ABS academy of science technology

and
management

• Name – Disha dey

• Department – MBA
• Semester – 1st
• Subject – Business laws, ethics and Governance
• Topic - sale of goods act, 1930
 Introduction
We are aware that every business entity runs by buying or selling commodities. In India,
such sales of goods are governed by the Sale of Goods Act, 1930. This Act has been
codified as a separate enactment of the law relating to the sale of goods, which was
contained in Sections 76 to 123 of the Indian Contract Act of 1872. Those sections of
the Contracts Act have been repealed by the Sale of Goods Act. This was done because
the provisions of the Contract Act were found to be inadequate to deal with the new
situations that were arising due to an increase in mercantile transactions in the wake of
rapid industrialisation. Hence, a new law was formed to deal with the sale of goods
which incorporates various provisions of the English Sale of Goods Act. 1893. However,
despite the separate legislation in terms of the Sale of Goods Act, the Contract Act
continues to apply to the contracts relating to the sale of goods. The Act lacks in
defining some of the expressions and words that are otherwise defined in the Contract
Act. In this article, the author will be discussing the Sale of Goods Act. 1930 in detail by
analysing all the important provisions and case laws.
 HISTORY
 The law relating to sale and purchase of goods, prior to 1930 were
dealt by the Indian Contract Act, 1872.
 In 1930, a separate Act known as the Sale of Goods Act is passed.
 It is a contract whereby the seller transfers or agrees to transfer the
title (ownership) in the goods to the buyer for consideration.
 It is applicable all over India, except Jammu and Kashmir.
 The goods are sold from owner to buyer for a certain price and at a
given period of time.
 The name Indian is removed from the act with effect from 23
September 1963 hence the act name is now Sale of Goods act
1930.
 DEFINITION
 Buyer : A person who buys or agrees to buy goods.
 Seller : A person who sells or agrees to sell goods.
 Goods : Every kind of movable property other than actionable things
and money.
 Existing goods : Goods which are in existence at the time of contract
of sale.
 Future goods : Goods which are to be manufactured /produced by
seller after making contract of sale.
 Specific goods : Goods which are identified & agreed upon at the time
of contract of sale has been made.
 GOODS
 Goods are defined to mean every type of movable property other
than actionable claims and money.
 The term comprises stock and shares, rising crops, grass, and things
attached to, or forming part of the land which are agreed to be
served before sale or under the contract of sale.
 Existing Goods Specific goods
 As per Section 6 of the Act, existing goods are • These are the goods which are
those goods which are owned or possessed recognized and agreed upon
through the seller at the time of contract of
through the parties at the time a
sale.
contract of sale is made.
 The seller is either the owner of goods, or he is
• For instance, a specified watch,
in possession of goods.
ring, or a car.
 For instance A, a manufacturer of fans, sells a
fan to B. It is a contract of sale of existing
goods because A owns the fan.
Ascertained goods Unascertained goods
 Goods identified subsequent to the  The goods, which are not separately identified or
formation of the contract of sale. The terms ascertained at the time of the making of the
ascertained and specific, are commonly used contract, are known as ‘unascertained goods.
for same kind of goods.  If A agrees to sell to B one bag of sugar out of
 Ascertained goods are those goods which the lot of one hundred bags lying in his go down,
are identified in accordance with the it is a sale of unascertained goods because it is
agreement after the contract of sale is not known which bag is to be delivered.
made.  In a contract for the sale of 100 pieces of chairs,
 For example: You go to a vegetable market the seller has to deliver 100 pieces of chairs that
and demand 2kgs of tomatoes. When the answer the contract description. If there is no
seller appropriates 2kgs of tomatoes in specific description, then the seller may deliver
accordance with the agreement, they any kind of chairs.
become ascertained. If you find some
defects in it, you can replace it.
Future goods Contingent goods
 Goods to be manufactured, produced  Goods, the acquisition of which by the
or acquired after making of the seller, depends upon an uncertain
contract are called future goods. contingency are called ‘contingent
 Example: A computer manufacturer goods’. They are also a type of future
contracted to sell 100 computers to goods.
Rahul. The computers were yet to be  Example: ‘A’ agrees to sell 100 units of
manufactured. This is an agreement an article provided the ship which is
of future goods not in the bringing them, may or may not reach
possession of seller at time of the port safely. This is an agreement for
making contract. the sale of contingent goods.
Conclusion
The article has covered all the important topics and provisions along with
case laws. As stated above, the author would like to conclude by stating
that it is high time India updated itself by following global standards. The
Sale of Goods Act is pre- independence legislation and is mostly
inconsistent with today’s trade regimes. If India upgrades the laws as per
the United Nations Convention on Contracts for the International Sale of
Goods 1980, it will be easier and better to deal with private international
laws as well as if there is a conflict of laws, then also globally used
legislation would be better to be used. Considering exports and imports.
There have been very few cases of the Sale of Goods Act in recent years.
One of the reasons may be that the provisions are kind of outdated to
tackle the new era problems.
Thank
you