Assignment

Law200.21

Laws Relating to Sale of Goods Act 3,1930

Submitted by:

Md. Arifuddoza
2132545630
BBA
Section: 21
Spring’23

Submitted to:
Md. Abuboker Siddique (Bakul)
Additional Metropolitan Sessions Judge
Dhaka
 Laws Relating to Sale of Goods Act 3,1930

Introduction

The sale of goods is a key part of trade, influencing innumerable daily

activities. Understanding the legal framework that governs the sale of
commodities is critical for both businesses and individuals who buy and sell
goods. The law relating to the sale of goods in Bangladesh is governed by the
Sale of Goods Act, 1930 (Act No. 3 of 1930).

The Sale of goods Act, 1930, contains a wide range of legal principles and
provisions that control the purchase and selling of products in Bangladesh.
These laws not only establish the terms and conditions of the sale, but they
also handle issues such as contract formation, ownership transfer, conditions
and warranties, breach of contract remedies, and the rights and obligations of
both purchasers and sellers.

Chapter 1

Section 1 states the title, extent, and commencement of the Act. It clarifies
that the Act applies to the whole of Bangladesh and came into force on 1st
July 1930.

Section 2 of the Act provides the definitions of key terms used throughout the
legislation. Some of the important definitions include 'goods,' 'price,'
'document of title,' 'seller,' 'buyer,' 'delivery,' 'contract of sale,' 'conditions,' and
'warranties.' These definitions provide the underlying understanding required
for comprehending the Act's later sections.
Section 3 highlights that the Act is not applicable to transactions that fall
within the scope of other specific legislation, such as the Sale of Goods Act,
1862, or any enactment relating to the sale of particular goods.

Chapter 2

Section 4 of the Act deals with the definition and classification of a contract of
sale. It defines a contract of sale as a contract whereby the seller transfers or
agrees to transfer the ownership of goods to the buyer for a price. The
section further explains that the contract may be absolute or conditional,
depending on the terms agreed upon by the parties involved.

Section 5 highlights the distinction between a contract of sale and other

similar transactions. It clarifies that a contract of sale should not be confused
with agreements to sell, hire-purchase agreements, or contracts for work and
labor. It establishes that a contract of sale involves the transfer of ownership
of goods, whereas these other transactions have different characteristics and
legal implications.

Section 6 focuses on the essential elements required for the formation of a

contract of sale. It states that a contract of sale may be made about existing
goods, owned or possessed by the seller, or future goods. Section 7 states
about the contract is void if perished or become so damaged.

Section 9 discusses the importance of the price in a contract of sale. It states

that the price must be money or money's worth and should be fixed or
determinable. The section further clarifies that the price may be fixed by the
contract or may be left to be determined by a subsequent agreement between
the parties in Section 10.

Section 12 of the Sale of Goods Act, 1930, relates to the distinction between
conditions and warranties in a contract of sale. In a nutshell, conditions are
essential terms of the contract, the breach of which gives the aggrieved party
the right to repudiate or terminate the contract and claim damages. On the
other hand, warranties are minor terms that are not vital to the main purpose
of the contract. The breach of a warranty entitles the injured party to claim
damages but does not give them the right to reject the goods.

Section 13 of the Sale of Goods Act, 1930, addresses the circumstances

under which a condition in a contract of sale can be treated as a warranty.
According to this section, if a contract of sale includes a condition, but the
buyer accepts the goods or pays for them without objection despite the
breach of that condition, the condition is treated as a warranty. In such cases,
the buyer loses the right to terminate the contract based on the breach of the
condition but retains the right to claim damages for the breach.

Section 14 of the Sale of Goods Act, 1930, deals with the implied
undertaking as to title, etc. In summary, this section states that in a contract of
sale, unless otherwise agreed, the seller implicitly undertakes that they have
the right to sell the goods, the goods are free from any encumbrances, and
the buyer will have peaceful possession of the goods. This means that the
seller warrants that the goods being sold are legally owned by them and are
not subject to any third-party claims or restrictions. If there is a breach of this
implied undertaking, the buyer has a right to claim damages from the seller.

Section 16 of the Sale of Goods Act, 1930, addresses the implied conditions
as to quality or fitness of goods in a contract of sale. This section states that
when goods are sold by description, there is an implied condition that the
goods will correspond with the description given.

Chapter 3

Section 17 establishes the rules for the transfer of property in a contract of

sale. It states that unless otherwise agreed, the property in the goods is
transferred to the buyer at the time the parties intend it to be transferred. The
section emphasizes that the transfer of property is not dependent on the
delivery of the goods.

Section 18 addresses the transfer of property in specific or ascertained

goods that are in a deliverable state. It states that when there is an
unconditional contract for the sale of specific goods in a deliverable state, the
property in the goods passes to the buyer when the contract is made. This
means that the buyer becomes the owner of the goods immediately upon
entering into the contract.

