Sale of Good

s Act, 1930
~ - - ~ - - . - - - - - Qu;stions&
What are the differences betwee- , Answers
. n a Conditio '
Also, explain, when
• •
shall a 'breach f
0 conditio • b
. ac
n and 'Warr anty, in
n e treated as ,breach
under the prov1s10n of the Sale of Goo d s Act, 19307 of of sa\ e?
ontract
(Dec. 2021, RTP · Warranty'
D~i;.;ff~e:::r:en;;-c;.e;.;b;etw~;ee;n~C~o:njd~iti;i.~o~n..::a~n~d~W~~May 2 021,
-_
RTP No
_ v. 2020, Jan. 2021)
arranty
;\JlS,
Basis Condition
A condition is · a st·ipu 1ation
. Warranty
Main .
essential to the main Purpose of A warranty IS· t 1
purpose collateral to th ~ ipulation
the contract. e main purp
of the contract. ose
-Breach In the breach of the conditio Breach 0 f warranty h- 1
the contract can be repudiate 0 ; aggrieved ' t e
the damages can be claimed ; party can clai
damages only. m
both.
Treat Breach of condition may be A breach of warranty 1
t rea t e d as a b reach of warranty. t cannot be
reated as a breach of condition

According to the provision of the Sale of Goods Act, 19 30, a breach of c d .

.
be treated as a breach of the warranty in the follow·mg circumstances· on ltion may
i) Where a contract of sale is subject to any condition to be fulfille~ b th
the buyer may waive the condition. Y e seller, ½

ii) Where the buyer elects to treat the breach of condition a s a b reach of warranty
½
iii) Where the contract of sale is non-severable ' and the bu yer h as accepted the· ½
whole goods or any part thereof.
iv) Where the fulfilment of any condition or warranty is excused by law by reason ½
of impossibility or otherwise.
2. "A non-owner can convey better title to the bonafide purchaser of goods for value". 5
Discuss the cases when a person other than the owner can transfer title in goods as
per the provisions of the Sale of Goods Act, 1930?
(Nov. 2020, May 2019, RTP May 2020, ICAI SM, Nov 2021 RTP)
Ans. As per the provision of the Sale of Goods Act, 1930, "A non-owner can convey better
title to the bonafide purchaser of goods for value" in the following case:
1
1) Sale by a mercantile agent: A sale made by a mercantile agent of the goods for
the document of title to goods would pass a good title to the buyer if:
i) He was in possession of the goods or documents with the consent of the
owner. 5
ii) If the sale was made by him when acting in the ordinary course ofhu lness
as a mercantile agent. Of l
W) The buyer had acted in good faith and has at the time of the contract sa e,
sell. d h
1. . to
no notice of the fact that the seller had no authority t owners. of goo s as
by one of the joint owners: If one of severa )..Qlil . the
. . f th co-owners, the property m
le possession of them by perm1sswnb ° . . owne r in
ethem from such 101nt
• transferred to any person who uys tice that the seller
1
~...,.,.ot at the time of the contract of sa e no
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8
 ----ion under votd.ilile contract: A huyer would
___,..-::~;;:i:'t;-;-jp;";e;r;so~nn tn possess . 11 to him by a seller who had obtained
3} sale .by . a ,,nod titll' to th,l goods. sotrl ,d vnid,1blc on the ground of coercio!' ½
-
l' ,1 r,
',cqun .. · in '
tht' gmHls lll Hll'r ,1 con il"''"'''' proviclcd th,1t the contrnct had nc.....,t
po«•''"'....01 ·J!Sl!lllllli!lll ',,. lludUC Jll "'."'- '
fn\Ul.l, ~lll
, ,n n•sdn1h•tl unt ii l hi
, t\nll' of tht' sale,
. Id the goods \)lit cont lnucs In possession
.. actual y so,
llt: by one who I,,ts 1 .
,.) \s.itc ,oods but CQJllim1es t_u._.bc m possession ol
... ,tht•rt•of: 11 ,1 plisn 1
' .. n h,1s· soil.1 l ic, tog them, ht• may sell them to a third. person,
I H'Ullll'nh 11 .. l :inci wit
ol, l.il , tlll'rcofill £pod faill . l1out t h e notice \ %
t\ll'tl\ ,n· ol. t I11' 11 .
. •
,u1tl 11 such pct :-,l
1
\ .. )II 11ht,1tt1S th: IVl I y
Id h tVt' uood title to them .
I
.
ot t\ll' pn•vwus s, ' . · ,h' ht' wou . sslon before the property in the goods has I
• f,

\ 5) Sale by buyer< • 1bntntng

' posse. r with thl' Cj)J}Sl,'Ot of the seller. obtains \
d htnr Where a 11uyc , \ th.
veste .In . . , d he tn<lY s.cU QLplcdec or djsposc. of the goods to the
\ possesswn ol the goo s, \
t \111· ·li p c•rson· . WI the owner let the other person sell his
. goods, and the \ 1h.
\
6) Effect of estoppe 1• ,en \
owner does not deny his authority to sell those goods. . . . . \
·d tier· When an unpaid seller has exercised his nght of l.ie.n
7) Sale by an unpa1 · t nslt ·
se resells the goods the buyer acquires a good title to the ½
or stoppaee m _ra___ '
goods as against the original buyer.
8) Sale under the provisions of the other Acts:
i) Sale by an Qffic;ial Receiver or Liquidator of the company.
ii) Purchase of goods from a finder nf goods. I
\ iii] A sale by eawnee can convey a good title to the buyer. \
What is the doctrine of"Caveat Emptor"? What are the exceptions to the doctrine of I 6
3.
II "Caveat Emptor"? (Nov.2020,Nov.2018) \\
As per the provision of the Sale of Goods Act, 1930, the doctrine of 'Caveat Emptor' \ 2
Ans, means 'Let the buyer beware'. When the seller displays their goods in the open \
\ market, it is for the buyers to make proper selection or choice of the goods. If the \
goods turn out t~ be defective, the buye_r cannot hold the seller liable . The seller is in \
no way responsible for the bad selection of the buyer. The seller is not bound to
disclose the defects in the goods which he is selling. \
\ Exceptions to the rule of 'Caveat Emptor': ½ mark
1
l Fimess as to qµality or use, Where the buyer makes known to the seller the I foreacb
particular purpose for which the goods are required, so as to show that he relies point
\
on the seller's skill or judgment and th e goo d s are of a description which is in the
d of seller's business to suppl Y, it
course . t h e duty of the seller to supply such
• is
goo s as are reasonably fit for that purpose.
2) Goods purchased
purchased under its p·itepatent
under t or brand name.. In a case where the goods are
' n name or brand na h .
that the goods shall he fit for. . me, t ere 1s no implied condition
f-oods 50\d b d . . any particular purpose.
Y esrngt10n: Where the O 15 .
implledcondltion that th d g Ol ate sold by description there is an
lhen the seller ts responsible.
e goo s shall corresp t · '
· om with the description. lf it is not

.a-•-
- : Where
. . tn goods of that d the good s are b ought by description from
of merchantabl:scrl~~lon, th ere Is an implied condition that
er has qua ty. th e rule of Caveat Emptor is not
. rule shall apply if
examined the goo d s, this

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 ~~~c such which ~gh t to h,wc not lwcn revealed hy onllnnry
the dcft.:C
~,_a111in:iti0n.
, ~: \'vtwr~ the goorls ,\re hought by :-,11nplc, this rule of C;wcat
5) ~ . d()l'S not apply ti till' hulk doc•, not I otTl'Spmul w1 1h 1hc s,1mplc.
· ~~~~Ll. .m, d1'sLl'Ul~ll
f.tllptOI , Wl~t•n• Ihe _R<HHls .,re 1_1ought by sample
ti) ~-l'll ns dl'~cnptwn, till' ntk ot C.,Wl',tl hmptor l:i not apphcahll• In case the
:1:- i . d, not cont•spond with both tlw s,11nplt• and dPsrription or either ol the
gtUll:, (
condition.
~ . p h<'d
; u : ~: A11 1111 . wa rr, Ill ty o 1· n111d It
. I.on ,IS to qua I1t
. y or 11 t 11ess for a
1) . _ . nurirnsc may \w nntH'Xl'd by thl' usage of trade, and if the seller
, t ,s111
p11rtllll • frolll
t th,1t,
t this ruk ol C.wcat Emptor is not ,1pp\icahlc.
. ,~c_ti.\'d~·
tfl'\ \,l l. cQ!lcr:iliiJLUclc.Ct
. or 1s
. guilty
. ul. fraud Where the seller sells the
81 ~ 1 - ti,· t11Jk 1nn some misrepresentation or fraud, and the buyer relies on it or
goou:- the
"·h<l1 . ,el\c1 ,1ct1vcly
r, •
conceals some defect 111
.
the goods so that the same could
disco\'ercd by the buyer on a reasonable examination, then the rule of
no t be Emptor
C:tn~.lt . will not apply. ln such a case, the buyer has a right to avoid the
contract and claim d ~ e_s_ __ 3
~ h o p p i n g in a self-service Supermarket. He picked up a bottle of cold
4· drink (Torn a shelf While he was examining the bottle, it exploded in his hand and
,njured him. He files a suit for damages against the owner of the market on the
ground of breach of condition. Decide under the Sale of Goods Act, 19 3 O, whether Mr
Amit would succeed in his claim? (RTP May 2020)
2
An< As per the provision of the Sale of Goods Act, 1930, which states that where goods
are bought by description from a seller who deals in eoods of that description, there
h the ds all erchanta le al' . Though the
term 'merchantable quality' is not defined in the Act, it means that in the present
case, the bottle must be properly sealed. In other words, if the goods are purchased
for self-use, they should be reasonably fit for the purpose for which it is being used.

