NOTES


CA-Foundation > Business Laws > The Sale of Goods Act, 1930 - Formation of Contract of Sale (Old & New)

Define Buyer, Seller and Sale in the Contract of Sale of Goods Act.



Ans.
CONTRACT OF SALE

Sec. 4(1) of the Sale of Goods Act defines a contract of sale of goods as -“a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price”.

A contract of sale of goods, like any other contract, results by an offer by one party and its acceptance by the other. The parties are free to decide the terms and conditions of performance of their contract. Wherever the contract is silent, rules provided by the Sale of Goods Act apply to the relevant issue.

Buyer means a person who buys or agrees to buy goods. [Sec. 2(1)]

Seller means a person who sells or agrees to sell goods. [Sec. 2(13)]

Property means the general property in goods, and not merely a special property. Sec. 2(11). Property means ownership. If A who owns goods pledges them for raising money to B, A has the general property in the goods, while B (pledgee, person with whom goods are pledged) has a special property or interest in them, e.g. pledgee has a right to retain the pledged goods until he is paid by A (pledgor) the entire amount of his loan with interest.

Essential characteristics of a contract of sale

1. Two parties - there must be two parties a buyer and a seller.

2. Transfer of property - a transfer of property i.e. ownership, in goods from the seller to the buyer must take place (in the case of sale) or ownership should be agreed to be transferred (in the case of agreement to sell)

3. Goods - the subject matter of sale must be goods.

4. Price - transfer of property must take place for some money consideration called price.

5. It includes both a ‘sale’ and ‘an agreement to sell’.

6. A contract of sale may be absolute or conditional [Sec. 4(2)].

7. It may be in writing/oral or implied

8. Essential elements of a valid contract must be present.


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Notes of The Sale of Goods Act, 1930 - Formation of Contract of Sale (Old & New)



  1. What are the implied conditions in a Contract of Sales:
    see in detail

  2. Define Buyer, Seller and Sale in the Contract of Sale of Goods Act.
    see in detail

  3. What is a ‘Price’ under the Sales of goods act, 1930?
    see in detail

  4. What are the various rules and modes of fixing the prices of goods, as provided under section 9 and section 10 of the Sale of Goods Act?
    see in detail

  5. State the distinction between Sale and an agreement to sell.
    see in detail


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