THE SALE OF GOODS ACT,1930.

INTRODUCTION:
TILL, 1930, TRANSACTIONS 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 IN 1930, SECTIONS 76 TO 123 OF THE INDIAN CONTRACT ACT WERE REPEALED AND A SEPARATE ACT CALLED THE SALE OF GOODS ACT ,1930 WAS PASSED.THIS ACT EXTENDS TO WHOLE OF INDIA EXCEPT JAMMU AND KASHMIR.

SCOPE OF THIS ACT :

THIS ACT DEALS WITH GOODS BUT NOT WITH

ANY MOVABLE PROPERTY , E.G., ACTIONABLE CLAIMS AND MONEY.THIS ACT DOES NOT DEAL WITH MOVABLE PROPERTY OTHER THAN GOODS AND IMMOVABLE PROPERTY.

CONTRACT OF SALE MEANING SEC4.

CONTRACT OF SALE OF GOODS IS A CONTRACT

WHEREBY THE SELLER TRANSFERS OR AGREES TO TRANSFER THE PROPERTY IN GOODS TO THE BUYER FOR A PRICE. CONTRACT OF SALE IS A GENERIC TERM WHICH INCLUDES BOTH A SALE AS WELL AS AN AGREEMENT TO SELL.

ESSENTIAL ELEMENTS OF CONTRACT OF SALE:

A) SELLER AND BUYER
B) GOODS C) TRANSFER OF PROPERTY

D) PRICE
E) ESSENTIAL ELEMENTS OF VALID CONTRACT.

 A) SELLER AND BUYER: BUYER MEANS A PERSON

WHO BUYS OR AGREES TO BUY GOODS SEC2(1).AND SELLER MEANS A PERSON WHO SELLLS OR AGREES TO SELL GOODS SEC2(13). B) GOODS: GOODS MEANS 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 A PART OF THE LAND WHICH ARE AGREED TO BE SEVERED BEFORE SALE OR UNDER THE CONTRACT OF SALE.SEC2(7).

NOTES:
THE ACTIONABLE CLAIMS

MEANS A CLAIM WHICH CAN BE ENFORCED THROUGH THE COURTS OF LAW, E.G A DEBT DUE FROM ONE PERSON TO ANOTHER IS AN ACTIONABLE CLAIM. THE MONEY HERE MEANS THE LEGAL TENDER MONEY I.E CURRENCY OF THE COUNTRY BUT NOT OLD COINS.

 C) TRANSFER OF PROPERTY: PROPERTY MEANS

THE GENERAL PROPERTY IN GOODS, AND NOT MERELY A SPECIAL PROPERTY.GENERAL PROPERTY IN GOODS MEANS OWNERSHIP OF THE GOODS.SPECIAL PROPERTY MEANS POSSESSION OF GOODS. THUS THERE MUST BE EITHER TRANSFER OF GOODS OR AN AGREEMENT TO TRANSFER THE OWNERSHIP OF GOODS( IMMEDIATELY OR IN FUTURE).

 D)PRICE: PRICE HERE MEANS THE MONETARY

CONSIDERATION FOR THE SALE OF GOODS SEC2(10).WHEN CONSIDERATION IS FOR GOODS IT AMOUNTS TO BARTER SYSTEM. AND WHEN IT IS FOR NO CONSIDERATION THEN IT IS GIFT AND NOT SALE. E) ESSENTIAL ELEMENTS OF A VALID CONTRACT- U/S 10 OF INDIAN CONTRACT ACT 1872.