Facts of the case:

Mr Amit was shopping in a self-service Supermarket. He picked up a bottle of cold
½
drink from a shelf. While he was examinin~ the bottle, it exploded in his hand and
injured him. He files a suit for damages against the owner of the market on the
ground of breach of condition.
Conclusion: ½
On an examination of the bottle of cold drink, it exploded and injured the buyer. Mr
Amit would succeed in a claim fo damages from the owner of the shop. 5
5. What are the rights of the buyer against the seller if the seller commits a breach of
contract under the Sale of Goods Act, 1930? (RTP May 2020)

Ans. lftbe seller commits a breach of contract,-the buyer g~ts the following rights against

:Im
the seller:
t) Damages for non-delivery: Where the seller wron~fully ne~lects or refuses to
the goods to the buyer, the buyer may sue the seller for damages for non-
1
2)
: Where the seller commits of breach of the
to the court for a specific performance. The
only when the goods are .ascertained or
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 · b·-e-a_c_h_o-::f:--w-a--r=r~a::n::ty~o::n:-:ith:-:e::-::p~,-___
1s a r I V:-1
.. n-.ere there h of condition as a breach of \
ntY= vv•• ta breac
ch ofwarra elects to trea ads only on the basis of such
·tforbrea the~uye . rt the go
su• where •
th e seller, or r is . ct· . .
the buye ay: th warranty m1mmution o.r
warrant)', ty But he rn breach of e
breach ofwarra_n ; the seller the
aga1ns ¼
✓ Set uP the price: or h of warranty.
_...;nrtioll of d--a::iires. for breac . Where either party to a contract
~ ner f o r ~ due date.
✓ sue these tract before f delivery the other may either ½
. of the con f the date o '
) Repudiation_ th contract be ore . . th date of delivery, or he may treat
4 ud1ates e d wait ol1 e
of sale rep ct as fil!.bsisting an - es for the breach.
treat the contra ·nded and sue f r dama ff t the right of the seller or the
tract as resc1 h" Act shall a ec
the con . t· Nothing in t 1s . any case whereby law interest 1
·t for mteres . . I dama es m
5) su1 r interest or s c1a cover the money paid where the
buyer to rec ve be recoverable, or to re
or special damages may of it has failed. .
.d tion for thP p_ayment - h court may award mterest at such
cons1 era the contrary, t e . .
h absence of a contract to . to the buyer in a suit by him for the 1
Int e th mount of the pnce
teas it thinks fit on ea h f th contract on the part of the seller
ra of a breac o e
fund of the price in a case d
re . h the payment was ma e.
from the date on wh1c . ,, under the Sale of Goods Act, 1930. 4
Explain the term "Delivery, a nd it forms (May 2018)
6.
fG d Act 1930 delivery means voluntary transfer 1
th · · noftheSaleo oo s , '
Ans. As per e ~roVIsto son to another. Delivery of goods may be by doing
of possess10n from one per · f th b
an;hing which has the effect of putting the goods into the possess10n o e uyer
or any person authorized to hold them on his behalf.
Forms of delivery: 1
1) Actual Delivery: When the goods are physically delivered to the buyer.
2) Constructive Delivery: When it is affected without any change in the custody 1
or actual possession of the goods.
3) Symbolic Delivery: When there is a delivery of a thing in token of a transfer of
something else, i.e., delivery of goods in the course of transit may be made by 1
handing over the documents of title to goods like a bill of lading, railway receipt
or delivery orders or the key of a warehouse containing the goods is handed
over to the buyer.
7. What is an implied warranty, and state the various types of Implied Warranties? 6

Ans. Implied warranties· It is (RTP May 2 020, May 2019, June 2022)
. a warranty which the l . 1· 2
In other word, it is the stipulati h' h aw imp 1es int o the co ntract of sale .
1c has not b · l
·
m express words. But the 1 on w een me uded in th e contract of$
th . aw presumes that th .
eir contract. It will be interest' e parties hav e incorporated it into
every co tr mg to know that · 1
n act of sale unless they ar imp ied war r a nties a re read into
of the parties. e expressly excluded b th
As per the . . Y e express agreement
proVIs1on of the S I
warranties: a e of Goods Act, 1930 ct·
1) Warranty as t iscloses the following implied
o Undisturbed
Past exerctsed by the ll possession• If b
w....___
---•, as to the no
se er than th . uyer pay s
e buyer can cl .
d
ome amage due to
1
existing, thn-extstenee of encumb aim for ct amages to the seller.
en the bu ranees· If 1
the buyer h d Yer may claim the d · any type of liability in
a Paid. amages from the seller for

G
 _ ~ - ty- ; 5 to qa";aUty or fitness by the usa:::g~e;-;o>ff'ttrn11di~--------.--_
•,; a e:
__
- warra 0
3) seller ordinary used m goods 1 7
!~ Buyer not belief in seller'5 5k11l \
u) yer described his concern \ I
iliJ. 8Josure
u
of dangerous nature of goods: If any type of d
\
4) 01sc . h I angerous nature is \ 1 \
ent in the goods, 1t s ou-d-
pres,~~__;::.----- be- - ~ by
disclosed _the _ seller •
e the consequences of "destruction of goods" ~u~ndde~r~th~e~sw :-::;-f~G~-.---:----~---J
Whal a r a1e o oods Act 3
where the goods have been destroyed after the agreement t o se 11 b ut before' \
193 0,
le is affected?
the sa
(RTP Nov. 2020, June 2 0221 \
tion of Goods-Consequences:
oestru C
l) As per the pro~isio~ o~ the Sale _of Goods Act, 1930, a contract for the .s.ak_Qf \
I
weciflc ~oods 1s yQJd 1f at the time when the contract was made; the goods
I I
without the knowledge of the seller, perished or become so damaged as no
longer to answer to their description in the contract, then the contract is void ab
i,n.ti_Q.. This provision is based on the rule that where both the parties to a contract
1
I
are under a mistake as to a matter of fact essential to a contract, the contract is \
void.
Z) As per the provision of the Sale of Goods Act, 1930, an a~reement to sell specific 1
~ becomes void if subsequently the goods, without any fault on the part of
me seller or buyer. perish or become so damaged as no longer to their
description in agreement before the risk passes to the buyer. \
1
3) It may, however, be noted that the provisions apply only to specific eoods and
not to un~scertajned eoods. _If ~he agreement is to sell a ~ertain quantity of
unascertained goods. the penshmg of even the whole quantity of such goods in
I
possession of the seller will not relieve him of his oblieatjon to deliver the eoods.
A agrees to buy a new TV from a shop keeper for U0,000 payable partly in cash of 4
9.
~20,000 and partly in exchange for an old TV set. ls it a valid contract of sale of goods?
Give reasons for your answer.
(ICAI SM)
As per the provision of the Sale of Goods Act, 1930, goods should be exchanged for 1½
mo ney. If the goods are exchan~ed for e;oods. It will not be called a sale. It will be
considered as a barter. However, a contract for the transfer of movable property fo r
a definite price payable partly in goods and partly in cash is held to be a contract of
Sales of Goods.
Facts of the case:
1

1
The new TV set is agreed to be sold for {30,000 an d the p rice is payable partly in
exchange for the old TV set and partly in cash of {20,000 .
.Conclusion; 1½
The new TV set is agreed to be sold fo r { 30,000 a nd the price is payabl~ ~artly ~n
exchange for the old TV set and partly in cash of { 20,000. So, in this case, it is a vahd
caatractofsale,
11P. of fans of various kinds. Mr M came to his shop and asked 3
i.:...."'en Mr T showed him different brands, and Mr M
aau.11. • M M' house·
and paid for it A fan was delivered to r s '
that it was a table fan. He informed Mr T
found · that
refused to exchange the same, sayi~g
the fan and payment of the price.
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 _ 1 -e as p;;:-provision~f~~
. I t in refusing to exc 1<lllg '""'
·r Mr Tb ng J
I) Dbl uss ,1·hrtht l 9 HJ l
f / ·
S,ilc ol GlHld~ ,\ct. ', ., hie to Mr M7
•• ncd}•,nai a
(RTP May 2021, Jan. 2021 )
~--
ii) Wh,lt is tht• ltl - - -9-30where the goods a r e ~ ½
ilc of~
I I '
Act, l d·t·on
uo.ods· lied d t· d
--r _- ion-of.t 1-:-
H •s• con • • is that the goo s supp 1e
I Ans. l ,\s iwr tht' pn1v1: b , dcscnption, the unp C descriptjon. In case the goods do not
:tJ.lllJlk as wl'II .,. ~10th the _:i,rnmle s1m_1 th d cription or vice versa or both, the
/ ·hill corrt'.~pond to . le or with the es
s , . •~pond to both with the s,unp ' h" h h
I com. d. re the rontract. h articular purpose ,or w ic t e
I bu,\. t•r 1:-.111 [t'J)ll liJ. • to the seller t e p
. ~
. . h rlnh.
tor skill of the seller, it is t e ½
Also. when th e buyer makes known
I aood~ I on the Judgemen
ire required. and he re ies e reasonably fit for that purpose
II at:'> the seller
' I
to supp Y sue •
h ooods as ar

I The facts jn the case: d of fans of various

. k.mds . Mr M came to his shop and asked
/ Mr r '"as a retailer tra er . T h wed him different brands, and Mr M 1
fi r the kitchen. Mr s o • h
I for an exhaust 1' an °
rt Jar brand and pa1.d fior I·t . A fan was delivered to Mr M
s ouse;
I at
approved ofa pa icu h fi d that it was a table fan. He informed Mr T
I the time of opening the packet, e oun
I about the d eI1very o fth e wrong fan . Mr T refused to exchange the same.
Conclusion: h i: fi
iJ Jn the given
· case, Mr M h a d revealed to Mr T that he wanted the ex aust 1an or
I the kitchen. Since the table fan delivered by Mr T was unfit for the purpose for
½
I which Mr M wanted the fan, therefore, T cannot refuse to exchange the fan.
I ii) In the present case, the remedy available to Mr M is that he can either rescind
the contract or claim a refund of the price paid by him, or he may require Mr T
to replace it with the fan he wanted. ½
11.
Jsold a machine to K. Kgave a cheque for the payment. The cheque was dishonoured.
4
But J handed over a delivery order to K. K sold the goods to R based on the delivery
order. J wanted to exercise his right of lien on the goods. Can he do so under the
provisions of the Sale of Goods Act, 193 O?

Ans. (ICAI SM)

As pe.r ~e provision of the Sale of Goods Act, 1930, The right o f lien and stop p age in
transit 1s meant to p~otect t~e seller. These will not be affected ev en w h en the buye r 1
has made a trans~cnon of his goods which were With the seller under the lien. But
I under two excepti onal cases, these rights of the seller are affected -
1) When the buyer has made the transaction With th
2) Wh th b uyer has made the transaction base,d_ eon consent of the seller
. .
. en e do ½
bill of lading, railway receipt or a de!iv d cuments of title such as
facts PCthe cas~ ery or er etc. ½
J sold a machine t K K
But Jh d o . gave a cheque for the payment Th

~d:,
10
an ed over a delivery order to K K sold th
R
. e cheque Was dishonoured
J wanted to exercise his right of !~en on th e goods to based on the delivery.
- D Yft91t e goods. 1
the Present cas J ·
...__ be e, is entitled to exercise the right of Ii .
~ • ; n the W!curneat of ti tie to the h-e~, hut his rieh I Of!ien delect:,
ased on this docum ~ - The buy h
n of sale based .ent of title to the bu er as made a
o~l'this document. So,
. fl I
R, ::;• ;nd the buyer has 1
I . II ' I .Ii • as Purchased the
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 -~1gentof a buyer, had obtamed the g~I f. __

