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SALES OF GOOD ACT

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Introduction

THE SALE OF GOODS ACT,1930 Goods :- Goods mean any kind of movable property other than money & actionable claim & includes :- * stocks & shares * growing crops * grass * things attached to OR forming part of land but which can be severed {separated} at the time of the contract. Types of goods :- 1) Existing goods : They are those which exists in the possession OR custody of the seller at the time of the contract of sale. They are further divided into :- a) Ascertained goods - They are those, which can be identified at the time of the contract. e.g. :- Purchase of TV, Refrigerator, etc.. b) Unascertained goods - They are those, which cannot be identified at the time of the contract. e.g. :- A buyer wants to purchase 5 kgs of sugar out of a bag containing 100 kgs of it. 2) Future goods : They are those, which are not in the possession of the seller in the condition in which they should be sold. These goods are to be produced OR manufactured OR acquired by the seller after the contract of sale. e.g. :- A buyer desires to purchase furniture of a particular description to be made by a carpenter. Contract of sale :- A contract of sale of goods is a contract where by the seller transfers OR agrees to transfer the property in the goods to the buyer for a price. Such a sale may be absolute OR conditional. Where under a contract of sale the property in the goods is transferred from the seller to the buyer the contract is termed as sale. Where the transfer of property in the goods is to take place at a future date OR after certain conditions are fulfilled the contract is termed as an agreement to sale. An agreement to sale becomes a sale after the expiry of the time agreed upon OR after the condition is fulfilled. ...read more.

Middle

But he must acquire the same before the agreement to sell becomes a sale. Implied warranty as to possession :- In every contract of sale there is an implied warranty that the buyer will not be disturbed of his possession of the goods by any 3rd party. If the possession of the buyer is disturbed the buyer may claim damages from the seller. Implied warranty as to encumbrance :- In every contract of sale there is an implied warranty that the goods are free from any change OR 3rd party interest {encumbrance}. If the buyer suffers any loss due to such charge he can claim damages from the seller. Implied conditions in specific contracts :- * Sale by sample - When the seller gives a sample to the buyer of the goods to be sold & the buyer after approving the sample enters into a contract of sale the sale is said to be a sale by sample. In such a sale there is an implied condition that the goods must correspond to the sample. * Sale by description - Where the seller & the buyer agree upon a description of the goods to be sold, the sale is said to be a sale by description. In such a sale there is an implied condition that the goods must correspond to the description. * Sale by sample & description - Where the sale is by way of sample & description there is an implied condition that the goods must correspond both with the sample as well as the description. Implied condition as to quality & fitness [Caveat Emptor] :- As a rule when the buyer purchases goods he does so at his own risk. Therefore the buyer must apply his skill & judgment while purchasing goods. If the goods are found to be of an inferior quality the buyer does not have a right to return the goods. ...read more.

Conclusion

if the goods are destroyed OR damaged in transit the seller would have to bear the loss. C.I.F. contracts :- C.I.F. contracts mean Cost Insurance & Freight contracts. In a C.I.F. contract the seller must execute an invoice mentioning the value of the goods. The seller must load the goods & mention the buyers name on the bill of lading as the consignee. The seller must insure the goods & pay the freight on behalf of the buyer. When the buyer receives the goods he pays according to the bill of lading. In this case the liability of the seller continues till the goods are delivered to the buyer. If the seller fails to insure the goods he will be liable for any loss OR damage of the goods in transit. Even if the goods reach safely & are not insured by the seller the buyer can claim damages from the seller. Auction sale :- Rules governing an auction sale are as follows :- 1) The sale is complete when the auctioneer announces its completion by the fall of the hammer OR in any other customery manner. 2) A bidder is at the liberty to withdraw his bid before it is accepted. 3) The auctioneer is not bound to sale the articles to the highest bidder except in case of a sale by reserve. 4) The auctioneer is bound to hold the auction on the date for which it has been advertised. As the advertisement is not an offer but an invitation for offer. 5) A condition in an auction sale is valid. 6) A condition that the bidding once made cannot be withdrawn is unenforceable. 7) A right to bid may be reserved by the seller. 8) An agreement not to bid against each other is called as knock out agreement. These are not unlawful. 9) The sale may be notified that there may be a price below which the goods will not be sold. 10) If the sale is through the court it would be subject to the confirmation of the court. - RAHUL PARAB ...read more.

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