THE

SALE OF GOODS ACT,

1930
•
This act may be called the Sale
of Goods Act, 1930

It has come into force on the

first day of July, 1930.

It extends to the whole of

Bangladesh.
Definitions:
Goods: Goods means every kind of movable
property other than actionable claims and
money and includes stock and shares, growing
crops, grass, and things attached to or forming
part of the land which are agreed to be severed
before sale or under the contract of sale.
Specific Goods: It means goods identified and
agreed upon at the time a contract of sale is
made. (clause:2-4)
Future Goods: It means goods to be manufac-
tured or produced or acquired by the seller
after making the contract of sale. (clause:2-6).
Buyer: A person who buys or agrees to buy
goods. (clause:2-1)
Seller: A person who sells or agrees to sell
goods. (clause:2-13)
Price: The money consideration for a sale of
goods. (clause:2-10).
Delivery: Voluntary transfer of possession
from one person to another.
Deliverable State: Goods are said to be in a
“deliverable state” when they are in such state
that the buyer would under the contract be
bound to take delivery of them.
 What is a Sale?
A Sale is the act of selling a product or
services in return for money or other
compensation..

Why the Sale of Goods Act Important?

-- to avoid the problems many consumer

faces when they make purchases.
-- to know the right of buyers and sellers.
-- to know the responsibilities of buyers and
sellers.
What is Contract of Sale?
A contract whereby the seller transfers or agrees
to transfer the property in goods to the buyer for
a price. A contract of sale may be absolute (The
way it is) or conditional.
Example: Karim has a horse. Karim hands
over the horse to Rahim for the amount of
Tk.20,000 or Karim agrees to hand over the
horse to Rahim within three(3) days. For
both party this is an example of Contract for
sale of goods.
Caveat Emptor
[Latin, Let the buyer beware.]:A warning that
notifies a buyer that the goods he or she is
buying are "as is," or subject to all defects.

When a sale is subject to this warning, the

purchaser assumes the risk that the product
might be either defective or unsuitable to his or
her needs.

It merely summarizes the concept that a

purchaser must examine, judge, and test a
product considered for purchase by himself or
herself.


Example (Caveat Emptor):-

Karim went to market and purchased a bike
to take a part in Bike race competition. But
he did not tell the seller that for which
purpose he is buying.
When he reached home, he came to know
that this bike is not suitable for bike race
competition.
Due to the principal of Caveat Emptor
Mr. Karim can neither reject the bike nor
can claim for compensation.
Sale and Agreement of Sale: Where
under a contract of sale, the property in the
goods is transferred from the seller to the
buyer, the contract is called a sale, but where
the transfer of the property in the goods is to
take place at a future time or subject to some
condition thereafter to be fulfilled, the
contract is called in agreement to sell.
An agreement to sell becomes a sale when
the time elapses or the conditions are
fulfilled subject to which the property in the
goods is to be transferred.
Example:
Karim sells 50 kg of rice to Rahim for an
amount. Or
Karim accepts money from Rahim and
promises that Karim will send Rahim 50 kg
of rice within three (3) days.

Those two examples are the example of Sale

(Executed Contract) and Agreement of Sale
(Executory Contract).
Offer and Acceptance:
A contract of sale is made by an offer to buy
or sell goods for a price and the acceptance
of such offer. The contract may provide for
the immediate delivery of the goods or
immediate payment of the price or both, or
for the delivery or payment by installments,
or that the delivery or payment or both shall
be postponed.
•

Method of Contract: Subject to the

provisions of any law for the time being in
force a contract of sale may be made in-
--by word of mouth, or
--partly in writing and party by word of
mouth or
--may be implied from the conduct of the
parties.
Existing and future goods:
(1) Goods present at the time of transaction
with the seller
(2) Goods to be manufactured or produced
by the seller after the making of the contract
of sale.
Goods perishing before making of
contract: Where there is a contract for the
sale of specific goods, the contract is void
(cancelled) if the goods without the
knowledge of the seller have, at the time
when the contract was made, perished or
become so damaged as no longer to answer
to their description in the contract.
Example: Karim wants to import 100 tons
of onions from Rahim. Those Onions was
supposed to come to Bangladesh by a Ship
from India. Rahim is the Onion merchant
here.  Both parties (Rahim and Karim)
make a contract of sale of those Onions. 
But when Rahim (the seller) goes to his
warehouse to get those onions to put them in
a ship, finds that all the onions got rotten in
the warehouse without his knowledge and
which was unknown to Rahim. In this case
that contract will be void (cancelled).
Ascertainment (deciding the price) of
Price
-by joint agreement or by the course
of dealings.
-by reasonability
-by third parties.
Ascertainment (deciding the price) of
Price: Price ascertained by joint agreement
or by the course of dealings: The price in a
contract of sale may be fixed by the contract
or may be left to be fixed in manner thereby
agreed or may be determined by the course
of dealing between the parties.
Example: Rahim purchases two tons of
wheat from Karim in the month of May. But
it was decided by them that the price of
those wheat will be decided by them on the
1st of July according to the market value as
of July 1st.
Ascertainment of Reasonable Price:
Where the price is not determined in
accordance (according to) with the foregoing
(previous) provision (condition), the buyer
shall pay the seller a reasonable price. 
What is a reasonable price is a question of
fact dependent on the circumstances of each
particular case.
Example: Rahim delivered two tons of
wheat from Karim on May 1st. But when
Karim purchased that wheat from Rahim the
price of those wheat was not fixed. In this
case the price of that wheat will be fixed as
the market price of wheat as of May 1st.

