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Business Law Print 1

The Sale of Goods Act, 1930 establishes a legal framework for contracts of sale in India, defining the rights and duties of buyers and sellers, including the transfer of ownership and payment. It outlines key provisions such as conditions and warranties, remedies for breach, and the performance of contracts, ensuring fair dealing and protection of interests for both parties. The Act also harmonizes with international standards and provides mechanisms for dispute resolution.
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0% found this document useful (0 votes)
24 views1 page

Business Law Print 1

The Sale of Goods Act, 1930 establishes a legal framework for contracts of sale in India, defining the rights and duties of buyers and sellers, including the transfer of ownership and payment. It outlines key provisions such as conditions and warranties, remedies for breach, and the performance of contracts, ensuring fair dealing and protection of interests for both parties. The Act also harmonizes with international standards and provides mechanisms for dispute resolution.
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The Sale of Goods Act, 1930, a contract of sale is a legal agreement where one party (seller) agrees to transfer

ownership of goods to another party (buyer) in exchange for a price. The contract of sale can be for specific goods Objectives of The Sale of Goods Act,1930:• To provide a legal framework for the sale of
or for future goods that are yet to be manufactured or acquired by the seller.A contract of sale may be in writing, goods: The act provides a legal framework for the sale of goods in India. It defines the rights
oral, or implied from the conduct of the parties. The essential elements of a contract of sale include the agreement and duties of the buyer and seller in a contract for the sale of goods and provides for the
to sell, transfer of ownership, and payment of price.The agreement to sell includes the terms and conditions of the transfer of property in goods.• To protect the interests of buyers and sellers: The act seeks to
sale such as the description of goods, quantity, quality, price, delivery date, and mode of payment. The transfer of
protect the interests of both buyers and sellers in a contract for the sale of goods. It provides
ownership in goods occurs when the seller transfers the property in goods to the buyer, either at the time of the
for implied conditions and warranties, which ensure that the goods are of merchantable
contract or at a later time as agreed between the parties. The payment of price is the consideration for the
transfer of ownership in goods. Key provisions of the Sales of goods act,1930: • Definition of a Contract for Sale:
quality, fit for the purpose for which they are sold, and correspond with their description.• To
A contract for sale is an agreement between the buyer and the seller for the transfer of ownership of goods for a promote fair dealing in commercial transactions: The act seeks to promote fair dealing in
price. • Conditions and Warranties: The act distinguishes between conditions and warranties in a contract for commercial transactions. It provides for remedies in case of breach of contract, which include
sale.Conditions are essential terms of the contract, and their breach entitles the innocent party to terminate the the right to reject the goods, claim damages, and terminate the contract.• To provide for
contract. Warranties are subsidiary terms, and their breach entitles the innocent party to claim damages, but not efficient resolution of disputes: The act provides for efficient resolution of disputes arising out
to terminate the contract.• Transfer of Property: The act provides for the transfer of property in goods from the of a contract for the sale of goods. It allows parties to opt for alternative dispute resolution
seller to the buyer. The transfer of property is essential for the passing of the ownership of goods.• Sale by
mechanisms such as arbitration and mediation.• To harmonize with international standards:
Description and Sample: The act recognizes the sale of goods by description and sample. The buyer has the right
The act seeks to harmonize with international standards for the sale of goods. It is based on
to reject the goods if they do not conform to the description or sample.• Implied Conditions: The act implies
certain conditions in a contract for sale, such as the seller having the right to sell the goods, and the goods being of
the principles of the English Sale of Goods Act, 1893 and the United Nations Convention on
merchantable quality.• Performance of the Contract: The act provides for the performance of the contract, Contracts for the International Sale of Goods (CISG).
including the delivery of goods, payment of the price, and the passing of property in the goods.• Remedies for
Breach: The act provides for remedies in case of breach of contract, such as termination of the contract, claim for
damages, and the right to reject the goods.

