#THE SALE OF GOODS ACT, 1930 
______ 

##ARRANGMENT OF SECTIONS 
______ 

###CHAPTER I 

###PRELIMINARY 

SECTIONS 

1. Short title, extent and commencement. 
2. Definitions. 
3. Application of provisions of Act 9 of 1872. 

###CHAPTER II 

###FORMATION OF THE CONTRACT 

*Contract of Sale*

4. Sale and agreement to sell. 

*Formalities of the Contract*

5. Contract of sale how made. 

*Subject-matter of contract*

6. Existing or future goods. 
7. Goods perishing before making of contract. 
8. Goods perishing before sale but after agreement to sell.

*The price*

9. Ascertainment of price. 
10. Agreement to sell at valuation. 

*Conditions and warranties*

11. Stipulations as to time. 
12. Condition and warranty. 
13. When condition to be treated as warranty. 
14. Implied undertaking as to title, etc. 
15. Sale by description. 
16. Implied conditions as to quality or fitness. 
17. Sale by sample. 

###CHAPTER III 

###EFFECTS OF THE CONTRACT 

*Transfer of property as between seller and buyer*

18. Goods must be ascertained. 
19. Property passes when intended to pass. 
20. Specific goods in a deliverable state. 
21. Specific goods to be put into a deliverable state. 
22. Specific goods in a deliverable state, when the seller has to do anything thereto in order to 
  ascertain price. 
23. Sale of unascertained goods and appropriation. 
  Delivery to carrier. 
24. Goods sent on approval or “on sale or return”. 
25. Reservation of right of disposal. 
26. Risk prima facie passes with property. 

*Transfer of title*

27. Sale by person not the owner. 
28. Sale by one of joint owners. 
29. Sale by person in possession under voidable contract. 
30. Seller or buyer in possession after sale. 

###CHAPTER IV 

###PERFORMANCE OF THE CONTRACT 

31. Duties of seller and buyer. 
32. Payment and delivery are concurrent conditions. 
33. Delivery. 
34. Effect of part delivery. 
35. Buyer to apply for delivery. 
36. Rules as to delivery. 
37. Delivery of wrong quantity. 
38. Instalment deliveries. 
39. Delivery to carrier or wharfinger. 
40. Risk where goods are delivered at distant place. 
41. Buyer’s right of examining the goods. 
42. Acceptance. 
43. Buyer not bound to return rejected goods. 
44. Liability of buyer for neglecting or refusing delivery of goods. 

###CHAPTER V 

###RIGHTS OF UNPAID SELLER AGAINST THE GOODS 

45. “Unpaid seller” defined. 
46. Unpaid seller’s rights. 

*Unpaid seller’s lien*

47. Seller’s lien. 
48. Part delivery. 
49. Termination of lien. 

*Stoppage in transit*

50. Right of stoppage in transit. 
51. Duration of transit. 
52. How stoppage in transit is effected. 

*Transfer by buyer and seller*

53. Effect of sub-sale or pledge by buyer. 
54. Sale not generally rescinded by lien or stoppage in transit. 

###CHAPTER VI 

###SUITS FOR BREACH OF THE CONTRACT 

55. Suit for price. 
56. Damages for non-acceptance. 
57. Damages for non-delivery. 
58. Specific performance. 
59. Remedy for breach of warranty. 
60. Repudiation of contract before due date. 
61. Interest by way of damages and special damages. 

###CHAPTER VII 

###MISCELLANEOUS 

62. Exclusion of implied terms and conditions. 
63. Reasonable time a question of fact. 
64. Auction sale. 
64A. In contracts of sale, amount of increased or decreased taxes to be added or deducted. 
65. [Repealed.]. 
66. Savings. 



#THE SALE OF GOODS ACT, 1930 

##ACT NO. 3 OF 1930

[15th March, 1930.] 

An Act to define and amend the law relating to the sale of goods. 

  WHEREAS  it  is  expedient  to  define  and  amend  the  law  relating  to  the  sale  of  goods;  It  is  hereby 
enacted as follows:— 

###CHAPTER I 

###PRELIMINARY 

1. **Short title, extent and commencement.**—(1) This Act may be called the Sale of Goods Act, 1930. 

