
land which are agreed to be severed before sale or under the
contract of sale will be considered goods”
Types of goods :
1. Existing goods- Specific goods, Ascertained goods,
Unascertained goods
2. Future goods
3. Contingent goods

4. Types of goods
• Existing goods
It means the goods which are either owned or possessed by the seller
at the time of contract of sale.
a. Specific goods- These are the goods that are identified and agreed
upon at the time when a contract of sale is made.
b. Ascertained goods- Goods are said to be ascertained when out of
the mass of unascertained goods, the quantity extracted is
identified and set aside for a given contract.
c. Unascertained goods – These are the goods that are not identified
and agreed upon at the time when a contract of sale is made.
2. Future goods- It means goods to be manufactured or produced or
acquired by the seller after making the contract of sale. There can be
an agreement to sell only.
3. Contingent goods- These are the goods the acquisition of which the
seller depends upon a contingency which may or may not happen.

5. Distinguish Sale and Agreement to Sell
BASIS SALE AGREEMENT TO SELL
Meaning When in a contract of sale, the
exchange of goods for money
consideration takes place
immediately, it is known as Sale.
When in a contract of sale the parties to
contract agree to exchange the goods for
a price at a future specified date is
known as an Agreement to Sell.
Nature Absolute Conditional
Type of Contract Executed Contract Executory Contract
Transfer of risk Yes No
Title In sale, the title of goods transfers
to the buyer with the transfer of
goods.
In an agreement to sell, the title of goods
remains with the seller as there is no
transfer of goods.
Right to sell Buyer Seller
Consequences of
subsequent loss or
damage to the
goods
Responsibility of buyer Responsibility of seller
Tax VAT is charged at the time of sale. No tax is levied.
Suit for breach of
contract by the
The buyer can claim damages
from the seller and proprietary
Here the buyer has the right to claim
damages only.

6. Essentials for contract of sale
(Section 4) A contract of sale of goods is a contract
whereby the seller transfers or agrees to transfer the
property in goods to the buyer for price".
1. There must be at least two parties
2. Transfer or Agreement to transfer the
ownership of goods.
3. The subject matter of the contract must
necessarily be 'goods'.
4. The consideration is Price.
5. A Contract of sale may be in writing or by words
6. All other essentials of a valid contract must be
present

7. Document of title to goods
From the Sec 2(4) of the act, we can say that this
“includes the
a. Bill of lading,
b. Dock-warrant,
c. Warehouse keeper’s certificate
d. Railway receipt,
e. Multimodal transport document
f. Warrant or order
for the delivery of goods and any other document used
in the ordinary course of business as proof of the
possession or control of goods or authorizing or
purporting to authorize, either by endorsement or by
delivery, the possessor of the document to transfer or
receive goods thereby represented.”

8. Documents of title to goods
1. A document of title to goods is a document representing
goods and is used—
- in the ordinary course of business
- as proof of the ownership, possession or control of goods.
It authorises the possessor of such document to receive or transfer the
goods represented thereby
1. Document of title is a document, which is the evidence of full
ownership of goods represented by the document.
2. Delivery of document of title is as good as giving delivery of goods.
3. Transfer of document of title is a symbolic delivery of goods to the
purchaser.
4. The document of title to goods is transferred by endorsement or by
mere delivery and it confers a good title to the transferee if he receives
it in good faith. E.g. Delivery of railway receipt is enough to constitute
delivery of goods represented by railway receipt.

9. Conditions and Warranty
Express
Conditions
Implied Conditions
Condition as to
title
Sale by
description
Sale by sample
Condition as to quality
or fitness
Condition as to merchantable
quality
Condition implied by
customer
Conditions as to
wholesomeness
Implied Warranties
Condition as to
quite possession
Warranty against
encumbrance
Warranty to disclose
dangerous nature of
goods
Warranty as to quality
fitness by usage of trade

10. BASIS FOR
COMPARISO
N
CONDITION WARRANTY
Meaning
It is a stipulation which
forms the very basis of
the contract.
It is additional
stipulation
complementary to the
main purpose of the
contract.
Provision
Section 12(2) of the Sale
of Goods Act, 1930
defines Condition.
Section 12(3) of the
Sale of Goods Act,
1930 defines
Condition.
Purpose
Condition is basic for the
formulation of the
contract.
It is a written
guarantee for assuring
the party.
Result of
Breach of
Contract
The whole contract may
be treated as repudiated.
Only damages can be
claimed in case of a
breach.

11. BASIS FOR
COMPARISON
GUARANTEE WARRANTY
Meaning The guarantee serves as a promise
made by the manufacturer, to the
buyer, that in case the product
below quality, it will be repaired,
replaced or the money deposited
will be refunded.
Warranty is a written
assurance that the facts
specified in the product is true
and genuine, but if they are
not it will be repaired or
replaced.
What is it? Commitment Assurance
Applicable to Product, service and persons. Product only.
Condition of sale May or may not be a condition of
sale
Subsidiary condition of sale,
which may be expressed or
implied.
Validity It can either be oral or written. It is generally written and so it
is easy to prove.
Cost Free of cost The buyer has to pay for
warranty.
Term Varies from item to item Long term
Money back (in Yes No

12. Doctrine of caveat emptor
• It means Let the buyer beware.
Exceptions
1. In case of misrepresentation by the seller
2. In case of concealment of latent defect
3. In case of sale by description
4. In case of sale by sample
5. In case of a sample as well as a description
6. Fitness for a particular purpose
7. Merchantable quality