Condition is a term of the contract that is essential to the main purpose of the contract. It is a fundamental term that
goes to the root of the contract. If a condition is breached, the aggrieved party can treat the contract as repudiated and
Sale and Agreement to sell: Under the Sale of Goods Act, 1930, a contract of sale can be either a can claim damages for breach of contract. The aggrieved party can also refuse to accept the goods or return the goods if
sale or an agreement to sell. The main difference between the two is that in a sale, the they have already been delivered. Kinds Under the Sale of Goods Act, 1930, the conditions of a contract of sale can be
ownership of goods is immediately transferred from the seller to the buyer, while in an categorized into the following two kinds: 1. Express conditions: These are the conditions that are explicity agreed upon
agreement to sell, the transfer of ownership is to take place at a future date or on the happening by the parties and are included in the contract of sale. Express conditions can be oral or written. For example, if the
parties agree that the goods must be delivered by a certain date, that becomes an express condition of the contract. 2.
of a certain event.In a sale, the goods are identified and agreed upon by both parties, and the
Implied conditions: These are the conditions that are not expressly agreed upon by the parties but are deemed to be
seller is under an obligation to transfer the ownership of goods to the buyer, who is under an
part of the contract by virtue of the Sale of Goods Act, 1930. Implied conditions can be further classified into the
obligation to pay the price for the goods. Once the sale is complete, the buyer becomes the following two types: • Conditions implied by law: These are the conditions that are deemed to be part of the contract
owner of the goods, and the seller has no further interest in them.In an agreement to sell, the by virtue of the law. For example, Section 16 of the Sale of Goods Act, 1930, provides that in a contract of sale, there is
parties agree to transfer the ownership of goods at a future date or on the happening of a an implied condition that the seller has the right to sell the goods.• Conditions implied by custom: These are the
certain event, such as the payment of the price or the delivery of the goods. The agreement to conditions that are deemed to be part of the contract by virtue of the custom of the trade. For example, in the sale of
sell creates an obligation on both parties to perform their respective obligations, i.e., the seller to second-hand goods, there is an implied condition that the goods are reasonably fit for their purpose. Warranties: A
transfer ownership of goods, and the buyer to pay the price. Definition of goodsAccording to the warranty is a term of the contract that is not essential to the main purpose of the contract. It is a subsidiary term that
does not go to the root of the contract. If a warranty is breached, the aggrieved party can claim damages for breach of
Sale of Goods Act, 1930, "Goods" means every kind of movable property other than actionable
contract, but cannot treat the contract as repudiated. Under the Sale of Goods Act, 1930, the warranties of a contract
claims and money. Movable property refers to any property that can be moved from one place
of sale can be categorized into the following two kinds:1. Express warranties: These are the warranties that are explicitly
to another, such as goods, furniture, machinery, and vehicles.The Act defines "Goods" broadly to agreed upon by the parties and are included in the contract of sale. Express warranties can be oral or written. For
include all types of tangible personal property that can be bought and sold, including goods that example, if the seller warrants that the goods are of a certain quality, that becomes an express warranty of the
are in a finished or unfinished state, and raw materials. The definition of goods also includes contract.2. Implied warranties: These are the warranties that are not expressly agreed upon by the parties but are
crops, timber, and other things attached to or forming part of land, which can be severed from deemed to be part of the contract by virtue of the Sale of Goods Act, 1930. Implied warranties can be further classified
the land. However, goods also exclude money and other forms of currency, as well as any into the following three types:• Warranty of title: This is an implied warranty that the seller has the right to sell the
intangible property such as patents, trademarks, copyrights, and other similar rights. goods and that the buyer will not be disturbed in his or her possession of the goods by anyone claiming a better title.•
Warranty of quiet possession: This is an implied warranty that the buyer will be able to enjoy quiet possession of the
goods without any disturbance from the seller or anyone else claiming a better title.• Warranty of fitness for purpose:
This is an implied warranty that the goods are reasonably fit for the purpose for which they are intended.