(2) It extends to the whole of India [^4]***.

(3) It shall come into force on the 1st day of July, 1930. 

2. **Definitions.**—In this Act, unless there is anything repugnant in the subject or context,— 

(1) “buyer” means a person who buys or agrees to buy goods; 

(2) “delivery” means voluntary transfer of possession from one person to another; 

(3) 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; 

(4) “document  of  title  to  goods”  includes  a  bill  of  lading,  dockwarrant,  warehouse  keeper’s 
certificate,  wharfingers’  certificate,  railway  receipt, [^5][multimodal  transport  document,]  warrant  or 
order  for  the  delivery  of  goods  and any  other  document  used  in  the ordinary  course of  business  as 
proof  of  the  possession  or  control  of  goods,  or  authorising  or  purporting  to  authorise,  either  by 
endorsement  or  by  delivery,  the  possessor  of  the  document  to  transfer  or  receive  goods  thereby 
represented; 

(5) “fault” means wrongful act or default; 

(6) “future goods” means goods to be manufactured or produced or acquired by the seller after the 
making of the contract of sale; 

(7) “goods” means every kind of moveable 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; 

(8) a person is said to be “insolvent” who has ceased to pay his debts in the ordinary course of 
business, or cannot pay his debts as they become due, whether he has committed an act of insolvency 
or not; 

(9) “mercantile agent” means a mercantile agent having in the customary course of business as 
such agent authority either to sell goods, or to consign goods for the purposes of sale, or to buy goods, 
or to raise money on the security of goods; 

(10) “price” means the money consideration for a sale of goods; 

[^4]. The  words  “except  the  State  of  Jammu  and  Kashmir”  omitted  by  Act  34  of  2019,  s.  95  and  the  Fifth  Schedule 
(w.e.f. 31-10-2019).. 
[^5]. Ins. by Act 28 of 1993, s. 31 and the Schedule, Part III. 



(11) “property” means the general property in goods, and not merely a special property; 

(12) “quality of goods” includes their state or condition; 

(13) “seller” means a person who sells or agrees to sell goods; 

(14) “specific  goods”  means  goods  identified  and  agreed  upon  at  the  time  a  contract  of  sale  is 
made; and 

(15) expressions  used  but not  defined in  this  Act and  defined in the  Indian  Contract  Act,  1872 
(9 of 1872), have the meaning assigned to them in that Act. 

3. **Application of provisions of Act 9 of 1872.**—The unrepealed provisions of the Indian Contract 
Act, 1872, save in so far as they are inconsistent with the express provisions of this Act, shall continue to 
apply to contracts for the sale of goods. 

###CHAPTER II 

###FORMATION OF THE CONTRACT 

*Contract of sale*

4. **Sale and agreement to sell.**—(1)  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 a price. There may be a contract of 
sale between one part-owner and another. 

(2) A contract of sale may be absolute or conditional. 

(3) 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 an agreement to sell. 

(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. 

*Formalities of the contract*

5. **Contract of sale how made.**—(1) 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  instalments,  or  that  the 
delivery or payment or both shall be postponed. 

(2) Subject to the provisions of any law for the time being in force, a contract of sale may be made in 
writing or by word of mouth, or partly in writing and partly by word of mouth or may be implied from the 
conduct of the parties. 

*Subject-matter of contract*

6. **Existing or future goods.**—(1)  The  goods  which  form  the  subject  of  a  contract  of  sale  may  be 
either existing goods, owned or possessed by the seller, or future goods. 

(2) There may be a contract for the sale of goods the acquisition of which by the seller depends upon 
a contingency which may or may not happen. 

(3) Where by a contract of sale the seller purports to effect a present sale of future goods, the contract 
operates as an agreement to sell the goods. 

7. **Goods perishing before making of contract.** — Where there is a contract for the sale of specific 
goods, the contract is void 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. 

8. **Goods perishing before sale but after agreement to sell.**—Where there is an agreement to sell 
specific goods, and subsequently the goods without any fault on the part of the seller or buyer perish or 
become so damaged as no longer to answer to their description in the agreement before the risk passes to 
the buyer, the agreement is thereby avoided. 