DISTINCTION BETWEEN SALE AND AGREEMENT TO SELL:

BASIS OF DISTINCTION:
1) TRANSFER OF OWNERSHIP: SALE TRANSFER OF OWNERSHIP OF GOODS

TAKES PLACE IMMEDIATELY. AGREEMENT TO SELL: TO HAPPEN AT A FUTURE DATE OR SUBJECT TO FULFILMENT OF SOME CONDITION. 2) EXECUTED CONTRACT/EXECUTORY CONTRACT:

 SALE: EXECUTED CONTRACT

AGREEMENT TO SELL : EXECUTORY CONTRACT. 3) CONVEYANCE OF PROPERTY:

SALE:

A SALE CREATES JUS IN REM (RIGHT AGAINST THE PROPERTY). AGREEMENT TO SELL: IT ONLY CREATES JUS IN PERSONAM( RIGHT AGAINST THE PERSON)

 4) TRANSFER OF RISK:
SALE : TRANSFER OF RISK OF LOSS OF GOODS

TAKES PLACE IMMEDIATELY BECAUSE THE OWNERSHIP IS TRANSFERED . AGREEMENT TO SELL: RISK OF LOSS OF GOODS IS NOT EXISTING AS THE OWNERSHIP IS NOT YET TRANSFERED.

 5) RIGHTS OF SELLER AGAINST THE BUYERS

BREACH: SALE -SELLER: HE CAN SUE THE BUYER FOR THE PRICE EVEN THOUGH THE GOODS ARE IN HIS POSSESION. AGREEMENT TO SELL:SELLER CAN SUE THE BUYER FOR DAMAGES ONLY.

 6) RIGHTS OF BUYER AGAINST THE SELLERS

BREACH: SALE- BUYER CAN SUE THE SELLER FOR DAMAGES AND CAN SUE THE THIRD PARTY WHO BOUGHT THOSE GOODS. AGREEMENT TO SELL: BUYER CAN SUE THE SELLER FOR DAMAGES ONLY.

HIRE PURCHASE AGREEMENT:

MEANING: IT MEANS AN AGREEMENT UNDER

WHICH GOODS ARE LET ON HIRE AND THE HIRER HAS AN OPTION TO PURCHASE THEM IN ACCORDANCE WITH THE TERM OF THE AGREEMENT AND INCLUDES UNDER WHICH: POSSESSION OF GOODS IS DELIVERED BY THE OWNER THEROF TO A PERSON ON CONDITION THAT SUCH PERSON PAYS THE AGREED AMOUNT IN PERIODICAL INSTALMENTS.

 2) THE PROPERTY IN THE GOODS IS TO PASS TO

SUCH A PERSON ON THE PAYMENT OF LAST INSTALMENT AND 3) SUCH A PERSON HAS A RIGHT TO TERMINATE THE AGREEMENT AT ANY TIME BEFORE THE PROPERTY SO PASSES.

GOODS
MEANING OF GOODS SEC 2(7):
GOODS MEANS EVERY KIND OF MOVABLE

PROPERTY OTHER THAN ACTIONABLE CLAIMS AND MONEY, AND INCLUDES THE FOLLOWING: 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.

 EXAMPLE

OF GOODS: STOCKS , SHARES DEBENTURES, OLD RARE COINS, GOODWILL, TRADEMARK, PATENTS, ETC. EXCLUSIONS : ACTIONABLE CLAIMS, LEGAL TENDER MONEY, IMMOVABLE PROPERTY.

TYPES OF GOODS:
1) EXISTING GOODS:IT MEANS GOODS WHICH

ARE EITHER OWNED OR POSESSED BY THE SELLER AT THE TIME OF CONTRACT OF SALE.THE EXISTING GOODS MAY BE AS FOLLOWS: SPECIFIC :LIKE T.V, D.V.D ETC. ASCERTAINED GOODS: WHEN PART OF THE GOODS LYING IN BULK ARE IDENTIFIED AND EARMARKED FOR SALE. UNASCERTAINED: GOODS LYING IN LOTS UNIDENTIFIED.

 2) FUTURE GOODS: SEC 2(6) IT MEANS GOODS

TO BE MANUFACTURED OR PRODUCED OR ACQUIRED BY THE SELLER AFTER MAKING OF THE CONTRACT OF SALE. THERE CAN BE AGREEMENT TO SELL ONLY AS ONE CANNOT DO A SALE OF WHAT HE DOES NOT POSSESS.

 3) CONTINGENT GOODS: SEC6(2) THESE ARE

THE GOODS THE ACQUISITION OF WHICH BY THE SELLER DEPENDS UPON CONTINGENCY WHICH MAY OR MAY NOT HAPPEN.