1
2·

J
\ i\'ho
t,
nd oa
nouc
ent Referring. to
111so Iv . .
I

the prov1s10ns of the Sale

•,
oc s tom the Ra·1 -
' I way Authorities
I ded the goods on us truck. In the meant11nc , ti1c'R a1·1 way Autho
a . e frol11 8, the seller, for stopping the goods in l t_,1ns1t as the hu nt
of C 1. Act, 1930, ycr
,ooc s
•
.I
hes received
as become
decide h
•7 I
owaY Authontics can stop the goods in lnnsit 1 . . • w ether I
the Ra ---~ , . , s tnstructed by the seller?
---~- --~ (ICAI S
i\s. per the provision. of thef Sale of. Goods Act, 1930 ' then ght o f stoppage
-- of goodsM)
in.-----'
tr, nsit [lleans the nght o stoppmg
. . the goods after the se)ler h .
-- . as parted w1th the ½
1
~ - After that. ~he se 11 er I ega11~s possession of the goods.
' be exercised by an unpaid
is· can . seller when he has lost his r·ight of 1.1en over the
Th
goods bec~use the i:oods are w
de)_ ered to a carrier to take the i:oods to the buyer. ½
This right 1s available to the unpaid _s~ller only when the buyer has become insolvent.
The conditions necessary for exerc1smg this right are:
1) The buyer has not paid a total price to the seller. ½
2) The seller has delivered the i::oods to a carrier, thereby losing his right of lien. ½
3) The buyer has become insolvent. ½
4) The i::oods have not reached the buyer: they are in the course of transit. ½

facts of the case:

1 A, who is an agent of a buyer, had obtained the goods from the Railway Authorities
1 and loaded the goods on his truck. In the meantime, the Railway Authorities received 1
a notice from B, the seller, for stopping the goods in transit as the buyer has become
insolvent.
Conclusion:
In the present case, the railway authorities cannot stop goods because the i:oods are
1
I not in transit. A who has loaded the goods on his truck is the agent of the buyer. That
means railway authorities have given possession of the goods to the buyer. The
, transit comes to an end when the buyer or his agent takes possession of the ~oods.
6
' Mr G sold some goods to Mr H for a certain price by the issue of an invoice, but
13.
payment in respect of the same was not received on that day. The goods were packed
I and lying in the godown of Mr G. The goods were inspected by H's agent and were
found to be in order. Later on, the dues of the goods were settled in cash. Just after
receiving cash, Mr G asked Mr H that goods should be taken away from his godown
to enable him to store other goods purchased by him. After one day, since Mr H did
not take delivery of the goods, Mr G kept the goods out of the godown in an open
space. Due to the rain, some goods were damaged.
Referring to the provisions of the Sale of Goods Act, 1930, analyse the above situation
and decide who will be held responsible for the above damage. Will your answer be
different if the dues were not settled in cash and are still pending?
(Modified July 2021, Nov. 2018)
1
Ans. As per the provision of the Sale of Goods Act, 1930, when the seller is ready and
willin!l to deliver the e;oods and requests the buyer to take delivery, and the buyer
does not within a reasonable time after such request take delivery of the goods, he
is liable to the seller for any Joss occurred by his nei::lect or refusal to take de)iyery
and also for a reasonable charge for the care and custody of the goods.
The property in the goods passes to the buyer at a point of time depending upon 1
ascertainment, appropriation and delivery of goods. Rjsk of loss of e;oods vrima facie
. Goods remain at the seller's risk unless the
I I I . ll,_,_. I I I

ts transferred to the buyer, but after the transfer of property therein

are at the buyer's risk whether delivery has been made or not.

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Ml DUAL CAMER~
 -Mr 11 that he wanted to store sumt: l
lrcadY inti01at_ed of oods kept in the godown of I
. Mr G has a k the deliver)' g
se since Id ta c b Mr H.
I the given ca . Mr H shoU Id be borne y
n ds and thus cd shoU
other goo fgoods damag h _ cJ some amount woul d have
the toss O d cas an
r,1rG, d ot 11avcsettle Ill • ·cJ cller, and he C"an enforce th e
ds woul n d an unpa1 s

I!fthe Pr
been pc
ice of the goo
nd1ng, then
~ !lowing rights aga
Mr G w1
inst the go
·11 be trcate ns
ods as we
ct of sale, the l2il
II 5 agatn.
a
1
pectY IQ
. st the buyer personally:
. U 1 ~ rnods has passed to the 12.u.Y.''t
•
to nay for thC' ~<ll.!.ds according l<,
contra . oLI~fuses -- .,. f I d
I l)o Whcreun12.Udc•err awrore fully aeeJects
•·· ~ ay sue
h. for the pric:e u t 1c goo s.
1m .
and the> t ·act the seller 01 . ble on a certnjn cJay 1rrespcct1vc
I the term s of the con I • h nricc JS paya --- - -
tract of sale. t e ~ r refuses to pay such price, the
h e under a con f lly aee)ects O - -
2) W er_ d the h,uyer WC9Dfl Y h property in the goods has not
I of delivery, an rice althoug 11 t e
seller may sue him for the pt been appropriated to the ~ r a_c_t.~ - - ~ -
I passed and thego ods. haves noer the - - - - - 1930 .
Sale of Goods Act, 6
1 . therulest0Auct10na P (Jan.2 021)
14. Exp arn --~ 1 f h .----
I f th Sale of Goo d s Ac , t 19 30 ' rules to regulate the sa e o t e 1 Mark
Ans. I As per the provision o e for each
auction are· - d re put up for sale in lots, each lot is point
1 ) Goods are sold in lo ts: Where goo s a 1
I . deemed to be su bJect to a separate contract of sa e.
· a facie -
prim
Z) Completion of the contrac t O f sa le· · The sale is complete when the auctioneer
I announces its comp Ie t10n . bY the -- fall-- - of the hammer or .in any other customa ry

I manner, and until such announcement is made, any bidder may retract fro m
his bid.
3) Right to bid may be reserve d: Right to bid may be reserved expressly by or
on behalf of the seller, and where such right is expressly reserved, but not
I otherwise, the seller or anyone person on his behalf may bid at the auction.
4) When the sale is not notified by the seller: When the sale is notified to be
I subject to a right to bid on behalf of the seller, it shall not be lawful for t h e sell er
to bid himself or employ any person to bid at such sale, or for the aucti oneer
knowingly to take any bid from the seller or any s u ch person, and a ny s ale
contravening this rul e may be treated as fraudulent by t h e b uyer.
5) R~served price: The sale may be notified to be s ubject to a r eserved or ups et
~ -
6) Pr_e ten:ed to _hid:_If the seller makes use of pretended bidd ing to raise the
15. ~ t e sale is v01dable at the option of the buyer.
A agrees to sell certain goods to B on a .
10 days expired, and goods were till . certain ~ate on 10 days credit. The period of 5
ofth d s m possession of A B h I
e goo s. B becomes insolv t A · as a so not paid the price
fl' en
o ten on the goods. Can he do sou d
refuse t ct r
o e iver the goods to exercise his right
Ans.
As pe~ the provision of the Sal f n er the Sale of Goods Act, 193 0? (ICAI SM)
who 15 • • e O Goods Act 1930 .
followtngcas . · itl · 'pro:1des that the unpaid seller ½
es. e to exerc 1 e .
l) Where the &OOds h e n ht of lien in the
2) Where~- ave been sold urith
outanysti 1 .
_. •-.._.__.hasve
wae&oodsha b
~
een sold on
l2eco .
.L!J __
Q: d. b pu at1on as to credit
e Jt Yttheterm Of 1
me 1Dso1vem even th credit has expired 1
ough the p ·
enoct of credit has not 1

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G
 ---- - - ~--------------
~ r t a i n goods to Bon a certain date on 10 days credit. The period of
-----

/ r\l (),ign._t.- ,,pired. and goods WL're still in possession of A. B has also not paid the price
.
d,l) s [ r B becomes msolvent. .
A refuse to dellver the goods to exercise his right
O(i
I ll .
fthr go "
ll f IIt'll
on the gooci·s.

I :
~r1usiolll
A h,1s a
greed to sell certain goods to Bon credit 10 days. The period of 10 days has
. . .
. . s has neither paid the pnce of ~oods nor taken the possess10n of ~oods. That
1

expllCl. 1 . . . .
_ the goods are still physically m possession of A, the seller. In the meantime, B
,ne,Ul 5 '
the buyer has become jnso!yent. In this case, A is entitled to exercise the right of lien
the goods because the buyer has become insolvent and the term of credit has
011
~pired without any payment of the price by the buyer.
4
suraj sold his car to Sohan for :{75,000. After inspection and satisfaction, Sohan paid
16, US,000 and took possession of the car and promised to pay the remaining amount
within a month; later on, Sohan refuses to give the remaining amount on the ground
that the car was not in good condition. Advise Su raj as to what remedy is available to
him against Sohan.
(Modified July 2021, ICAI SM, RTP Nov. 2020, RTP Nov. 2019)
½
As per the provision of the Sale of Goods Act, 1930, an unpaid seller has a ri~ht to
Ans,
institute a suit for price a~ainst the buyer personally.
i) Where under a contract of sale, the property in the goods has passed to the
1
buyer, and the buyer wrongfully neglects or refuses to pay for the ~oods. the
seller may sue him for the price of the goods.
ii) Where under a contract of sale, the price is payable on a certain day
1
irrespective of delivery. and the buyer wrongfully neglects or refuses to pay
such price, the seller may sue him for the price. It makes no difference even
if the property in the goods has not passed and the goods have not been
appropriated to the contract.
Facts of the case:
Suraj sold his car to Sohan for :{75,000. After inspection and satisfaction, Sohan paid
't25,000 and took possession of the car and promised to pay the remaining amount ½
within a month; later on, Sohan refuses to give the remaining amount on the ground
1
that the car was not in good condition.
Conclusion:
This problem is based on the above provisions. Hence, Suraj will succeed against 1
Sohan for recovery of the remaining amount. Apart from this, Suraj is also entitled
to:
1) Interest on the remaining amount.
2) Interest during the pending of the suit.
3) Costs of the proceedings.
17. ~m sells 200 bales of cloth to Shyam and sends 100 bales by lorry and 100 bales by 6
railway. Shyam receives delivery of 100 bales sent by lorry but before he receives
the delivery
. of the. bales sent by th e rai·1way, h e b ecomes bankrupt.
' ·
Can Ram exercise
the nght of stoppmg the goods in transit?
(Dec. 2021, ICAI SM)

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 I. 11t11g \\•Ith 1'u; n~hl
ot stuullll¥1: 11~
,I <;"odi., i ,
\ 1
1
1 JJO,' l • <1ht
""lier, tht.• 111,
,s cxcrds,iblc, uyUii.:.
the Sile< "' 11111' ,111
r11'Cl\ tslOII ol iililhlC 111 • • 1111tilt'd , IL