*The price*

9. **Ascertainment of price.**—(1) 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. 

(2) Where  the  price  is  not  determined  in  accordance  with  the  foregoing  provisions,  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. 

10. **Agreement to sell at valuation.**—(1) Where there is an agreement to sell goods on the terms that 
the price is to be fixed by the valuation of a third party and such third party cannot or does not make such 
valuation, the agreement is thereby avoided: 

  Provided that, if the goods or any part thereof have been delivered to, and appropriated by, the buyer, 
he shall pay a reasonable price therefor. 

(2) Where such third party is prevented from making the valuation by the fault of the seller or buyer, 
the party not in fault may maintain a suit for damages against the party in fault. 

*Conditions and waranties*

11. **Stipulations as to time.**—Unless  a  different  intention  appears  from  the  terms  of  the  contract, 
stipulations as to time of payment arc not deemed to be of the essence of a contract of sale. Whether any 
other Stipulation as to time is of the essence of the contract or not depends on the terms of the contract. 

12. **Condition and warranty.**—(1) A stipulation in a contract of sale with reference to goods which 
are the subject thereof may be a condition or a warranty. 

(2) A  condition  is  a  stipulation  essential  to  the  main  purpose  of  the  contract,  the  breach  of  which 
gives rise to a right to treat the contract as repudiated. 

(3) A  warranty  is  a  stipulation  collateral  to  the  main  purpose  of  the  contract,  the  breach  of  which 
gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated. 

(4) Whether a stipulation in a contract of sale is a condition or a warranty depends in each case on the 
construction of the contract. A stipulation may be a condition, though called a warranty in the contract. 

13. **When condition to be treated as warranty.**—  (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. 

(2) Where  a  contract  of sale is  not  severable  and  the  buyer  has  accepted the  goods  or  part thereof, 
the breach of any condition 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. 

(3) Nothing in this section shall affect the case of any condition or warranty fulfilment of which is 
excused by law by reason of impossibility or otherwise. 

14. **Implied undertaking as to title, etc.**—In  a  contract  of  sale,  unless  the  circumstances  of  the 
contract are such as to show a different intention, there is— 

  (a) an implied condition on the part of the seller that, in the case of a 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; 

  (b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods; 

  (c) an implied warranty that the goods shall be free from any charge or encumbrance in favour of 
any third party not declared or known to the buyer before or at the time when the contract is made. 

15. **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; and,  if  the  sale  is  by  sample  as 
well as by description, it is not sufficient that the bulk of the goods corresponds with the sample if the 
goods do not also correspond with the description. 

16. **Implied conditions as to quality or fitness.**—Subject to  the  provisions  of  this  Act  and  of  any 
other law for the time being in force, there is no implied warranty or condition as to the quality or fitness 
for any particular purpose of goods supplied under a contract of sale, except as follows:— 

(1) Where  the  buyer,  expressly  or  by  implication,  makes  known  to  the  seller  the  particular 
purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or 
judgment, and the goods are of a description which it is in the course of the seller’s business to supply 
(whether he is the manufacturer or producer or not), there is an implied condition that the goods shall 
be reasonably fit for such purpose: 

  Provided that, in the case of a contract for the sale of a specified article under its patent or other 
trade name, there is no implied condition as to its fitness for any particular purpose. 

(2) Where goods are bought by description from a seller who deals in goods of that description 
(whether he is the manufacturer or producer or not), there is an implied condition that the goods shall 
be of merchantable quality: 

  Provided that, if the buyer has examined the goods, there shall be no implied condition as regards 
defects which such examination ought to have revealed. 

(3) An  implied  warranty  or  condition  as  to  quality  or  fitness  for  a  particular  purpose  may  be 
annexed by the usage of trade. 

(4) An express warranty or condition does not negative a warranty or condition implied by this 
Act unless inconsistent therewith. 

17. **Sale by sample.**— (1) A contract of sale is a contract for sale by sample where there is a term in 
the contract, express or implied, to that effect. 

