sale of goods

Governed by the Sale of Goods Act, 1930. Section 4 distinguishes a sale, where property in the goods passes at once, from an agreement to sell, where it passes at a future time or on a condition. The distinction matters for risk (which generally follows property, s.26), for the remedies of the parties, and for insolvency.

The Act implies conditions and warranties, such as conditions as to title, description, merchantable quality and fitness for purpose (ss.14–17), subject to the rule of caveat emptor. An unpaid seller has rights of lien, stoppage in transit and resale. “Goods” means movable property other than actionable claims and money (s.2(7)).

Example

Since the specific car was in a deliverable state, property passed when the contract was made, and the sale of goods was complete even before payment.

In Indian law

• Sections 2(7), 4, 14–17 and 26, Sale of Goods Act, 1930

See also

caveat emptor · warranty · movable property · lien

Read more in the study notes

• Principal steps in arbitration and interim measures (Alternative Dispute Resolution Systems)
• Control of the RBI over non-banking companies, financial and non-financial (Banking Law)
• Default and recovery: Debts Recovery Tribunals and the SARFAESI Act (Banking Law)
• Business: meaning, scope and objectives (Business Environment)
• Consumerism, the consumer movement and voluntary organisations (Business Environment)
• Practices controlled by competition law: an overview (Competition Law)