Ans. A,p1r1hr.l ua11s.1til'• 11111111s1111 ,,

-Antis ll I (lilt IL
cl tlU: ~ "' 111l h•",tng l l!ll.U.U:i ,,
_,.itcr (11\l)' If ti I ht' .UlUhlld • l~c.!:i:;,Jull O I~
,u..i- r.lh'l n111~ I ,,·Ith tht
I) Th<' '
11) Ur. 1111•'' I
I ,,·1• I' II I ('I il
I ht' Ill Ui.lllSJ I :iJ,llV!.:_lll I 'Ii
½
Ill} Thr. Ao1•1h 1111::, h ,,·1• ht'l 111111• ~~~o_Lilic..UW..•
1111
I ) Thi• IHI) ('I Lu·'•' ' ti.I. we.JU.ID' I y lo1·1·y illld I 00 bnlcs by \
' 1 11 I!. 5Jl u.,-,
1 ()() Ii tl1•s l
, l Tl11' ig ,nd sl'11cls 1 ' l>ul IH'fol'c he receives
• · Qt Ul~~ 11th w ShY•""' ,..; st•lll hy Jon y,
[a_~lb illtl t1,1ll'' ,111 I I •lh'crv ol I (H) 1i.1lt . ·1 •C()tlll'~ h,1111<1 upl.
R 1111' \ I l'l t•l\' l''i l t • 1 1· iilW,l)', ht• H
' ,ti\ an l h\' t H' '
ra1h,,n . , ~ ,, 1till' t,,1k-. ,n
st
· b,llcs ul cloth sent b,y
thr. clrh,'l t) I c,111 stop the 100
'""""·hr,~
~ . R1m bc111g •
• sttll unp,lll •
t 1 the prt'"t•nt c,1st'. '. .
t
, sqll in transit- . --: I
• m:,tlwst' e@lh.:!!.!..-- - - -nvo\ved ,n the sac
,-;f unascertained goods and \ 4
m1hVd) ...._ - - t ' ii elements 1
.... •cssen 1. O ) \
18. Statcthe\-anous . . (Nov.2019,May2 18
their appropnatwn. - - 7at~ ' of goods involves___½_._
1930, approp1 t,
the prov1s1on
_____ -----:-:. -:-:.:-: -- °
f the Sa le of Goods Act,f usme them m
SJ~Jl:~lll . ·uJtJJh~e~p~i._er~f~o~r~n:1a:1~1c~e::o:f_tl~1e
Ans. As per . Of ds with the intention o d Her. The essentials are:
the se)ecnoo goo sent of the buyer an - se
rnntr:1rt and with the mutual con rtai·ned or future ~;oods.
~ th le of unasce ------- • l t t
1) There is a- contract forf e sa t the descnpt10n an_ QY ·~m:.u·
m·:m.andsuliaLl.lility_y~si..l..taat1..Sead~m,L_\:Jt~1e,._...c....o~n~r~a_c .
2 The oods should con orm o
3)) The ggoods must bem · deliverable state. • · t
a ( d' t' guished from an intention o
4) The goods must e YD b conditionally as is m h •
'th by delivery to the buyer or 1s
appropriate) approprjated to the contract e1 er
agent or the earner.
S) The appropriation must be made by: ½
✓ the seller with the assent of the buyer. or
✓ the buyer with the assent of the seller.
6) The assent may be express or implied.
7) The assent may be given either before or after appropriation.
19. State the essential elements of a contract of sale under the Sale of Goods Act, 1930 3
briefly.

Ans. (RTP May 2021, RTP May 2020)

As per the provision of the Sale of Goods Act, 1930, the following elements must co-
exist so as to constitute a contract of sale of goods: -
1) There must be at !east two partjes.
2) The sub!ect matter of the contract must necessarily be ~oods.
43)A pnce in money (not in-kind) should be paid or promised.
)A transfer of pro pert.¥ in O i . r.I
S) Acont g oc s om th e seller to the buyer must take place.
6) All thract of sale must be abso!uti;, or conditional.
o er cssential elements of a valid c: .
20. of sale. --- ontract must be present m the con tract
~fll't the rights of an unpaid seller .
st
- - -------~-
,. agam goods under the Sale of Goods Act, 6

(Nov. 2019)

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 AS pct tlH' pl 11 v1s11111 ol !ht S;-ih• nl {,oncl /\1 I, I ri ill · lhl' 1111 11 111l ~ II 1 r ha tlw \
·I , ,.,h ts ,1g,1111sl lhl' good•,
1 's"I •h•n: s11hj1•1 I I II I h1• I'' 11vl•.11111'l 111 I h I•, ll I ' I ht .Ull"
J) ;,,., CII111CI ·.1,1 r "ll"J II I r110(l ' who \

u~~w\
1111111\\ lLfill,LJ!.w "

~ , sM'Ssic111111l\11'1111s 1•11till1•d lo ll!l.llll. 11.WlliClilillUl ol thPsll ~

""IILII
1111 11
I,u::nd1;.L1ll th!!,Jl! l!.J! 111 tht• lo llnwt11g 1 ,1 ,I'll
l) wlH'l l' 1lw goods h,1v1• I11 .-11 :&Id w1ll1illl1JlllY !iihrulUlll.lli..ul lJJ .1,J.J,jjil.: \
Ill \\'hCII' tlw goods h 1v1• lw111 ru.ili1 U.ll !.JJ.:.illt h11t tht• icimQLJ.i..c.dil..llil!i \

r~~: I 'h
II I) "h,•n• I\w lm>'i!r \l£l..O Ul<>Jll>olSClll, I
I\') TIH' seller 111,1\' ci.:1•111<;1• hi'.J I 1ghl ol 111 11, auJ.wJ1luaamlrn1' that he In I
1

'h
l ~Q1Lu.Llhc...1!!.1.Uilli ,,s .m um:nt m ~ to, 1hc huyrr. \
l) Right o l Stopp,tgl' In T~,rnsit: Suh1c1 t lo till' p1 ov1sio11s of this net. when the
b.._~~·.l'.-.~QQlliU.l..~(QJll~JlUi..ULV:cni, the unp,11d seller who has uarJ.cl...wiltuht:.
~~uuot the goods has the rn:ht ofslu,uu,ing them in.lJJ.UWl, 111' may~™ \
l jll)S::rss10n ol the goods as long ns they arc in the course of tr.illlfill anc.1 mc,y a:.laln \
them unul p_aid or tendct:cl the price of the goods. \
4 The right of stoppage 111 transit is the extension of the right Q.(Jkn because it I
entitles the buyer to re~ain possession even when the seller has parted w.ilh \ ½
wepossess10n of the goods.
The right of stoppage in transit is exercised in the following conditions only-
\
\
i) The seller must be unp_aid. I ½
ii) He must have parted with the possession of the goods. I ½

I
in) The goods ace m tranSlt-
iv) The buyer has become ioso)vent. ___
-----21-.~-M--sG-e-et_a_~ local rice and wheat wholesale shop andasked for 100Kgs of \
I
J-6 - 1
½
h

Basmati Rice. The shopkeeper quoted the price of the same as H25 per Kg, to which \
she agreed. Ms Geeta insisted that she would like to see the sample of what will be \
provided to her by the shopkeeper before she agreed upon the purchase. The
shopkeeper showed her a bowl of rice as a sample. The sample exactly corresponded

to the entire lot.

½ The buyer examined the sample casuall y without noticing the fact that even though
½ the sample was that of Basmati Rice, but it contained a mix of long and short grains.
3
The cook, on openi ng the bags, complained that if the dish is prepared with these rice
would not taste the same as the q uality of r ice was not as per the requirement of the

I
dish.
Now, Ms Geeta wants to fil e a suit of fraud against the seller, alleging h e of selling a
mix of th e good a nd chea p qu ality of ri ce. Will sh e be successful ?

Decide the fat e of the case a nd options opt•n to th e huycr for gri evance redressal.
What would be your a nswer in cas e Ms Ccl'ta speci11etl hcl' exact requirement as to
the length of rice'!
(July 2021, Nov. 2019, ICAl SM, Nov 2021 RTP)
ADI. Al per the provision of the Sale of Goods Act, 1930, in a contract of s,,\e by sample,
._.II• lmplltd condition:
lhall @uespond with the sample in the quality:
1

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 iuwrWai~ ofcompariai: the bulk With the
II have a ~
2) the buyer sh,l cl!Xt rendering them un-mcrc~~ntablc, Which
sample. I sh:i 11 1>C .u,1,J;.liJ
M> tDll)l.ilnYJ.l ., 1,. ,,. inn of the s.i rnple. 1 his condition i
WC.J!XiUwlu. Lul,U..I. s
s
Also, the goo( nppurcr _,..,1, 1 nQL be cljscuycrccJ by ;in OrdinCJry
ti Oil ,l ~ l l i l, ·ts th,rl l,.U.Wli-U,
I 11
\~oulcfnotlt°!• f'g,irdtolctc . .. · •lil1.Cl_lL,thenthebuyercan~
1!1c,1hlc only wit 1t , l 11111, if the cit'fc( t :; ,11 c
a P, I the gooi :;.
cxc1n1111,111011 o

. s"'.
of U•c cJ -~ les•tf p s hop ;rnd a skPd for 100 Kgs of
• t 1111 1 1tc·1t w,10 · '
l

fDcr.:a 1.., Wl'lll to local rit'e • w ' • price of the same as t 125 per Kg, to which
Ms ,cc" k ,,rquotc( 1 111c I f h •
Basm,1t I HJCc · The shop. ecpt .5 1 that she wou Id like to see the samp e o w at will be
c:hc agn,,... 0· Ms Gccta 111sr 1le, keeper b c,o " re she agreed upon the purchase. The
·pro\it•ded to her by the sbowl . as as ample · The sample exactly corresponded
,op of rice
5 hopkecper showed her a . d th sample casually without noticing the fact
h b yer examine e . .
to the entire lot. T e u f Basmati Rice but it con tamed a mix of long
h h sample was that o ' . . . .
that C\•en thoug t e . the bags complained that if the dish 1s
The cook on opening '
quality of rice was not as
and short d grams.
'th these nee. would' not tas te the same as the
prepare wi d' h N
ow, Ms Geeta wants to file . of
a suit f fraud
. agai nst
the requirement of the 1s
per seller, allegmg
the . a mix of the good and cheap quality o nee.
. he Of se 11 mg

Conclusion;
Mrs Geeta cannot filI ea su1·t of fraud against the seller, alleging him of selling a mix
of~ood and cheap Quality rice. Since the defect in the rice can be discov~red 1
throueh ordinary examination. Hence, Mrs Geeta does not have any option
available for grievance and redressal.
If Mrs Geeta specified her exact requirement as to the length of rice, then the sample
she was shown must correspond to the bulk in terms of quality and length both. If
the quality or length had mismatched the sample, Mrs Geeta would sue the seller for 1