13. Rules relating to passing of property from seller to buyer
1Rules relating to the transfer of ownership of specific or ascertained goods-[ Sec 19 - 22]
The ownership is transferred immediately at the time of making the contract if all the following conditions
are satisfied: .
a. The contract is for the specific goods. .
b. The goods are in a deliverable state. .
c. The goods are not required to be weight or measured for determining price.
2 Rules relating to the transfer of ownership of unascertained goods or future goods-sec [18 and 23]
Unascertained goods means goods which have not been identified and agreed upon at the
time when contract of sale is made. The ownership of unascertained goods is transferred to
the buyer when the following condition are satisfied: .
The goods must have been ascertained. .
The goods must have been unconditionally appropriated by the seller or the buyer. .
The contract to sell unascertained goods is not a complete sale. It is the agreement to sell.
3. Rules relating to the transfer of ownership of goods sale on approval or on sale or return basis—
The term sale on approval basis may be defined as the sale in which the buyer may return the
goods within reasonable time. This is also known as sale on return basis. It means the buyer
has the option either to return or retain the goods. Here, the property in goods does not pass
from the seller to the buyer.

14. TRANSFER OF TITLE BY NON - OWNERS
General rule- NEMO DAT NON HABET
• -No one can give that which has not
• -To protect property rights
Exceptions
1. Transfer of title by Estoppel [Sec 27]
2. Sale by mercantile agent [Sec 27]
3. Sale by Joint owners.[ Sec 28]
4. Sale by a person in possession under voidable contract.[Sec 29]
5. Sale by a seller in possession after sale.[Sec 30 (1)]
6. Sale by a buyer in possession before the transfer of
ownership.[Sec 30 (2)]
7. Sale by an unpaid seller [Sec 54]

15. Performance of contract of sale
1. The Duty of the Buyer and Seller
(Section 31)
2. Concurrency of Payment and
Delivery (Section 32)

16. The Duty of the Buyer and Seller (Section 31)
Rights of the Seller (Section 31)
• He can reserve the rights of the goods until and unless
payment of goods is done.
• He can assume that the buyer has accepted the
goods or not.
• He will only deliver the goods when the buyer would
apply for the delivery.
• He can make the goods delivered in instalments when
so agreed by the buyer.
• He can have the possession of the goods until the
buyer hasn’t paid for the goods.
• He can stop the delivery of goods and resume
possession of the goods unless and until the payment
is done for the goods.
• He can resell the goods under certain conditions.

17. Duties of seller
1. He should make an arrangement for the transfer of property to the buyer.
2. He should check whether the goods are delivered properly or not.
3. He should give a proper title to the goods which he has to pass to the
buyer.
4. He should deliver the goods according to the terms of the agreement.
5. He should ensure that the goods supplied should be agreed to the implied
condition and warranties.
6. He should keep the goods in a deliverable state and deliver the goods
when the buyer asks for it.
7. He should deliver the goods within a specific time fixed in the contract.
8. He should bear all the expenses for which the good should be delivered.
9. He should deliver the goods as said by the buyer in the contract in an
agreed quantity.
10. To deliver the goods in instalments only when the buyer wants.

18. Rights of the Buyer (Section 31)
1. He should get the delivery of the goods as per contract.
2. He can reject the goods if the quality and quantity are not as specified in the contract.
3. To deny the contract when goods are delivered in instalments without any agreement
to the effects.
4. The seller should inform him when the goods are to be sent by sea route, so that the
buyer may arrange for their insurance.
5. He can examine the goods for checking whether they are in the agreement with the
contract.
6. If he has already paid he can sue the seller for recovery of the price if the seller fails to
deliver the goods.
7. He can also sue the seller for damages or the seller’s wrongful neglect or the seller
refuses to deliver the goods to the buyer.
8. He can sue the seller for damages for breach of a warranty or for breach of a condition.
9. He can sue the seller for the damages of breach of contract.

19. Duties of the Buyer
1. He should accept the delivery of goods when the seller is prepared to
make the delivery as per the contract.
2. To have possession on it he should pay the price for the goods as per the
contract.
3. He should apply for the delivery of the goods.
4. He can ask to deliver the goods at a particular time.
5. He should accept delivery of the goods in instalments and pay for it
according to the contract.
6. He should bear the risk of failure of delivery of goods if the delivery
point is a distant place.
7. He should pay the price on the transfer of possession of the goods as
given in the term of the contract.
8. He has to pay for not accepting the goods.

20. Delivery
1. Actual
2. Constructive
3. Symbolic

21. Rules as to Delivery
1. Delivery (Section 33) means voluntary transfer of possession from one person to another;
2. Effect of part-delivery (Section 34)
3. Buyer to apply for delivery (Section 35)
4. Place of delivery [Section 36 (1)]
5. Time of Delivery [Section 36 (2)]
6. Goods in possession of a third party [Section 36 (3)]
7. Time for tender of delivery [Section 36 (4)]
8. Expenses for delivery [Section 36 (5)]
9. Delivery of wrong quantity (Section 37)
10. Installment deliveries (Section 38)
11. Delivery to carrier [Section 36 (1)]
12. Deterioration during transit (Section 40)
13. Buyers right to examine the goods (Section 41)
14. Acceptance of Delivery of Goods (Section 42)
15. Return of Rejected Goods (Section 43)
16. Refusing Delivery of Goods (Section 44)

22. Unpaid seller
• unpaid seller is a person who has not been paid yet either by
cash or other negotiable instruments.
The following conditions must be fulfilled before a seller of
goods can be deemed to be an unpaid seller:
• 1. He must be unpaid and the price is due.
• 2. He must have an immediate right of action for the price
• 3. A bill of exchange or other negotiable instrument was
received but the same has been dishonored.

23. Rights of Unpaid seller