Implied conditions are terms that are not expressly stated in a contract but are assumed to be
present by law or custom. In the context of the Sale of Goods Act, 1930 in India, there are certain
conditions that are implied in every contract of sale, unless the parties have agreed otherwise. The
The performance of a contract of sale under the Sale of Goods Act, 1930 refers to the fulfillment
following are the implied conditions under the Sale of Goods Act, 1930: • Condition of title: The
of the obligations of both the seller and the buyer under the contract.The Act provides that the
seller must have the right to sell the goods, and the buyer must receive good title to the goods.•
seller must deliver the goods to the buyer and the buyer must accept and pay for the goods in
Condition of description: If the goods are sold by description, the goods must correspond to the
accordance with the terms of the contract. The performance of the contract is, therefore,
description.• Condition of quality or fitness: The goods sold must be of merchantable quality and
dependent on the following:• Delivery: The seller must deliver the goods to the buyer or any
reasonably fit for the purpose for which they are intended.• Condition of sample: If goods are sold
person authorized to receive them on behalf of the buyer, in accordance with the terms of the
contract. The delivery may be actual or constructive. Actual delivery means the physical handing
by sample, the bulk must correspond to the sample in quality and condition.• Condition of sale by over of the goods to the buyer, whereas constructive delivery means the transfer of possession of
sample as well as description: If the goods are sold by sample as well as by description, the goods the goods without physically handing them over.• Payment: The buyer must pay the price of the
must correspond to both the sample and the description.• Condition of fitness for a particular goods to the seller in accordance with the terms of the contract.The payment may be made in cash
purpose: If the buyer expressly or impliedly makes known to the seller the particular purpose for or through other modes of payment agreed upon between the parties.• Transfer of property: The
which he requires the goods, there is an implied condition that the goods shall be reasonably fit for property in the goods must be transferred from the seller to the buyer in accordance with the
terms of the contract. The transfer of property may take place either at the time of the contract or
that purpose. Implied warranties are promises that are not expressly stated in a contract but are at a later date as agreed upon between the parties.• Transfer of title: The seller must have the
right to sell the goods and the buyer must acquire a good title to the goods. If the seller does not
presumed to exist because of the nature of the transaction, the conduct of the parties, or the law.
have the right to sell the goods, the buyer may refuse to accept the goods and may also claim
In the context of the Sale of Goods Act, 1930 in India, there are certain warranties that are implied
damages for any loss suffered by him.• Quality of goods: The goods delivered must be of the
in every contract of sale, unless the parties have agreed otherwise. The following are the implied
quality and description as agreed upon between the parties. If the goods are not of the agreed
warranties under the Sale of Goods Act, 1930:• Warranty of title: The seller warrants that he has
quality or description, the buyer may reject the goods and may also claim damages for any loss
the right to sell the goods and that the buyer will receive good title to the goods.• Warranty of
quiet possession: The seller warrants that the buyer will have undisturbed possession of the goods,
free from any third-party claims.• Warranty of freedom from encumbrances: The seller warrants suffered by him. The Act also provides for the remedies • Specific performance: The court may
that the goods are free from any charge or encumbrance that was not disclosed or known to the order the party in default to perform his obligations under the contract.• Damages: The party
suffering from the breach of contract may claim damages for any loss suffered by him.• Rescission:
The contract may be rescinded or cancelled by the party suffering from the breach of contract.•
Repudiation: The party suffering from the breach of contract may repudiate the contract and claim
damages for any loss suffered by him.

Rights of seller: • Right to payment: Sellers have the right to receive payment for the goods
or services they provide.• Right to refuse service: Sellers have the right to refuse service to
customers who do not meet certain criteria,such as those who are abusive or disruptive.•
Right to set prices: Sellers have the right to set their own prices for their goods or services.•
Right to accurate representation: Sellers have the right to accurate representation of their
Transfer of Property in Specific Goods In a contract for the sale of specific or ascertained
products or services in advertising and marketing materials.• Right to sue for non-payment:
goods, the property in the goods passes to the buyer when the parties intend it to pass. The
If a buyer fails to pay for goods or services, sellers have the right to take legal action to
parties may intend for the property to pass immediately or at a later time. The general rule is
recover the unpaid amount. Rights of buyer: • Right to receive goods or services: Buyers
have the right to receive the goods or services they have paid for in a timely manner.• Right
that the property in the goods passes to the buyer when the contract is made, and the goods
to refunds or returns: Buyers have the right to request a refund or return for defective or
unsatisfactory goods or services.• Right to information: Buyers have the right to accurate are in a deliverable state. A contract for the sale of specific goods may provide for the
information about the goods or services they are purchasing.• Right to privacy: Buyers have property in the goods to pass at a future time. For example, a contract may provide for the
the right to privacy in their personal and financial information.• Right to file complaints: property in the goods to pass on payment of the purchase price. In such a case, the property
Buyers have the right to file complaints with the relevant authorities if they believe they have
been treated unfairly or illegally. in the goods will not pass until the condition is fulfilled. If the seller is required to do
something to put the goods in a deliverable state, such as packaging or labelling, the property

in the goods will not pass until the seller has done so. If the goods are in a deliverable state
but the seller is required to do something to ascertain the price, such as weighing or
measuring the goods, the property in the goods will not pass until the seller has done so.
Transfer of Property in Unascertained Goods In a contract for the sale of unascertained
goods, the property in the goods does not pass to the buyer until the goods are ascertained.
The goods are ascertained when they are identified and set aside from the rest of the seller's
stock. The property in the goods will pass to the buyer when they are ascertained, even if the
goods have not been delivered.The seller may be required to do something to ascertain the
goods, such as manufacture or selection. If the seller is required to do something to ascertain
the goods, the property in the goods will not pass until the seller has done so.

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