22. When can an unpaid seller of goods exercise his right of lien over the goods under
7 4
the Sale of Goods Act Can he exercise his right of lien even if the property in goods
has passed to the buyer? When is such a right terminated? Can he exercise his right
even after he has obtained a decree fo r the price of goods from th e cou rt? I
Ans. As per the provision of the sale of Goods A . . (ICAI SM)
1930
.. :"o"":ds"""v....o.u-··
-2f:e":o' .1th.ue4.-:-~-
.t.u.il.1--- }:'. en_ 0 :.the_p,fk
nlt;!al.YIDirn..tJruf t e pnce . i ct, ·1 bl, A hen a right t o r eta in possession
· 1t ½
who Is in possession of them where-= s avai a e to the unpaid s eller of the goods
1) The goods have been sold with;ut a .
2
) The goods have b ny st ipulation as to credi,t.
J) een so Id on credit b t .th ½
The buyer becomes ~em , U e term of cre djt has expi red. ½
The unpaid seller ca n exercise ..· .·
of the buyer. He . his nght to lien ever ·r I . ½
agent orb II can exercise his right even 'f I . 1 _1 t 1e property in goods as agent ½
1 1e 1s rn Jlo .
r....... _...a eeofforthe
--._....on Hen• A uyer.
b .
ssess1on of the goods as an
I) When be de . n unpaid seller I . ' . .
Uvers the good oses hrs right of a lien ti . .
to th s to a carrier , 1e1 eon.
t: - e buyer Without reserv· o1 other bailee for the purpose of
ror his ag b,..,.... tng the ril!ht f
e n t ~ obtains ~ .0 disposal of the goods,
•1vag the I b Po.ssess,on of the d
½
- -- eo 0 . .s._ __J__ ½
lien.________
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G1
 ----=-;ercis~s right oflien even af'r';te;r:-jhue;ih~ai;s~oJibntait~rld"";;k::-::-;:----:---
he cane · ne a decree for --Pnce
the . I
1vcre d Bon a sale andl~r~e~tu~rn~b;as~i~s~Tflh~e~ag;:-;;~~~~~~;~i
~. . greement provid d ___ 1
A de I the horse for 8 days and return if he did not lik th e that B \ 3
should trY rse died without the fault of B. A files a suit aga·e eBhorse. On the third I
dilY•
the h0
he recover the price?
inst for the
recovery of
\ I
I price.can \
I
--- -- (ICAJS
f the Sale of Goods Act, 1930 the rjsk f0 II M)
I sp Ib • ' ows the ownersh·1 l 1 \
,.11s, I
,-1 A
under
the sale on an approva as1s, goods custody transfer but
,
. . - P· \
ownership is not
I ~ ns ferred. I
\
I
I ~
A d
el·vered
1
t:e
h~rse to B on• a sale or return basis. It was decid e d b etween them \ \
that Bwill trY the horse for eight days, and in case he does not like 1-t, h e w1.11 return

I
.
the horse to owner A. But on the third day, the horse died without any f au 1t of 8. the \
1
I
ume given by seller A to buyer B has not expired yet.
~ . of the horse still belongs to seller A. 8 will be I
In the present case, the ownership
considered as the owner of the horse only when 8 does not return the horse to A \ 1
within the stipulated time of 8 days. The suit fi)ed by Afor the recovery of price from
is invalid, and he cannot recover the price from B.
8
, The buyer took delive ry of 20 tables from the seller on a sale or return basis without 4
24 examining them. Subsequently, he sold 5 tables to his customers. The customer
lodged a complaint of some defect in the tables. The buyer sought to return tables to
the seller. Was the buyer entitled to return the tables to the seller under the \
provisions of the Sale of Goods Act, 1930? I
(ICAI SM, Nov 2021 RTP)
Ans. As per the provision of the Sale of Goods Act, 1930, m case of i:oods on an approval
basis, the property in goods passes from the sel)er to the buyer
Ii) When the person to whom the goods are given either accepts them or does
1

an act that implies adoptine the transaction.

ii) When the person to whom the goods are given retains the goods without
1
giving his approval or giving notice of rejection beyond the time fixed for the
return of goods and in case no time js fixed after the lapse of reasonable time.
Facts of the case:
The buyer took delivery of 20 tables from the seller on a sale or return basis without
examining them. Subsequently, he sold 5 tables to his customers. The customer 1
lodged a complaint of some defect in the tables. The buyer sought to return tables to
the seller.
Conclusion; nd
th
In tbe present case, the buyer is entitled to return only 15 tables to e seller a nQ1
those sqhles which be has already sold to his customer. These tables are already 1
~ by him, so er e ctrin f v · 4
xr=~~.;;::.:
..... --- h'
of wheat from y out of a larger stock. X sent is men
ks Then there was a
wheat were put into t h e sac . ?
tted Who will bear the loss and why.
SU · (ICAI SM)

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 ~ . Act. t 930, if the ~oods are not 1n ...
,tc of (,ocll 1s "-'---"
• ll ovi:;fon of tht' s, . th~•i'r of specific goods. the property does
As per the I I thl' t o11lr,11 t I'; [U,.1:.!
r ,\nS,
I • , - ~ s1,11e ,11H
~clll'.J,:
1101 p.isS 10
". .
thr 111 1yr1 1111h ss,
tone• ltis ,11 I nl p11I 1111g
.
. , 1111 , l'ood~ in a !,lcllycrablc state
, ½
I II) Tiu• s1•tlc1 It is t
.. • yrr 1t.1s l,nlillililli
11) 11ll 1111 •
, •d JI!, u_i ll,

•11iin•dl111n11 1
,11 tin .irl s so m; to put the goods nrc not in a
i ••
½
ctf111cs the• s,,th is,, I . . ·0111,llrwrs t•ll', No prop<'! ty tn goods passes
I I so111 I
'111,1• p,1ck111g, f1l111g 111 ' . ½
iii II\ cr,1lili' s1,11t I I I • h11v1•1 lwow~ ,1ho11t ti.
I I unlrss s111
f.llCU of the~
h tn ,11 t b don<' ,1111 11
,
, 110111 y 011I of a larger stock. X sent his men
• , • HH) tons 11 1 W 1H •11
x 1gri·c•d 11 1 1111 11 11•1 1 • , wi•n· put into the sacks. Then there was a
I< 1 1r.o tons o 1 w 1H •11
"1th tlw "·11 •• ,IIH ·' , ... 1
... ,, ··• ··• .. ,.1, JYilSJUili.\.iU•
sucldrn fir<', ,ind IIll' ~ I L ~
r nclusiolli
llo , ns' sale h,is 1,1kcn place. So, buyer X w1·II b e rcspons1ble· for
tlw pl r:-.cnt t ,t:-.i' 150 10 • · · Ib h f II Y
111
br.,uing till' los:-..
•
~he...u.
.. ·r1 H, 1oss· · ot .!J.i..J.l._ rest
........""'--'~
at O se er.
of the. wbe.1t wtle t .. 1
· I .. )ttt · the s·1cks fulfils both the cond1t1ons that are:
The" h1•Jt wI11c 1 \\ .is l 111 '
1) The whcJt is put in a deliverable state io the sacks.
Z} The buyer is presumed to have knowied~e of it because the men who put the
wheat in the sacks are that of the buyer.
Mr o sold some goods to Mr E for :{5,00,000 on 15 days' credit. Mr D delivered the 6
26.
goods. On the due date, Mr E refused to pay for it. State the position and rights of
Mr Das per the Sale of Goods Act, 1930. (May 2018, ICAI SM)

Ans. As per the provision of the Sale of Goods Act, 1930, the seller of goods is deemed to 1
be an 'Unpaid Seller' when the whole of the price has not been paid or tendered, and
the seller had an jmmedjate ri~ht of action for the price.
Facts of the case;
Mr D sold some goods to Mr E for :{5,00,000 on 15 days' credit. Mr o delivered the ½
goods. On the due date, Mr E refused to pay for it.
Conclusion;
Position of Mr D: Mr D sold some goods to Mr E for :t5,00,000 on 15 days' d't M
D delivered the goods. On the due date Mr E f d ere l . r
unpaid seller. ' re :µse_ to pay for it. So, Mr D is an ½

Rights of Mr .o: As the goods have parted awa fr

exerqse the Dibt aiainst the aoods· h Y om Mr D, therefore Mr D cannot
1e M E h. •----· e can only exerc· h' · ' 1
·· r •• w tch are as under: ise is n~hts a~ainst the buyer.
Suit for a price: In the mentioned cont
;~1t
7;rE:;ruses to pay such price; M~a~t~~sale, the price is payable after 15 days.
mages for non-accepta Y ~ Mr E for the price
1
acceptance if Mr r nee: Mr D ma ·
Suit for Interest: ~f~~~1::f~1_lly neglects or refuses ~o~ Mr E for dama~es for non- 1
lQtcrest on the price of ~b~') ~o s1~ec_ific aerecnwm b~ct~P~ and pay for the goods.
Mr D may charsc Interest P~ o~ f1 ~m the elate on . een Mr D and Mr E as to
ma to Mr E. 0 th e PnCi'. when it b which payment becomes~ 1
'1:1. DlftntAlcertaiiiedand Unas ecomes illlC. from such day as he
-
--_.,...___ certained G
<>ods wit}~ ~--------+-~-
example each. 4
(Nov. 2018)

REDMI NOTE 5 PRO

Ml DUAL CAMERA
 Good• are those goods that are ld9ngtft,cl In accordance
~11td ht aJOtntct o(aale Is made. In actual practice, the term 'IMerteteed
~,ttirt , lfl d ' ---
'; r:-i,. ,d In the une "" (' as spec c IPA •· When from a Iara• number.,
11
I• "s .aaudi, the numhcr or quantity contracted for 11 l4tnt1ft,ct IUCh
d r
•', 1ll11d ~talncd aUJ.td.s.
~ a
,.,1n~•"
-~ ooO !i
"lll'" to
Apcrso 11 "
, v,•gr1ahlt• 11101 kct and demand 2kgs of tomatoes un..-n
. ""• 1
111rle J1jll'lil.l~ 2l<gs ol to111,1hws In nu ordance with the agreement, the
, ncr aJlJ1l tatuc_d
b<' ,,nc ~ 1
aoods: I hl' goods whh h 111c nut spedHcaHy ldentJQed or 1
certalne d "
llrt~~"•ncd nt th£' trnw ot thl' rna1<111g 111 the contract arc known as 'unascertalned
~ r<' indlc.,tecl 01 dctrned only hy dcsq Iption or sample .
•,.J\l'ls The)' 11
poi- ,· gr ccs to c;cll Y une bag of wlH'a l out of hundreds of bags placed in 1
.;irnplc •' ,
' d \., 11 which 1s the sale ol u11<1sce1 tamed iuods because it Is not known
( her go O ' • --
:h bag IS to be delivered.
" d C "as Joint owner of a truck, and the possession of the said truck was with 4
l AB an . .
!l
!: urchased the trud< fr om B wrthoul know mg that A and C were also owners of
!uck. Decide in the light of provisions of Sale of Goods Act, 1930. Whether the
sale bet\\een Band Xis valid or not'!
(ICAI SM)
us-. As per the provis10n of the sale of Goods Act, 1930, sale by one of the several joint
owners 1s valid if the following conditions are satisfied:
I) One of the several joint owners has sole possession of them.
I If) Possession of the goods is by the permission of the co-owners.
ill) The buyer buys them in good faith and has not at the time of contract of sale
knowledge that the seller has no authority to sell.