(2) In the case of a contract for sale by sample there is an implied condition— 

  (a) that the bulk shall correspond with the sample in quality; 

  (b) that the buyer shall have a reasonable opportunity of comparing the bulk with the sample; 

  (c) that the goods shall be free from any defect, rendering them unmerchantable, which would not 
be apparent on reasonable examination of the sample. 

###CHAPTER III 

###EFFECTS OF THE CONTRACT 

*Transfer of property as between seller and buyer*

18. **Goods must be ascertained.**— Where there is a contract for the sale of unascertained goods, no 
property in the goods is transferred to the buyer unless and until the goods are ascertained. 

19. **Property passes when intended to pass.**— (1) Where there is a contract for the sale of specific 
or  ascertained  goods  the  property  in  them  is  transferred  to  the  buyer  at  such  time  as  the  parties  to  the 
contract intend it to he transferred. 

(2) For the purpose of ascertaining the intention of the parties regard shall be had to the terms of the 
contract, the conduct of the parties and the circumstances of the case. 

(3) Unless  a  different  intention  appears,  the  rules  contained  in  sections  20  to  24  are  rules  for 
ascertaining the intention of the parties as to the time at which the property in the goods is to pass to the 
buyer. 

20. **Specific goods in a deliverable state.**— Where there is an unconditional contract for the sale of 
specific goods in a deliverable state, the property in the goods passes to the buyer when the  contract is 
made, and it is immaterial whether the time of payment of the price or the time of delivery of the goods, 
or both, is postponed. 

21. **Specific goods to be put into a deliverable state.**—Where  there  is  a  contract  for  the  sale  of 
specific goods and the seller is bound to do something to the goods for the purpose of putting them into a 
deliverable state, the property does not pass until such thing is done and the buyer has notice thereof. 

22. **Specific goods in a deliverable state, when the seller has to do anything thereto in order to 
ascertain price.**—Where there is a contract for the sale of specific goods in a deliverable state, but the 
seller is bound to weigh, measure, test or do some other act or thing with reference to the goods for the 
purpose of ascertaining the price, the property does not pass until such act or thing is done and the buyer 
has notice thereof. 

23. **Sale of unascertained goods and appropriation.**—(1) Where there is a contract for the sale of 
unascertained or future goods by description and goods of that description and in a deliverable state are 
unconditionally  appropriated  to  the  contract,  either  by  the  seller  with  the  assent  of  the  buyer  or  by  the 
buyer with the assent of the seller, the property in the goods thereupon passes to the buyer. Such assent 
may be express or implied, and may by given either before or after the appropriation is made 

**Delivery to carrier.**—(2)  Where,  in  pursuance  of  the  contract,  the  seller  delivers  the  goods  to  the 
buyer or to a carrier or other bailee (whether named by the buyer or not) for the purpose of transmission 
to the buyer, and does not reserve the right of disposal, he is deemed to have unconditionally appropriated 
the goods to the contract. 

24. **Goods sent on approval or “on sale or return”.**—When  goods  are  delivered to the  buyer  on 
approval or “on sale or return” or other similar terms, the property therein passes to the buyer— 

  (a) when he signifies his approval or acceptance to the seller or does any other act adopting the 
transaction; 

  (b) if he does not signify his approval or acceptance to the seller but retains the goods without 
giving notice of rejection, then, if a time has been fixed for the return of the goods, on the expiration 
of such time, and, if no time has been fixed, on the expiration of a reasonable time. 

25. **Reservation of right of disposal.**—(1) Where there is a contract for the sale of specific goods or 
where goods are subsequently appropriated to the contract, the seller may, by the terms of the contract or 
appropriation, reserve the right of disposal of the goods until certain conditions are fulfilled. In such case, 
notwithstanding  the  delivery  of  the  goods  to  a  buyer  or  to  a  carrier  or  other  bailee  for  the  purpose  of 
transmission  to  the  buyer,  the  property  in  the  goods  does  not  pass  to  the  buyer  until  the  conditions 
imposed by the seller are fulfilled. 

(2) Where goods are shipped or delivered to a railway administration for carriage by railway and by 
the bill of lading or railway receipt, as the case may be, the goods are deliverable to the order of the seller 
or his agent, the seller is prima facie deemed to reserve the right of disposal. 

