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The Sale of Goods Act

The Sale of Goods Act

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Published by: towfiqeee on Nov 17, 2012
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THE SALE OF GOODS ACT, 1930 What do you mean by ‘goods’? How many kinds are there?

What are the essential characteristic of a contract of sale of goods? Goods: According to Section-2 (7) of the sale of goods Act. 1930, the term "goods" means every kind of moveable property other than actionable claims and money; and includes electricity, water, gas, 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. Movable properties are those which can be moved from place to places. For example mobile, laptops, electricity, water, gas, money, shares of a company etc. Immovable properties are those which are attached to the land, like building, trees etc. But crops like wheat, rice etc including fruits of a tree are movable property because in can easily be separated from the trees before sale. Under the Sale of Goods Act, 1930 all the movable properties are good except (i) actionable claim and (ii) money. We better under stand what is money. Now we need to know what actionable claim is. This means a claim which can be claim and enforced by the court. For example: a loan and debt to another person. If Karim owes 100 taka to Rahim. Rahim cannot offer Jashim to buy the debt of Karim in exchange of money or any thing else because if Karim refuses to pay his debt then Rahim have to file a suit in the court to recover his debt which is an actionable claim. So it is clear from that all kinds of movable properties are Goods, except actionable claim and money. Classification of Goods: Goods may be classified into three types: (i) Existing Goods, (ii) Future Goods and (iii) Contingent Goods. (i) Existing Goods are those goods which are already in existence and which are physically present in some person’s possession or ownership. Like Mangoes, apples and bananas, which are in possession of the shopkeeper. (ii) Future Goods are those goods which will be manufactured or produced or acquired by the seller after the making of the contract of sale. Like green or unripe mangoes in the garden. Which the gardener will acquire after ripen and will sell to those the gardener agreed with. (iii) Contingent Goods: There may be a contract for the sale of goods the acquisition of which by the seller depends upon a contingency which may or may not happen. In such cases the goods sold are called Contingent Goods. Contingent goods come within the classes of future goods. For example: X agrees to sell to Y a certain ring provided he is able to purchase it from its present owner. This is an agreement for the sale of contingent goods.

What is contract of sale? A contract of sale of goods may be either a sale or an agreement to sell. Where under a contract of sale the property in the goods is transferred from the seller to the buyer the contract is called a sale. The transaction is a sale even though the price is payable at a later date or delivery is to be given in the future, provided the ownership of the good is transferred from the seller to the buyer. On the other hand when the transfer of ownership is to take place at a future time or subject to some condition to be fulfilled later, the contract is called an agreement to sell. The Essential Elements of a contract of sale: The essential elements of a contract for the sale of good are described below: 1. Movable Goods: Goods must be movable. The sale of goods Act deals with movable goods, except actionable claim and money. Movable goods for money: There must be a contract for the exchange of movable goods for money. Therefore in a sale there must be money consideration. An exchange of goods for goods is not a sale. But is have been held that if an exchange is made partly for goods and partly for money, the contract is on of sale. Two parties: Since a contract of sale involves a change of ownership, it follows that the buyer and seller must be different person or persons. A sale in a bilateral contact. A man cannot buy from and sell goods to himself. To this rule there is one exception provided for in section 4(1) of the Sale of Goods Act. A part-owner can sell goods t another part-owner. There for a partner may sell goods to his firm and the firm ma sell gods to a partner.




Formation of contract of sale: A contract of sale is make by an offer to buy or sell goods for a price and the acceptance of such offer. The contract may provide for the immediate delivery of the goods or immediate

payment of the price or both, or for the delivery and payment by installments, or that the delivery of payment or both shall be postponed. 5. Method of forming the contract: Subject to the provision of any law for the time being in force, a contract of sale may be in writing or by word of mouth, of may be implied from the conduct of the parties. The terms of contract: The parties may agree upon any term concerning the time, place and mode of delivery. The terms may be of two types: essential and non-essential. Essential terms are called condition and nonessential terms are called Warranties. The Sale of Goods Act provides that in the absence of a contract to the contrary, certain conditions and warranties are to be implied in all contract of sale. Other essential elements: Others essential elements for a sale of goods are those elements which are given and to be fulfilled under Law of contact Act. A contact of sale of goods must satisfy all the essential elements necessary for the formation of a valid contract. For example- the parties must be competent i.e. attained the age of majority to enter into a contract, the object must be lawful etc.



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