FORMATION OF CONTRACT OF SALE
• Till 1930,the law relating to sale and purchase of goods were regulated by the
Indian contract act ,1872. In 1930, sections 76 to 123 of the Indian contract act,
1872 were repealed and separate act called ‘The Indian sale of goods act, 1930
was passed. It came into force on 1st July 1930.
ESSENTIALS OF A CONTRACT OF SALE
1)Two parties Buyer and Seller
2)Goods
3)Transfer of property
4)All Essential elements of a valid contract must be fulfilled
5)Price
6)Include both sale and agreement to sell
GOODS
Defintion-Sec2[7]The subject matter of a contract of a sale must be goods. The term ‘goods’ means
‘every kind of movable property other than actionable claims and money and includes stock and
shares, growing crops, and things attached to or forming part of the land which are agreed to be
served or under the contract of sale’.
, Types of goods
Effects of Destruction of Goods
In case of Contract of Sale[Section 7]
The contract of sale is void if the following three conditions are satisfied:
1.There must be a contract of sale for specific goods.
2.The goods must have become perished or so damaged as no longer to answer their
description in the contract, before making of the contract.
3.The seller must not be aware about the destruction of goods.
Example- X sold to Y all 700 bags of cement lying in his Delhi’s godown. State the legal position:
1.If unknown to X, all bags had been stolen before he contract was made.
2.If unknown to X, all cement had become stone as a result of heavy rainfall.
• Till 1930,the law relating to sale and purchase of goods were regulated by the
Indian contract act ,1872. In 1930, sections 76 to 123 of the Indian contract act,
1872 were repealed and separate act called ‘The Indian sale of goods act, 1930
was passed. It came into force on 1st July 1930.
ESSENTIALS OF A CONTRACT OF SALE
1)Two parties Buyer and Seller
2)Goods
3)Transfer of property
4)All Essential elements of a valid contract must be fulfilled
5)Price
6)Include both sale and agreement to sell
GOODS
Defintion-Sec2[7]The subject matter of a contract of a sale must be goods. The term ‘goods’ means
‘every kind of movable property other than actionable claims and money and includes stock and
shares, growing crops, and things attached to or forming part of the land which are agreed to be
served or under the contract of sale’.
, Types of goods
Effects of Destruction of Goods
In case of Contract of Sale[Section 7]
The contract of sale is void if the following three conditions are satisfied:
1.There must be a contract of sale for specific goods.
2.The goods must have become perished or so damaged as no longer to answer their
description in the contract, before making of the contract.
3.The seller must not be aware about the destruction of goods.
Example- X sold to Y all 700 bags of cement lying in his Delhi’s godown. State the legal position:
1.If unknown to X, all bags had been stolen before he contract was made.
2.If unknown to X, all cement had become stone as a result of heavy rainfall.