Facts of the case;

AB and Cwas joint owner of a truck, and the possession of the said truck was with
B. Xpurchased the truck from 8 without knowing that A and C were also owners of
the truck.

Conclusion;
s The sale between Band Xis perfectly valid. In case one of the several joint owners
has th e possession of the goods by the permission of the co-owner. If the buyer buys 2
1 tftem in &Qod fajth wjthout the knowledKe of the fact that the seller has no authority
sen u
w will give · nse· to a valid contract of sale.
~tare the implied conditions under a sale by sample? (RTP Nov. 2019, June 2022) 3
per the provis1ons
by th
•.
of the Sale of Goods Act, 1930, implied conditions under a sale
e sample are:
I) ther 15 1
e an lmpHed cgndtttgu
quality•
U) ,
there ls another

IU) It ls furtb
da1...... _ er an
-uililllnthe

-.~EDMI NOJliE_...s PRO

• 0 Ml DU~ ~ CAMERA
 josh! o-;--sale~ ~
h h u d e d r ,;er ti Mr l!Ultn --....._
I I whll II LOI t I LO Mr Lanesh M Preeu no ~
'
r ti u , um -·• d Lh ntu \-. Ill h 'iUl.t ed l Referrtng to lhw
ao. M I
I Aft ,
Mr 10 hi plt:u(JL
Mt ,, n 11, h e
IJ 1.Jtur ci.11 110111 W d c.:ld ncl examine w o.1t recourse ls
clnl111 htil 11 r ltC' 111 I Ar I I lJ ,
r 111 IJ ( 1 ,!Jill
11( 1(11
p111VI (IJII
(If.Al SM, Nov. 2020, RTP May 202l)
ivnllnlilt '" ~1 (11 ii
, w when nuods nr'C' delivered to the -
I nl 1.,,1od A• I, 1 1 , I
vi 1011 nl till' u c " uth1 r I,nll II LU ms, t 1e property therein
"" II' I I III
Alli'!, p11J
I "1111 II 1Il 1JI,, 1111 II 01
l111}'• I 1111 q1p111\I I lll

P•' I' II 10
I) V\llll II'"''
"
l111y1 I

i,11yri1 lg
•11IIIL ltl 1(11''
.ru:.iliW
,,v
11 01 tlll~pt Jll(( LO thl' elkr or does ,1nu
--.i.

, ,.,,
1
n1...Uul 1pJ1LU! 1.lu.:._lljll.lL 31 , c,,1 rnr Lo the seller but retains the
J.Ll.w, II 11111111VD 1 1)1
,, r111, ,, 11111 1g 1111 Y 1 then tf u Ume hos been ftxed for thf
II) If II " ti i: 111 ,ejc• 11 u1'1
w1111 f,i w11111,u1 v,1v1 11 g 1111 ' .. l, •JlHlli 1
u1 QYt;h tlnu:., t1nd, If no trme has been
I ,11,J!l !Jll tlilJ CK1lilJ
1cUllJJ uJ LI ~J,L>l.-' f , n1Jlt1 t l11w 0 1
( 111) II II d I t:' 1 ' 1111 ' j
11x,•rl, 1111 11"' "x" ',,
, fol th•• Hlllll' 1 WI11i.; 11 1q c.uwvolent 10 nLcept ne the l,loods.
Ill) 11,, d,11•1; !Jllllll'I 11I II!.,
Ill SI II Ii
thl'Ll!lllll1'
,, g., Il l' j>li •rfu•"
t, r,
J"atl,s ol thc L4:;c: , handed over to Mi Joshi on a sale or return
I to1 l•" wh11 1, ,, 1,c ½
M:, 1111•1•11 oW 11 "' ,, inn , ,,, 1 ihe 1110101 cai Lo Mr Ganesh. Ms Preetl now
1 1
IJ,I'· Is I\IIJtP1' ' , w1•Pk, M,· lo ht I'' r g • c I
'1.11111•, li.11 k tl11• 1110101 (;tll f, o111 M, (,;:rncs I,

Com;lu;;lou; I ,1·vc,y of 11t,• Motor c.:ar on a a1c or ,,,e•t urn

. l1>as1s
•
an d s
Mr Jw,hl. who I1:11 I 1,1 I<I'll 1 ' 1 • .
., .,,.,,, ... ,,, Mr Cane.sh h,1s ,1ttr,rrtccl the third cond1t1on that he has
p!L•d~~•u L1ll' J~UilLl..v. -- -' '
doiw -, 0 n 11 •thi11g to 1111• good, wl11< h i5 ~1ujvaient to rn11il.P~ the goods. e.g., he
pli-rlg"" 01 '>l'lh the goock 'l'hPr efor c, Lhe WJJ~lherein passes to Mr~. Now
111 tit,., ·,itu,,tioll, M~ J~i c;anuut ciaun buds. her Motor Car from Mr Ganesh, but she\

ra11 r 1;11111 tlw pnn• of the motor car from Mr.Juslu oniy. __
31. Mrs agn•c•cl to purchase J 00 b,1lr c; of cotton from V out of his large stock and send 5 t
Ith men to t,il«• dc·livery of the good'> They could pack only 60 bales. Later on, there \
w,Vi an acddl•ntal fire, dnd the entire stock was clcstroyecl, including 60 bales that \
were already packed. Referring to the pr uvision of the Sale of Goods Act, 1930,
explain as to who will bear the los'> ,1nd to what extent? (ICAI SM, !tTP May 2020) \ _ _
Ans. As per the provlslon of the sale of Goods Act, 1930, provides that unless otherwise J1
agrc•cd, the goods remain at the seller's risk until the property therein js transferred \
lo the buyer. but when the property therein is transferred to the buyer, the ~
are at buyer's cisk whether delivery has been made or not, \
Facts of the case;
Mr S agreed to purchase 100 b 1
.
hj s men to take delivery of the
a es of cotton from V out of his large stock and send 1
d Th
. . goo s. ey could pack only 60 bales. Later on, there
was an awdentaI fire, and the t' st0
were already packed. en ire ck was destroyed, including 60 bales that
Conc1u,1on;
It ls clear that Mr S has the ri ht
hll men fgr the same g g to select th e eoods out of the bulk. and he has s.ent
- . urpose. The problem b
• Mftlnptlons, and the a . can e answered based on the following
nswer will vary accordingly
8 property in the 60 b I h · 1
roprtat d a es as been transferred to the buyer, and
th
• to " contract. Thus, loss arisin& due to Ore in the r:')
REDMI NOTE 5 PRO .escholars.ln ~
Ml DUAL CAMERA
 ~
Mr s
.~...,r 60 bides '' ould be bo, ne bv~ -- -· as teKacds 40 b
rnc h, Mt \ since the goods have not been td entlfied and alu_; the loss w ou1d be
bo
th<' bales,, ere not se 1ectcd with the consent 0 f th appropriated
2) If e buyer th ·
"oods has not been transferred at all and Ile h ' en the property 1
t he " • nee t e lo..ss of 1 00 n 1
~ bcmr by Mr Ycamoletely. hales would.
M , wood\\ orth & Associates, a firm 1s dealing with the w ---:-;:;;::i'ii:::-:-:-::--4----
-ho 1esale and r t 11
elltng of\ a nous kmds of wooden logs customized e a buying 6
alll1 ~ ' • as per the require
, cu,tomer~. They dealt with Rose,,ood, Mango wood T kw ood, Burma, ment of
t I1c • ea wood \
etc. \
1•
, a customer, came to the shop and asked for wooden logs 1
Air D..1-• neasunng .
4 inches \
.
,road and 8 . feet long as required by the carpenter. Mr Das ·specifica 11 Y mentioned
\
l•
that he required the \\'.Ood which would be best suited for the purpose of making \
\\·ooden ~oors an~ wm~ow frames. T he Sho_p owner agreed and arranged the \
1

wooden pieces cut mto as per the buyers requirements. \

The carpenter visited Mr Das\ house the next day, and he found that the seller has
supplied Mango Tree wood which would be most unsuitable for the purpose. The
rnrpenter asked Mr Das to return the wooden logs as they would not meet his
requirements.
The Shop owner refused to return the wooden logs on the plea that logs were cut to
specific requirements of Mr Das and hence could not be resold.
i) Explain the duty of the buyer and seller according to the doctrine of "Cave.it
Emptor".
ii) Whether Mr Das would be able to get the money back or the right kind of wood
;.is required serving his purpose?
(May 2019, ICAI SM, May 2022 RTP)
Ans. i) As per the provision of the Sale of Goods Act, 1930, the doctrine 'Caveat 1
Emptor' means 'let the buyer beware'. When sellers display their goods in the
open market, it is for the buyers to make a proper selection or choice of the
goods. If the ~oods turn out to be defective, he cannot hold the seller liable.
The seller is in no way responsible for the bad selection of the buyer. Th e
seller is not bound to disclose the defects in the ~oods which he is sellin~.
Duty of the seller according to the doctrine of "Caveat Emptor": The ½
follO\·ving exceptions to the Caveat Emptor are the duties of the seller :
1) as to the quality or use.
Fitness
2) Goods purchased under patent or brand name,
3) Goods sold by description.
4) Goods of Merchantable Quality.
S) Sale by sample.
6) Goods by sample as well as a description.
7) Trade usaKe,
8) Seller actively conceals a defect or is iuilty of fraud,

ts dealing with the wholesale and retail buying

, customized as per the requirement of
-.--·--·- wood, Teakwood, Burma, wood

IP,USuriDI 4 inches
REDMI NOTE 5 PRO aeo.tt.oned
Ml DUAL CAMERA
m
 t ult d tor th• purpo • of
Wl)(ld whl h would
Th ll• hop ow n , 11 ar d and arr■ntad
h the
,..qul,..d th rr,m m nt I
that(\dhtn ..auoor 11nd wtndoWrt II tmY"' r1u111t ifr y, 11ul ht tounc1 that the HIier ht,
11 11 1 11
W<' lttt cut Into 11011 th 1 1111 11 11 ,hh tor the purpo,e The
r
w,md•n nt I \ I II• d Mt I) I 111 h wnul,1 h< 11111 I I they would not meet hi.,
Tht rarJlfl 1 , c Wfll"I w ' wnc)df II OR
;iuppllrd Mllllfl" ' IM II• '"'""' t 1w
lllrprntrr i,;kt'd Mt I •11 lnw, n11 rhc• Jll", th ,1 l<>R were cut to
t'Nlllll't'lllt'tlf
I
tl11 woo<'
I Ill" 1111 n Id""' lir , , nld
Tht ~hop iiwnr ,ch1'iCC ol Mt P, "'' I I t(' 11, 1· 11111
spt•flfh It ljllllC'lllt'!llt