(3) Where the seller of goods draws on the buyer for the price and transmits to the buyer the bill of 
exchange together with the bill of lading or, as the case may be, the railway receipt, to secure acceptance 
or payment of the bill of exchange, the buyer is bound to return the bill of lading or the railway receipt if 
he  does  not  honour  the  bill  of  exchange;  and, if  he wrongfully  retains  the  bill of  lading  or  the  railway 
receipt, the property in the goods does not pass to him. 

*Explanation.* —In this section, the expressions “railway” and “railway administration” shall have the 
meanings respectively assigned to them under the Indian Railways Act, 1890 (9 of 1890). 

26. **Risk** *prima facie* **passes with property.**—Unless  otherwise  agreed,  the  goods  remain  at  the 
seller’s  risk  until  the  property  therein  is  transferred  to  the  buyer,  but  when  the  property  therein  is 
transferred to the buyer, the goods are at the buyer’s risk whether delivery has been made or not: 

  Provided that, where delivery has been delayed through the fault of either buyer or seller, the goods 
are at the risk of the party in fault as regards any loss which might not have occurred but for such fault: 

  Provided also that nothing in this section shall affect the duties or liabilities of either seller or buyer as 
a bailee of the goods of the other party. 

*Transfer of title*

27. **Sale by person not the owner.**—Subject to the provisions of this Act and of any other law for the 
time being in force, where goods are sold by a person who is not the owner thereof and who does not sell 
them under the authority or with the consent of the owner, the buyer acquires no better title to the goods 
than the seller had, unless the owner of the goods is by his conduct precluded from denying the seller’s 
authority to sell: 

  Provided that, where a mercantile agent is, with the consent of the owner, in possession of the goods 
or of  a  document  of  title  to  the  goods,  any  sale  made  by  him,  when  acting  in  the  ordinary  course  of 
business of a mercantile agent, shall be as valid as if he were expressly authorised by the owner of the 
goods to make the same; provided that the buyer acts in good faith and has not at the time of the contract 
of sale notice that the seller has not authority to sell. 

28. **Sale by one of joint owners.**— If one of several joint owners of goods has the sole possession of 
them  by  permission  of  the  co-owners,  the  property  in  the  goods  is  transferred  to  any  person  who  buys 
them of such joint owner in good faith and has not at the time of the contract of sale notice that the seller 
has not authority to sell. 

29. **Sale by person in possession under voidable contract.**—When the seller of goods has obtained 
possession thereof under a contract voidable under section 19 or section 19A of the Indian Contract Act, 
1872 (9 of 1872), but the contract has not been rescinded at the time of the sale, the buyer acquires a good 
title to the goods, provided he buys them in good faith and without notice of the seller’s defect of title. 

30. **Seller or buyer in possession after sale.**—(1) Where a person, having sold goods, continues or is 
in possession of the goods or of the documents of title to the goods, the delivery or transfer by that person 
or by a mercantile agent acting for him, of the goods or documents of title under any sale, pledge or other 
disposition thereof to any person receiving the same in good faith and without notice of the previous sale 
shall have the same effect as if the person making the delivery or transfer were expressly authorised by 
the owner of the goods to make the same. 

(2) Where  a  person,  having  bought  or  agreed  to  buy  goods,  obtains,  with the  consent  of the  seller, 
possession of the goods or the documents of title to the goods, the delivery or transfer by that person or by 
a  mercantile  agent  acting  for  him,  of  the  goods  or  documents  of  title  under  any  sale,  pledge  or  other 
disposition thereof to any person receiving the same in good faith and without notice of any lien or other 
right of the original seller in respect of the goods shall have effect as if such lien or right did not exist. 

###CHAPTER IV 

###PERFORMANCE OF THE CONTRACT 

31. **Duties, of seller and buyer.**— It is the duty to the seller to deliver the goods and of the buyer to 
accept and pay for them, in accordance with the terms of the contract of sale. 

