This document discusses the key aspects of a contract of sale of goods under Indian law. It defines a contract of sale as one where the seller transfers ownership of goods to the buyer for a price. A contract of sale must have two parties, involve the sale of movable goods, and include the transfer of property rights and payment of a price. Goods can be existing, future, or contingent. Exceptions to the rule that a seller can only transfer the title they possess include sales by agents or joint owners.

1. CONTRACT OF SALE OF GOODS
CLASSIFICATION OF GOODS
Prepared By:
Divyanshu soni

2. NATURE OF CONTRACT OF SALE OF GOODS :
 This law is related to sale of goods prior to
july 1,1930 the sale of goods act ,1930 was
enacted which came into effect from july 1
1930.This act is applicable to whole of india
except the state of Jammu and Kashmir this
law is related to the sale of movable goods is
contained in sale of goods act

3. FORMATION OF CONTRACT OF SALE :
What is a contract of sale
Section 4 of the sale of goods act provides
that "A contract of sale of goods is a contract
whereby the seller transfers or agress to
transfer the property in goods to the buyer for a
price ."This section further ,provides that there
may be a contract of sale between one part
owner and another .A contract of sale may be
absolute or conditional according to the desire

4. A CONTRACT OF SALE MAY BE EITHER
1.A SALE
2.AN AGREEMENT TO SELL
Where under a contract of sale the property in the
goods is transferred from the seller to the buyer
this is called as sale. But where the transfer of
the property in the goods is to take place at a
future time or subject to some condition
thereafter to be fulfilled the contract is called an
agreement to sell.
EXAMPLE X makes a contract with Y to sell 200
ready made garments from his shop for Rs
3000.X authorizes Y to come to his shop during
business hours and take away the garments
whenever it suits to him .it amounts to sale

5. ESSENTIAL ELEMENTS OR FEATURES OF A
CONTRACT OF SALE :
1.Two parties: In a contract of sale the ownership
of the goods has to pass from one person to
another .there must be two parties in such a
contract ,one seller and the other buyer.
2. Subject matter of sale must be goods : the
subject matter of a contract of sale must be
goods and the goods must be movable.
3. Transfer of 'property ' in the goods: property
here means ownership or title of the goods .In
every contract of sale ,the ownership of the
goods must be transfered by the seller to the
buyer.

6. ESSENTIAL ELEMENTS OR FEATURES OF A
CONTRACT OF SALE :
4.price: price means money consideration for a sale of
goods .in a contract of sale ,a price in money ,and not
in kind ,must be paid or be promised to be paid .
5. Absolute or conditional :A contract of sale may be
absolute or conditional .under absolute contract of
sale ,the seller transfers or agrees to transfer the
property in goods for a price .without being contingent
or dependent on any special conditions .
6. Essential elements of contract :A contract of sale
being a contract must fulfill all the requirement of a
valid contract .

7. ESSENTIAL ELEMENTS OR FEATURES OF A
CONTRACT OF SALE :
7. 'Sale ' or agreement to sell' both are
included: In a contract of sale ,both 'sale ' and
'agreement to sell' are included
8.Form : A contract of sale may be made in
writing or word of mouth, or partly in writing and
partly by words of mouth or may be implied from
the conduct of the parties .
9. Formalities : according to section 5 of the sale
of goods act a contract of sale is made by an
offer to buy or sell goods for a price and the
acceptance of such offer.

8. CLASSIFICATION OF GOODS:
The goods which forms the subject-matter of contract
of sale, can be of the following kinds or types :
1. Existing goods
 Specific goods
 Ascertained goods
 Unascertained goods
2. Future goods
3. Contingent goods

9. EXISTING GOODS :
Existing goods are those, which are owned or
possessed by the seller at the time of contract.
Instances of sale of goods possessed but not
owned by the sellers fire sales by agents and
pledgees. The existing goods may be of the
following :
 Specific goods : The goods which stand
identified and agreed upon at the time when the
contract of sale is made, are called ‘specific
goods’[section 2(14)of sale of goods act ].

10. EXISTING GOODS :
 Ascertained goods : When out of mass or heavy
or large number or large quantity of unascertained
goods ,the number or quantity contracted for is
identified and set aside for such contract ,such
number or quantity is said to be ‘ascertained
goods’.
 Unascertained goods : The goods which are not
specifically identified and agreed upon at the time
when the contract of sale is made, are called
‘unascertained goods’. They are defined only by
description and may from part of a lot (i.e., the
whole number or quantity).

11. FUTURE GOODS :
Those goods which are yet to be manufactured
or produced or acquired by the seller after
making the contract of sale, are called ‘future
goods’. Thus, future goods are not in
existence at the time of the contract of sale,
or if they are in existence then they have not
yet been acquired by the seller by that time.

12. CONTINGENT GOODS :
As per section6(2)of the act, contingent goods
are those goods the acquisition (acquiring) of
which by the seller depends upon a
contingency(uncertain event) which may or
may not happen. They are also a type of
future goods and therefore a contract for sale
of contingent goods operate as ‘an
agreement to sell.’

13. WHAT IS MEANT BY THE TERM “ TITLE “ ?
‘Property’ means ownership, while ‘title’ means
right to ownership. From another angle ‘title’ is
a qualified ownership.
The term ‘title’ is usually used to denote a
claim or right to ownership which means an
assertion of right to ownership.

14. TRANSFER OF TITLE BY NON-OWNERS :
 There is a Latin maxim ‘Nemo dat quod non
habel’ which means that “No one can give what
he himself has not.” That is, no can give to
another person a title better than what he
himself has.
In this context, Section 27 of Sale of Goods Act
lays down that where the goods are sold by a
person who is not owner thereof and who does
not sell them under the authority or with the
consent of the owner, then the buyer does not
acquire better title to the goods than what the
seller has.

15. TRANSFER OF TITLE BY NON-OWNERS :
For example, in such a case if the seller is a thief than
his buyer will also be treated as a thief in connection
with the goods purchased. Thus, if a person deals with
the goods of another without the owner's authority or
without his consent , he does not convey absolute
ownership to the buyer. The buyer in that case remains
a qualified ownership and he acquires similar title in the
goods as the seller himself had.
For example, X finds a necklace of Y on the road and
sells it to Z who buys in good faith and for value. Here,
the true owner Y can recover the necklace from Z
because X has ‘no title’ to the necklace and therefore
he passes ‘no title’ to Z. Thus, if the title of the seller is
defective, the title of buyer will also be suffering from
the same.

16. EXCEPTIONS :
1. Title by estoppels : When the owner of the
goods, by his statement or conduct, lead the buyer
to believe that the seller has the authority to sell,
then subsequently he may be estopped from
denying the sellers authority to sell.
2. Sale by joint owner : Section 28 of Sale of Goods
Act provides that if one of the several joint owners
of certain goods has the sole possession of the
goods by permission of the other co-owners, the
property (ownership) is transferred to any person
who buys such goods from such joint owner.

17. EXCEPTIONS :
3. Resale by an unpaid seller : An unpaid seller
who has exercised his right Lieberman or
stoppage in transit resells the goods, the buyer
acquires a good title thereto as against the
original buyer whether the notice of resale has
been given to the original buyer or not.
4. Sale by agent : A mercantile makes a sale of
the goods or of a document of Title to the goods,
he shall pass a valid title to the buyer or the buyer
gets a better title.

18. EXCEPTIONS :
5. Sale by seller in possession of Goods
after sale : When a person, who has sold
the goods but continues to be in possession
of them or of the documents of Title of them ,
resells such goods or documents, then a
third person will get a good title if he buys
them in good faith and without any notice of
the previous sale.

19. Thank you!