I , I thll he ,1q11 lll'd th, wood wl11ch would be

C9nclusI) on:In spN Ifl ' llv ml•n1l1111c<
1
v illd, 11 , 1oo r ,nd w111dow fmmes, hut the lL
71
11
A-.. Mr is w~,• ot 111 rl<i f'' ' sultill>lc (c11 tlw purpose. Mr Daa
hr,t sUll(•d h1r tlH'111 Jilli:,('(' wood \Vlt11 h I', 1110 I ".'.~ 1 Wlli111illt 1.c..(jWfi:d seryln,i hla
II ,upplicd M 8° UlC I:illhlltillu lJ
sr rntltlcd
h. r, 1(1 get
the n•.U.UCY .LLa~k ur...1
f I "~,•lier to ~11pply f'J
s111 1'J.:O
rids O 111 1 c•i'lsnnnhly l1t tor the
puipos.c It Is the cluty O t ic
11 11
nM"m<'ntio,11dhythch Y • .ship t,om A11st1alia to India 3
33. l)JlI~ I s of s11g,11 n111v 1llh111110 I k. n-__
A ietrecs to sell to B I OO l.1£ ,, Cll I lc•s the ship lrns nh eac y sun uuw
•-o I s llnknown to I 1le p ' (I
within the nrxt two mont 1 • I s ti •s of Coods Ai I, l CJ30?
h I11 st J\ undl'I' tic. t --~~-,-.--
~~=~8 ha\c any rig t,ig.i . •
f the Silt• of (,001 ~ • whc,r the,c Is an ngreem•to
i s /\ c1' 19 :Jo 2
Ans. As per thefi provistOll o '•
d 111 d the goods without dllY •
f 1ult ol etthe1 Pill~ pcnsh. damaeed
!>Cit sped
or..loi.t goo s • 1s the, .eby· avo1< 1ct, 1· This· pl'ovision 1s bc1scd on • the ground of
thetcugreernent
superyenm~• 1mposs1
. L .... --
'b'hty ncrtorm,mcc which mc1kes ct contr.ict vclld.
of .,
Facu of the case; . . . .
, arriving on .i ship lrom Austrnlla to India
A agrees to se II to B loo b,igs of .sugar
withm the ne..,...t two months. The parties arc not known that the ship has sunk.
Conclusion;
In the present case, A and B has an agreement for specific goods. The goods are lost
because of the sinking of the ship before the property or risk passes to the buyer. The
loss of goods is not due to the fault of either party. So, all the conditions reQuired to 1/J
A. a void eontrarr are lulfiHed ;n the a hove case. So, B does not have any right
treat it as
against
34.
10 to sell his car to Y. They did not discuss the price of the car at all. X later
X contracted 3
refused sell his car to Yon the ground that the agreement was to avoid being
uncerta,n about price. Can y demand the car under the Sale of Goods Act, 1930?
Aas.
As per the proVision of the Sale of Goods (ICAJ SM)
buyer is an Important inpr d' f Act, 1930, the payment of the price by the Z
--- --•- e 1ent Oa contract Of 1~ If
question of Price while mak' h sa.._ the parties totally ignore the
I Ya.lid ing t e contract it w Id
n
f'f!Mft..L.L
agreement It ._.II
"
1
rat_ber he a valid• co ou not become an uncertain and
· --,...,.. Pl1ce. __ ntraa, and the buyer shall pay a

Air~ sale of !he car, but they did not fix the
•thlasround.

REDMI NOTE 5 PRO

Ml DUAL CAMERA
I !lowing tr,1ns.1rtion ,irrording to till' typl'S of J.:O(l(IS they an•: 3
1 . I lw godown. lit• agrees to sell 50 bales
Cl,1~~·il\'1111' ,.oMr of cotton h,1s I 00 h,11t>s Ill
3,. /
1) 1 \who~~· 1
, . , h,iks wt'l'l' St'lectcd ,md Sl'l ,1sidc.
'
11HI I1l(~l •
• ...; sl'II 10 H otll' p,1dwl of sug,11 0111 ol the one hundn•d packets lying In
i\,lglt'L 10 ·
Z)
htS sh1ip.
T ,,gn'L'S to sdl to S ,111 till' .1pples which will be produced in his garden this year.
3) (ICAI SM, RTP Nov. 2019, May 2022 RTP)
A who\L's,1\L'r ~otton h,1s l 00 b,tlt•s in hts g0<.lown. So, the goods are existing 1
,-\rtS,
1) goods. He ,1grccs to sell SO hales, and these b.iles were selected and set aside. On
sl.'lection, thL' goods become ascertained. In this case, the contract is for the sale

I cl ,1srertJilml L'!.rnds 11s tb1.· cotton bales tu be sold are identified and agreed
upon after the formation of the contract.
1
If A agrees to sell to 8 one packet of sugar out of the lot of one hundred packets
2)
lying in his shop it is a sale o[ existine b1.1t 1.mascertaioed eoQds because it is nQt
I ~nQwo which packet is tQ be delivered.
T agrees to sell Sall the apples which will be produced in his garden this year. It 1
3}
is a contract of sale of fut1.1n: eQQds amo1.1ntioe tQ 'an aereement tQ sell.
'""36,
IXconsults Y, a motor-car dealer for a car suitable for touring purposes to promote
I 3
the sale of his product. Y suggests 'Santro', and X accordingly buys it from Y. the car
turns out to be unfit for turning purposes. What remedy Xis having now under the
(ICAI SM)
Sale of Goods Act. 193 0?
As per the provision of the Sale of Goods Act, 1930, A stipulation in a contract of sale 1
Ans,
with reference to goods which are the subject thereof may be a condition or a
warranty, a condition is a stipulation essential to the main purpose of the contract,
the breach of which gives rise to a right to treat the rnntract as rep1.1diated.
Fam Q{th~ Cj!se:
X consults Y, a motor-car dealer for a car suitable for touring purposes to promote 1
the sale of his product. Y s1.1eeests 'Santrn', and X accordingly buys it from Y. the car
turns out tQ be 1.1nfit for turning purposes.

CQnclusiQn:
In this case, the term that the car should be suitable for touring purposes is a
condition of the contract. It is so vital that its non-fulfilment defeats the very purpose 1
I for which X purchases the car. X is therefore entitled to reject the car and have a

37. Irernru1 of the price.

Mrs G bought a tweed coat from P. When she used the coat, she got rashes on her 3
skin as her skin was abnormally sensitive. But she did not make this fact known to
the seller, i.e., P. Mrs G filled a case against the seller to recover damages. Can sh e
I recover damages under the Sale of Goods Act, 1930?
~ (Dec. 2021, ICAI SM, RTP May 2021)
 -------- __,,,
G ds Act, 1 l there ts ~
9 3 0, A contract of. sale, n"

. ·on of the Sale of ,oo . fitness

ali~ or ---- for any part1cu ar
. ,, I hpurpose of
----r~A:-:s-:p:-;:c-;:-rttll,,cc pro,v1s1 . w,11-ranl)' as to qtL !~"Caveat Emptor", that is ' et t e buyer
Ans. . 11lhrd cOlldiHOU Pl •r ti nih' is that o . li cdly makes known to the seller the
w. i Th~ grill ' . ·I)' or 11np . h
8l[)ods. supplicl I· "n' till' 1HIV'l'I t•:xprl'ssi . ·trc n•qull. ·cd '·ind also re 11es on h t e seller's
ht•W,tn'N· But w H . I irh till' gooc s ' . . f the seller to c;ell sue goods in the
111 1ist' tor '" , I business o
p.irtintl,tr P 'P • th.ti this is t • kc the seller responsible.
"k11l ,rnd 1ud~t•nwnt
· .
,ull .; . , . :. :
1 tl' •
the h11yt•r can n1,1
. , QfJu:, bu:iWl,o.>U<•
•

QLiliilllil'
1tl1..lllll~
'r1tSC.: . , i the coat, she got rashes on her
Wht'll she uscc
oat:,
1:i1ctsch 1ught , , 1(l),11 tnin1 P.
,1 t\\l l I
· ..
, •Hive But ,lW.
1,,, did not make this fact known .t.Q
Mr~ • i ' . ,kill \\'.ts ,1hnorrn,1lly sens . . . he seller to recover damages.
!-hlll .,~ h1 i . ~ ~II ' i il cast' aga111st t
· , I' ~tr:,; li fl t:l •
lh~.cikl ll • •

tunruwon;
. • d t without • r; rming
m10 the seller, 1.e., P, .about the
1
Mrs pl ir ·h •ised
t,-
1
· the twee
. refore she cann at make the seller responsible on the
Th coa
11
' . bl e for her skin, Mrs G cannot treat it as.a
skm. e not su1ta
. t I\•l , ,itlll'L' ofhe1
sen~1
,rouiHI th.it the tweed coat was d nuaJiru and has no right to recover
gbmJCb Qf @phed d · as to fitness an_ " i - - !,J.
. cmut100

S t rom the .sell er::_

nag L'~ by sample by o 8, . d~s~b~yr144
~w:ihh.o~in~tu;:;r;;n~s~olkdltlth;e½sa;m~e~g~o;o;
Jd. ---:--;:----;A-:t:=t
38. 'tam goods \\ere so
0
the goods
d to D were not accordmg to the
samplt' to Cand C by sample sold ~e; ~ ~on ~ the goods from the sample, rejected 1
nd 0
sample. Therefore, D, who fou t e evta d d A Advice B and C the Sale of
d ti e to C C sued 8 an 8 sue ·
the goods an gave no c · (ICAI SM, May 2022 RTP)
Goods Act. 1930? l ·
II- ~\ns. As per the prov1s1on of th e sale of Goods Act, 1930, Where a contract of sa e 1s not
----:---
1½
severable, and the buyer has accepted the goods or part thereof, the breach of any
condjtjon to be fulfilled by the seller can only be treated as a breach of warranty and
not as a ground for rejecting the goods and treating the contract as repudiated
Facts of the case:
Certam goods were sold by sample by A to 8, who sold the same goods by sample to
Cand C by sample sold the goods to D. the goods were not according to the sample.
1
Tlierefore, D, who found the deviation of the goods from the sample, rejected the
goods and gave notice to C. C sued 8, and 8 sued A.
Conctusion;
D Wh_o noticed the deviation of goods from the sample could reject the goods and
treat" as a breach o(implies condition as to sample which provides that goods are
bsold_by sample the goods must comsoond to fthe sam pie in q 113 lii!J1. The buyer should
e given reasonable time and on rtu •
O
W ereas Ch ,,,
can recover p
only o frmty 8 comparin~ the bulk with the sample.
damages 1½
C and B, it will not b tr d om a nd B can recover damage from A. For
e _eate_ as a breach of · 1· d · ·
39. have accepted and sold th e goo ds according imp 1e cond1t10n as to sample as they
A person purchased bread from a baker's sh. .
in It which broke the buye rs, t0 h . op. The piece of bread contained a stone
b . ot while e t' w 3
I
As per the Provision of the S I ~th~S~I
AAns.~l~uy:e~r~a~ga:tn~s~t~th~e~s~e~II~er~u~n~d~e~r
Wbafesameo•
whnfeso"'& :t .~ 1th a e
e a ei~aCi
of
of Goods
Goods Act 1930 1 1
Act, 19ar~e~t~h~e~r~ig:h;t:s~a~v~a~i!Ja!b~le~t!_o~th~ei--:
n~g~•;h~a~t~
3 0?
.
Provtdes that th~ eata~~ ated to implied condition as to
(I CAI SM)
1