Section 19 deals with the transfer of property in specific goods that are to be
put into a deliverable state. It states that when there is a contract for the sale
of specific goods that are to be manufactured or produced, and they have
been identified and appropriated to the contract, the property in the goods
passes to the buyer when they are so appropriated.

Section 20 addresses the transfer of property in the case of unascertained

goods. It states that when there is a contract for the sale of unascertained
goods, and subsequently, goods of that description and in a deliverable state
are unconditionally appropriated to the contract, the property in the goods
passes to the buyer when the appropriation is made.

Section 21 deals with situations where the seller has reserved the right to
dispose of the goods until certain conditions are fulfilled. It states that if the
seller reserves the right to dispose of the goods until the occurrence of a
certain condition, the property in the goods does not pass to the buyer until
that condition is fulfilled. This section allows the seller to retain ownership of
the goods until the specified condition is met.

Section 22 addresses the general rule that risk follows the transfer of
property. It states that unless otherwise agreed, the risk of loss or damage to
the goods passes to the buyer along with the property. This means that once
the property in the goods is transferred to the buyer, they become responsible
for any loss or damage that may occur to the goods.

Section 23 focuses on sales made by description. It states that when goods

are sold by description, there is an implied condition that the goods will
correspond with the description given. Additionally, it states that unless
otherwise agreed, there is also an implied condition that the goods are of
merchantable quality. This means that the goods should be reasonably fit for
their intended purpose and of a standard that a reasonable person would
expect.

Section 24 deals with sales made by sample. It states that when goods are
sold by sample, there is an implied condition that the bulk will match the
sample in quality. This means that the goods in the actual sale should be
similar in quality and characteristics to the sample shown to the buyer

Chapter 4

Section 31 imposes certain duties on the seller in a contract of sale. It states

that the seller must deliver the goods, transfer the property in the goods, and
ensure that the goods are free from any encumbrances or rights of third
parties. The seller is also responsible for packaging the goods properly and
providing any necessary documents to the buyer.

Section 32 establishes that in a contract of sale, unless otherwise agreed,

the buyer must be ready and willing to pay the price in exchange for the
delivery of the goods, and the seller must be ready and willing to deliver the
goods in exchange for the payment of the price. Payment and delivery are
considered concurrent conditions, meaning both parties' obligations are
interdependent.
Section 33 addresses situations where there is a discrepancy in the quantity
of goods delivered. It states that if the seller delivers a quantity of goods less
than what is agreed upon, the buyer may reject the whole delivery, accept the
partial delivery, or reject part of the goods and accept the rest. The buyer is
entitled to claim damages for any loss suffered due to the shortfall in quantity.

Section 34 deals with contracts that involve the delivery of goods in

instalments. It states that unless otherwise agreed, each instalment is treated
as a separate contract. The buyer may reject an instalment if there is a
substantial breach, such as non-delivery or delivery of defective goods in that
particular instalment. However, the buyer cannot reject a particular instalment
if it does not substantially affect the whole contract.

Section 35 focuses on the delivery of specific goods that are in a deliverable

state. It states that the seller must deliver the goods and the buyer must
accept and pay for them in accordance with the terms of the contract.
Delivery involves the voluntary transfer of possession of the goods from the
seller to the buyer, and the buyer is bound to accept the goods once they are
offered for delivery.

Section 36 addresses situations where there is a discrepancy in the quantity

of goods delivered. It states that if the seller delivers a quantity of goods
greater than what is agreed upon, the buyer may accept the delivery of the
goods included in the contract and reject the rest. The buyer is not obliged to
accept the excess quantity unless they give notice to the seller of their
intention to do so.

Section 37 deals with situations where the seller is required to deliver the
goods to a carrier for transportation to the buyer. It states that once the goods
are delivered to the carrier, the risk of loss or damage to the goods passes to
the buyer. The section further clarifies that the seller is not responsible for any
loss or damage that may occur during transit unless there is a breach of their
obligations as a result of their own actions or instructions.

Summary

In summary here are 10 important laws regarding Sale of goods. Here are 10
important sections from the Sale of Goods Act, 1930 (Act No. 3 of 1930):

Section 2: Definition of "goods" - This section defines goods as every kind of

movable property except for actionable claims and money.

Section 4: Sale and agreement to sell - This section distinguishes between a

sale and an agreement to sell, highlighting the conditions under which each
occurs.

Section 12: Condition and warranty - This section distinguishes between

conditions and warranties in a contract of sale, outlining the consequences of
their breach.

Section 13: When condition to be treated as warranty - This section

establishes that if a buyer accepts goods or pays for them without objection
despite a breach of condition, the condition is treated as a warranty.

Section 14: Implied undertaking as to title, etc. - This section implies that the
seller has the right to sell the goods, the goods are free from encumbrances,
and the buyer will have peaceful possession of the goods.

Section 16: Implied conditions as to quality or fitness - This section

establishes that when goods are sold by description, there is an implied
condition that they correspond with the description, and when goods are sold
by sample, there is an implied condition that the bulk matches the sample in
quality.