Where the third party cannot or does not

make such valuation, the agreement is
thereby avoided:
What is Condition?:
A condition is a stipulation/conditions
essential to the main purpose of the
contract the breach (break) of which gives
to right to treat the contract as repudiated
(Reject). Clause: 12-2
What is Condition?:
Example: Imam wants to buy some
furniture. He goes to a furniture shop and
says to the furniture shop owner that Imam
will only purchase furniture’s from the
furniture shop only if the seller provides
Furniture’s to Imam made of Segun Wood.
 In this case the “ Segun Wood” is the
Condition (main requirements) in case of
purchasing furniture from the seller.
What is warranty? According to Sale of
Goods Act, 1930, a warranty is a stipulation
collateral to the main purpose of the
contract, the breach of which (collateral)
gives rise to claim for damages but not to a
right to reject the goods and treat the
contract as repudiated. Clause: 12-3
Example:
(1) Raisa wants to buy some furniture. She goes
to a furniture shop and says to the furniture
shop owner that Raisa will only purchase
furniture’s from the shop only if the seller
provides Raisa Furniture’s made of “Good
Wood”. The seller assures Raisa that she will
receive furniture from the seller made of Segun
Wood. And an agreement was made between
them. But on the time of delivery of the
furniture’s Raisa finds out that the furniture’s
were not made of Segun wood they were made
of Korai tree wood.
Example:
(2) In this case Raisa must accept the fact that
the seller has broken the secondary conditions
not the primary conditions of the sell.  In this
case Raisa may claim for damages but cannot
reject the goods and can not treat the contract as
repudiated (reject) Because Raisa did not
mention specifically in the contract that the
seller must provide Segun Wood furniture
otherwise the contract will be void.
When condition to be treated as
warranty? :Voluntary Waiver
(1) where a contract of sale is subject to any
condition to be fulfilled by the seller, the
buyer may waive the condition or elect to
treat the breach of the condition as a breach
of warranty and not as a ground for treating
the contract as repudiated. Clause: 13-1
When condition to be treated as
warranty? :
Example: An agreement of sale is made
between a buyer and seller that certain
product will be delivered by the seller to the
buyer by May 1st . And this date May 1st
was fixed by the seller, but in reality the
product was delivered to the buyer on May
2nd.  Here the buyer instead of cancelling
the contract make a claim against the seller
for any damage done to the buyer for not
delivering him the product on time.
When condition to be treated as
warranty? : Compulsory Waiver:
Where a contract of sale is not severable
(unbreakable by the buyer). If a buyer has
accepted goods or part of goods thereof the
breach of any condition that supposed 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, unless there is a term of the
contract, express or implied, to that effect.
Clause: 13-2
Compulsory Waiver: Example: Karim
makes an agreement with a car garage that the car
garage will provide Karim a complete “Motor
Engine” to run his car. The car garage provides
Karim half of the motor engine and keeps on
delaying to provide the other half of the engine to
Karim.  Since half of the motor engine was
provided to Karim and Karim also accepted that
half of the engine but the car garage by delaying
the delivery of the other part of the engine
actually breached the conditions  But since
Karim has accepted the half of the engine he
cannot reject the contract with the garage Karim
can only claim for monetary damage for the delay
delivery.
Condition as to title: There is an implied
condition on the part of the seller that, in the case
of sale, he has a right to sell the goods and that, in
the case of an agreement to sell, he will have a
right to sell the goods at the time when the
property is to pass. Clause: 14-A On the other
hand it is said that: If someone sales anything by
not being the owner of those things in such case
the buyer can reject the contract. Example: Karim
purchases a car from Rahim and use the car for
eight months. Later Karim finds out that Rahim
is not the original owner of the car, Jamal is.  In
that case Jamal will get the car back from Karim
and Rahim will give the full amount money taken
from Karim to Karim.
Sale by description: Where there is a
contract for the sale of goods by description
there is an implied condition that the goods
shall correspond with the description.
Clause: 15
Example :- Mr. Rahim sells butter to Mr.
Karim saying that it is a pure butter and
there is nothing mixing in it. When Mr.
Karim uses it, he comes to know that there is
adulteration in it. Now Mr. Rahim will be
held responsible.
Sale by sample: When a sale is done by
sample, (a) The bulk shall correspond with
the sample in quality; that is the product
must match as described earlier. (b) that the
buyer must be given enough time to match
the product with the sample. (c) that the
goods shall be free from any defect,
rendering them un merchantable, which
would not be apparent on reasonable
examination of the sample.
That is the product must be supplied as the
sample. No fault can be there. Clause: 17.
THANK
YOU