.., It--.....,.. es and Dtoyisjons must be

...... er"'••
AJ>erlon
In ft

d contained a stone 1

G
 - - -

~t bre,1d Cllntamcd ,l stone that hroke the bu-y--.-------,___ _

,.ht' p1,'l er s tooth while e t' 1
, onsidered unfit for consumption. a mg,
1t •rt'l1) r . .
1 l tht' bu,·er can treat 1t as J breach of mmhed condition as t 0 w h O1esomeness
t-1enCi.', • .
d iJUI 11 .;n c1. 31 m d.mrnr:es trom the seller.
Fiat car, .wants to sell his car. For this purpose · he hands overth e car 5 -
~ I thr o .
~l. : p ,l niercanttle agent tor sale at a pr~ce not le~s than ~50,000. The agent sells the
11
cJr for N0.000 to A. who buys the car m good fatth and without notice of any fraud.
p nusappropn:ited the money also I sues A to recover the car. Decide giving reasons
l
whether I would succeed
(ICAI SM, RTP Nov. 2020, RTP Nov. 2019)
' As per the provision of the Sale of Goods Act, 1930, provides that a mercantile agent 1
- ..\JlS, is one who m the customary course of his business, has, as such agent, authority
l
either to sell goods or to consign goods for the purpose of sale, or to buy goods, or
to raise money on the security of goods. The buyer of i:oods from a mercantile aeent.
who has no authority from the principal to sell, gets a i:ood title of the i:oods of the
following condjtjons are satisfied:
1) The agent should be m possession of the goods or documents ohitle to the goods ½

mtb the ronsent of the owner.

2) The agent should sell the goods ,.,.hile acting in the ordinary course of business ½

of 3 mercantile agent
½
3) The buyer should act in good faith.
4) The buyer should not have at the time of the contract of sale notice that t h e ~ ½

has no authontv to sell.

Facts of the case:
), the owner of a F~at car, wants to sell his car For this purpose, he hands over the car
to P a mercantile agent for sale at a price not Jess than =tSO 000. The ai:ent sells the
1
car for HO 000 to A, who buys the car in good faith and without notice of any fraud.
P :-11isappropriated the money also. ] sues A to recover the car.
Conclusion:
P the agent, was in possession of the canvith j's c.onsent for the purpose of sale. The
1
buyer, therefore. obtained a good tide to the car. Hence,), in this case, cannot recover
t.l-ie car from A.
6
41 Distinguish between Sale' and 'Hire Purchase' under the Sale of Goods Act, 1930.
(Dec 2021)

G
 Ii ire-Pun: hase
5ale
Ans.
eastso ( difference

Time 0f passing
the propertY

position of the
party
~ nn t m \ hk
Of The buy r t t t rmtn t th nu t by
Termination the n
contract termm t th L--c1W:n1ru!. Lhc.. .t1lilib t Its
rnd ts bQvod to p,il'.
O\\ n 1 ~ 1th ut m~ 11 hlhty to
prt e of th goods
p } th rrnia1n1ni; mst,Jlmcn~

Th o" n r t 1kc,; no such ask,

Burden of rhk of The s II rt ike!i the ru.K of
insolvency of the .my loss resulting from the
1asolveocy of the buyer
buyer
Transfer oftitJe The buyer cJn pa:;s t7 cood
tiili: to a bon,i Ode
purchaser from him
Resale The buyer m the sale can
resell the ~oods
for H th hu r f 111 to pay an
ln,;t Im nt th owner has the
nebt to ukc back the eood,s
Th hire, cannot 11.1s:, any Utlc
evt:n to 1 hon fide purcha r
The h1rt: purchaser ~
ru.ell unless he hns paid all the
Instalments.

42
Archika went to a Jewellery shop ,md c1sked the shopkeeper to show the gold bnngles
4
with \\hlte polish. The shopkeeper informed that he has gold bangles with lots of
designs but not in white polish rather If Arch1ka select gold bangles in 111s shop, he
/ will arrange white polish on those gold bangles without any extra cost. Archlkn select
a set of designer bangles and pay forthaL The shopkeeper reg uested Arch ika to come
I two days for delivery of those bangles so that white polish can be dune on those
after
bangles. When Archika comes after two days to take deltvery of bangles, she noticed
I that due to white polishing. the design of bangles has been disturbed. Now, she w<1nt.s
to avoid the contract and asked the shopkeeper to give her money back but
shopkeeper has denied for the same.
1
st th
a)G oods ate wi reasons whether Archika can recover the amount under the Sale of
Act, 1930.
I b) What would be your answer if sh
Ans. opkeeper says that he can repair those bangles •
but he will ch ar e extra cost for same?
As per Section 4(3) of the Sale of G d A· (Nov 2021 RTP) t •

i~
1
· . a ~o s ct, 930, where under a contract of sale, the I •
...i.,I but where the transfer of the p
( •'lllll;" . · the contract is called i
.. roperty in the goods is to take place•at a ~ ◄
agreement to·e seJl d e r th

;t;:,:~:
I
. an as per Section 4 e contract 1s called an
t~:,ses or the conditions are( ~iii7e~g:~~ment to sell becomes a sale when • ,
◄
fa
~«~e~ transferred.
Archtka went to a je ll
Ject to which the property in the

With White poJJsb. we ery shop and asked the sho • •

d but !!Ot la The ed that ~:•:P•r to show the gold bangles • ~
as gold bangles with lots of t
old ban les in his sho he
 . l, ,,
r_.'I .
•r If
..I ;-;.,

• ,,·hiti' polish 011 those gold b ingl

rr:irt).:l I i • cs Without
, 11 ;1 ,,igni•r b,lllg rs ,1m 1i.1v for th.it. Tlw sit 1 .iny cx1ru uisi A
1 111 < ~- I l op <t>c1w 1 1 1 l\11\
11
sl' 1 d ys for d1' 1vcry ol t tc1s1: b,rnglcs s 11 th cq11l'st.-t1 A11 1 ''' 1,.,\.,11
'1 l•tWO'1 ·· ,llwhth• I ·1tk11
~lll'1 • When Arduk,1 cunwc; utter tvvo d ' iyq t .
0 •' 1ll' dl'hv, po tsh cc1n bed ' n ronw
<'ll'~· . one un 11
1,,111r,
t dlll' to whitl' pohsh1ng, ,
the de:;1g11
k of h ,1w!Ps I l cry
• "' . 1,1s Wl'll dist I of h,111~\cs sl
' IC no11n•tlinw
11,1
I JVOI ·cl the contrJct
,
,1m,
. , 1· I ,Is l'd the shnpkl'l'lll'r l ur
o 1,11vc h 1. icd. Now :;\w
' 1 W,tn\s
1
to • ,,er hJS c,cn1L'O or t 1e s,lllll'. c money b . 1
~111111kt'l' • . • l l 1Ul

~ - b a s i s of above provisions :ind l,,cts given 111 the ,

shopkcc11it •<.:,m
' there is an ,1grccmcnt to sell bet w1~en Archik a ,111 dq1.1cstton,
J) th·1t . br s.11tl1
ale Even the payment
I 1· was
I . made by An:hik, th .
'' e p1 opl'rty Ill uo d. ci 0 ,1nt1 not ,
s . 1
trJnsferred on y .a tcr t1· 1cI fulfilment of conditions. flixc•d 1>ctwcc11 ,., h s <.:,111 be
seller. As the while po 1s .1 was. .done but . origitnl ' de. . . ct·
sign IS 1sturhcc.l d , uycr .ind
olish111g, bang1es are not m ongmal posit ton Hence ' A.I c1H'ka h as · nght . . to
t 0 uc .
P
the agreement to sell and can recover the pnce paid. ,,vmtl
on the other· hand, tf shopkeeper
I. . . offers to· bring the. bangles
' in 01.·lgm,1 • 1 position
b) by repa1nng, he ca_nnot c 1.1rge extra co~l from Arch1ka. Even he has to bear some 1
ex enscs for re air; l~nnot char_g~1.!J.!_·om Archika
Rachit ~rranges_an auction to sal: an antic wall d~<.:k. _M_c-•g~h~a-, b·-e-i-ng- 0 -11 e- of the bidders, 3
43 gives highest bid. For ,mnouncmg the completion of sale, the auctioneer falls the
hammer on table but suddenly hammer brakes and damages the watch. Megha wants
to avoid the contract. Can she do so under the provisions of the Sale of Goods Act,
1930? _ _ _ __ _ _ _ lNov2021 RTP
1
By virtue of provisions of Section 64 of the Sale of Goods Act, 1930, in case of auction
Ans, sale, the sale js complete when the auctioneer announces its comp1cti..o.l1Jly_thc of ran
.the hammer or in some other customary manner.
facts of the case: 1
In the instant case, Megha gives the highest bid in the auction for the sale of antic wall
clock arranged by Rach it. While announcing the completion of sale by fall of hammer
on the table, hammer brakes and damages the clock.
Conclusion:
On the basis of above provisions, it can be concluded that the sale by auction cannot 1
be completed until hammer comes in its normal position after falling on table. llence,
in the given problem, sale is not completed. Megha will not be liable for loss and can
Jvoid the contract. 3
X contracted to sell his car to Y. They did not di;c~th;-price of the car al all. X later
44 refused to sell his car to Yon the ground that the agreement was void being uncertain
about price. Can Y demand the car under the Sale of Goods Act, 1930?Nov2021 RTP
1
As per the provisions of the Sale of Goods Act, 1930, the payment of the price by the
Ans.
buyer is an important ingredient of a contract of sale. If the parties totally ienore the.
question of price while making the contract, it would not become an uncertain and
invalid agreement. It will rather be a valid contract and the buyer shall pay a
reasonable price. ~
0:: <(
•, .,

Facts of the case: 1 Cl o::

X contracted to sell his car to Y. They did not discuss the price of the car at all. X later
refused to sell his car to Yon the ground that the agreement was void being uncertain l!r.l UJ
about price.
L
l!lLI
~ <(
Conclusion: 1 ~ u
In th e give case, X and Y have entered into a contract for sale of car but they did not 0
~ _J
fix th e price of the car. X refused to sell the car to Y on this ground. Y can legally _ _ <(
demand the car from X and X can recover a reasonable price of the ~ar fr!?n.1 Y_._:·:..---1----i
4 :E ::,
45 A went to B's shop and selected some jewellery. He falsely ~e~ented himself to be C) C)
a man of credit and thereby persuaded B to take the payment by cheque. He further UJ -
re~ueS t ed him to hand over the particular type of ring immediately. On the due date, ~L
w en the seller, B resented the ch ue for

G
ent, the che ue was found to be