ASSIGNMENT

NAME: HASSNAIN MEMON

CLASS: B.A-LLB 5TH SEC (A)

ROLL NO: 0234

TOPIC:

Definition of Sale

A sale is a type of contract in which the seller transfers the ownership of goods to
the buyer for a money consideration. Here the relationship amidst the seller and
buyer is of creditor and debtor. It is the result of an agreement to sell when the
conditions are fulfilled and the specified time is over the agreement.

The following are the essential conditions regarding Sale:

1. There must be at least two parties; one is the buyer, and other is the seller.

2. The subject matter of the sale is the goods.

3. Payment should be made in the country’s legal currency.

4. The goods should pass from seller to buyer.

5. All the necessary conditions of a valid contract should be present like free
consent, consideration, a lawful object, capacity of parties, etc.

If the goods are being sold and the property is transferred to the buyer, but the
seller is not paid. Then, the seller can go to the court and file a suit against the
buyer for the damages and the price too. On the other hand, if the goods are not
delivered to the buyer then he can also sue the seller for damages.

Sale deed is complete transfer of ownership and registered under section 17 of

REGISTRATION ACT, and it is executed in nature it also confer complete rights ,
tittle, and interes in the property. Hence, a person shall have a right in rem upon
the dispute arisen from sale deed.

What is an agreement for sale?

Definition of Agreement to Sell

An agreement to sell is also a contract of sale of goods, in which the seller agrees
to transfer goods to the buyer for a price at a later date or after the fulfilment of a
condition.

An agreement for sale, is an agreement to sell a property in future. This

agreement specifies the terms and conditions, under which the property in
question will be transferred. The Transfer of Property Act, 1882, which regulates
the matters dealing with the sale and transfer of house property, defines the
contract for sale or an agreement for sale as under:
“A contract for the sale of immovable property, is a contract that a sale of such
property shall take place on the terms settled between the parties” – Section 54.
Section 54 further provides that “It does not, of itself, create any interest in or
charge on such property.”
From the above definition, it becomes amply clear that an agreement for sale
contains a promise to transfer a property in question in future, on satisfaction of
certain terms and conditions. So, this agreement itself does not create any rights
or interest in the property, for the proposed buyer.
What the sales agreement creates, is a right for the purchaser to purchase the property
in question on satisfaction of certain conditions. Likewise, the seller also gets the right to
receive the consideration from the buyer on complying with his part of the terms and
conditions.

In case of failure of the seller to sell or hand over possession of the property to the buyer, the
buyer gets a right of specific performance, under the provisions of the Specific Relief Act, 1963.
A similar right is available to the seller under the agreement, for seeking specific performance
from the buyer.

Key Differences Between Sale and Agreement to Sell

The following are the major differences between sale and agreement to sell:
1. When the vendor sells goods to the customer for a price, and the transfer of goods from
the vendor to the customer takes place at the same time, then it is known as Sale. When
the seller agrees to sell the goods to the buyer at a future specified date or after the
necessary conditions are fulfilled then it is known as Agreement to sell.
2. The nature of sale is absolute while an agreement to sell is conditional.
3. A contract of sale is an example of Executed Contract whereas the Agreement to Sell is
an example of Executory Contract.
 4. Risk and rewards are transferred with the transfer of goods to the buyer in Sale. On the
other hand, risk and rewards are not transferred as the goods are still in possession of
the seller.
5. If the goods are lost or damaged subsequently, then in the case of sale it is the liability of
the buyer, but if we talk about an agreement to sell, it is the liability of the seller.
6. Tax is imposed at the time of sale, not at the time of agreement to sell.
7. In the case of a sale, the right to sell the goods is in the hands of the buyer. Conversely,
in agreement to sell, the seller has the right to sell the goods.

Conclusion

Under Indian Sale of Goods Act 1930, section 4 (3) deals with the contract of sale
and agreement to sell, where it has been clarified that the agreement to sell also
come under sale. However, there is a distinction between these two terms which
we discussed above.