Sale of Goods Act, 1930

Submitted to: Dr. Sundeep Kumar

Submitted by: Disha Jain
Sale of Goods Act 1930
• Earlier regulations related to sales of goods in India were covered
under Chapter VII of the Indian Contract Act 1872.

• Later a new act called the Sale of Goods Act 1930 was passed.

• The Sale of Goods Act of 1930 deals with the laws related to all sale
agreements in the country.

• Based on the English Sale of Goods Act 1893.

Contract of Sales
• According to the act, “Contract of sale is a contract whereby the seller
transfers or agrees to transfer the property in goods to a buyer for a
price.”
• The contract contains:
1. Sale or absolute sale where the ownership of goods is immediately
transferred from the seller to the buyer;
2. Agreement to sale or conditional sale where the ownership in the
goods shall take place at some future date or on the fulfillment of
certain conditions.
Essentials of a contract of sale
• A contract of sale is just like any other contract in the Indian Contract Act
1872.
• It should satisfy all the essentials of a valid contract. These essentials are:
1. Valid offer
2. Valid acceptance
3. Free consent of the parties
4. Valid and lawful consideration
5. Parties must be competent to the contract
6. Lawful object
Two Parties
• Buyer and seller must be two different persons.

• A man cannot purchase his goods.

• For example, the members of a club are its undivided joint owners.
Hence, when the club provides them with food and drinks at a fixed
price, this is not to be considered a sale.
Exceptions to the rule of two parties
1. Where a person’s goods are sold in execution of decree (or order by
law);
2. A part owner can sell his share to another part owner to make the
other part owner the sole owner of the goods.
3. Where the pawnee sells the goods pledged with him on non-payment
of bill money, the pawnor may himself buy such goods.
4. A partner may also buy goods from the firm in which he/she is a
partner.
5. In case of sale by auction, the seller can preserve his right to BID at the
auction and may thus purchase his own goods.
Agreement for transfer of ownership
• Immediate transfer or agreement of transfer.

• Ownership and possession are different.

• Essential to transfer ownership with or without physical possession of

goods.
Goods
• Subject matter of the contract of sales must be goods.
• According to section 2(7), “Goods mean any kind of moveable
property other than Actionable claims and money.”
• Goods include stock and shares; growing crops; grass; trees; and
things that are attached to the land and would have to be severed
before sale or under contract of sale.
For example, where trees are sold so that are to be cut out and
separated from land to be taken away by the buyer. The contract is to
sell the tree as a moveable good.
Money, actionable claims, and immovable
property
• These are excluded from the definition of “Goods”.
• Price of goods has to be expressed in terms of money. Hence, money
itself cannot be the subject of sale.
• Actionable claims such as promissory notes or bills of exchange are
debt instruments enforced by law. These are also not considered as
goods.
• Sale of immovable property is covered under a separate act of Transfer
of Property Act 1882.
Price
• For a valid contract, consideration for transfer must be paid or
promised to be paid in the future.

• Where there is no money consideration, the transaction is not a

contract for sale.
Thank You