The Sale of Goods Act, 1930

THE SALE OF GOODS ACT,
1930
Originally, the law relating to sale of goods was contained in
Chapter VII of the Indian Contract Act, 1872.
The same was repealed and re-enacted by the Sale of Goods
Act, III of 1930.
The Act came into force on Ist July, 1930.
The Indian Sale of Goods Act closely follows the English Sale
of Goods Act, 1893.
 Section 4 of the Act defines ‘SALE’ as follows-
 A contract of sale of goods is a contract whereby the

seller transfers or agrees to transfer the property in
goods to the buyer for price.
CLASSIFICATION OF
PROPTERTY.
MOVABLE AND IMMOVABLE PROPERTY
Sale of Goods Act deals with Moveable

Property whereas Transfer of Property Act deals
with Immoveable Property.
ESSENTIALS OF A CONTRACT
OF SALE
1. There must be at least two parties.
 A seller and buyer. A seller and buyer must be
different persons. A person cannot buy his own goods.
 Graff v Evans
 Bell v Lever Bros. Ltd.
X is the owner of certain goods, but he does not
know. Y pretends to be the owner of the goods and
sells them to X. There is no sale, for X cannot buy
goods which are already his own.
2. Transfer or agreement to transfer the ownership of goods.
 In contract of sale, it is the ownership that is transferred as
against mere possession or limited interest.
 Ownership is said to exist when –
1. The right is available against the whole world
2. Over a determinate thing
3. Indefinite in point of user
4. Unrestricted in point of disposition
5. Unlimited in point of duration.
3. The subject matter of the contract must necessarily be
‘goods’.
 S2(7) -The term goods means every kind of moveable
property other than actionable claim 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.
CLASSIFICATION OF GOODS.
1. EXISTING GOODS – are those which are owned and

or possessed by the seller at the time of the contract.
1. FUTURE GOODS – means goods to be manufactured

or produced or acquired by the seller after making
the contract of sale.
1. CONTINGENT GOODS – are the goods the

acquisition of which by the seller depends upon a
contingency which may or may not happen.
Contingent goods is a part of future goods.
4. The consideration is PRICE.
 Consideration in a contract of sale has
necessarily to be ‘money’.
 Price is an integral part of a contract of a sale.
 Aldridge v Johnson
A contract of sale may be absolute or
conditional.
All other essentials of a valid contract

must be present.
Being a specie of contract, sale must
conform to all other essentials of a
valid contract.
Sale and ‘Agreement to Sell’
 In sale the goods is transferred from seller to buyer.

 Sale makes buyer owner of goods.
 Risk of loss passes in sale.
 In sale if buyer commits default ,seller may sue for
price or specific performance of contract. Whereas
in agreement to sell sellers remedy is to sue for
damages for breach.
The section 4(3) of the sale of Goods Act defines it as,
“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 an agreement to sell.”
When agreement to sell becomes sale [sec4(4)]-

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.
Agreement to sell & Hire Purchase
Helby v Matthews
After paying certain installments Brewster pledged it
with Mathews,who acted in good faith.
Helby sued Matthews to recover the instrument.
It was held that he could do so.
 Offer & Acceptance
 Immediate delivery of goods or
immediate payment of price or both.
 Delivery or payment by installment.
 Contract may be in writing or by words
of mouth.
Effect of destruction of Goods before making of the
Contract – Void [section 7]
Where sale is of specific goods

Goods have perished before contract is made and
without the knowledge of the seller.
Barrow lane & Ballard v Phillips

Goods perishing after agreement to sell
[ section 8]
It will be void if goods have perished or

damaged without the fault of seller or
buyer.
Howell v Coupland
 Agreement to sell at Valuation [S.10]
 - valuation by third party

 - Third party fails to make valuation
 - Contract will be void.

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THE SALE OF GOODS ACT,

 A contract of sale of goods is a contract whereby the

Sale of Goods Act deals with Moveable

1. EXISTING GOODS – are those which are owned and

1. FUTURE GOODS – means goods to be manufactured

1. CONTINGENT GOODS – are the goods the

All other essentials of a valid contract

 In sale the goods is transferred from seller to buyer.

When agreement to sell becomes sale [sec4(4)]-

Where sale is of specific goods

Barrow lane & Ballard v Phillips

It will be void if goods have perished or

 - valuation by third party

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