32. **Payment and delivery are concurrent conditions.**—Unless  otherwise  agreed,  delivery  of  the 
goods  and  payment  of  the  price  are  concurrent  conditions,  that  is  to  say,  the  seller  shall  be  ready  and 
willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready 
and willing to pay the price in exchange for possession of the goods. 

33. **Delivery.**—Delivery of goods sold may be made by doing anything which the parties agree shall 
be treated as delivery or which has the effect of putting the goods in the possession of the buyer or of any 
person authorised to hold them on his behalf. 

34. **Effect of part delivery.**—A delivery of part of goods, in progress of the delivery of the whole, 
has the same effect, for the purpose of passing the property in such goods, as a delivery of the whole; but 
a  delivery  of  part  of  the  goods,  with  an  intention  of  severing  it  from  the  whole,  does  not  operate  as  a 
delivery of the remainder. 

35. **Buyer to apply for delivery.**— Apart from any express contract, the seller of goods is not bound 
to delivery them until the buyer applies for delivery. 

36. **Rules as to delivery.**— (1) Whether it is for the buyer to take possession of the goods or for the 
seller to send them to the buyer is a question depending in each case on the contract, express or implied, 
between the parties. Apart from any such contract, goods sold are to be delivered at the place at which 
they are at the time of the sale, and goods agreed to be sold are to be delivered at the place at which they 
are  at  the  time  of  the  agreement  to  sell,  or,  if  not  then  in  existence,  at  the  place  at  which  they  are 
manufactured or produced. 

(2) Where under the contract of sale the seller is bound to send the goods to the buyer, but no time 
for sending them is fixed, the seller is bound to send them within a reasonable time. 

(3) Where the goods at the time of sale are in the possession of a third person, there is no delivery by 
seller to buyer unless and until such third person acknowledges to the buyer that he holds the goods on his 
behalf: 

  Provided that nothing in this section shall affect the operation of the issue or transfer of any document 
of title to goods. 

(4) Demand  or  tender  of  delivery  may  be  treated  as  ineffectual  unless  made  at  a  reasonable  hour. 
What is a reasonable hour is a question of fact. 

(5) Unless  otherwise  agreed,  the  expenses  of  and  incidental  to  putting  the  goods  into  a  deliverable 
state shall be borne by the seller. 

37. **Delivery of wrong quantity.**—(1) Where the seller delivers to the buyer a quantity of goods less 
than he contracted to sell, the buyer may reject them, but it the buyer accepts the goods so delivered he 
shall pay for them at the contract rate. 

(2) Where  the  seller  delivers  to the  buyer  a  quantity  of  goods  larger  than  he  contracted  to sell, the 
buyer may accept the goods included in the contract and reject the rest, or he may reject the whole. If the 
buyer accepts the whole of the goods so delivered, he shall pay for them at the contract rate. 

(3) Where  the  seller  delivers  to  the  buyer  the  goods  he  contracted  to  sell  mixed  with  goods  of  a 
different description not included in the contract, the buyer may accept the goods which are in accordance 
with the contract and reject the rest, or may reject the whole. 

(4) The  provisions  of  this section  are  subject  to  any usage  of  trade,  special  agreement  or  course  of 
dealing between the parties. 

38. **Instalment deliveries.**—(1) Unless otherwise agreed, the buyer of goods is not bound to accept 
delivery thereof by instalments. 

(2) Where there is a contract for the sale of goods to be delivered by stated instalments which are to 
be separately paid for, and the seller makes no delivery or defective delivery in respect of one or more 
instalments, or the buyer neglects or refuses to take delivery of or pay for one or more instalments, it is a 
question in each case depending on the terms of the contract and the circumstances of the case, whether 
the breach of contract is a repudiation of the whole contract, or whether it is a severable breach giving rise 
to a claim for compensation, but not to a right to treat the whole contract as repudiated. 

39. **Delivery to carrier or wharfinger.**—(1) Where, in pursuance of a contract of sale, the seller is 
authorised or required to send the goods to the buyer, delivery of the goods to a carrier, whether named by 
the buyer or not, for the purpose of transmission to the buyer, or delivery of the goods to a wharfinger for 
safe custody, is prima facie deemed to be a delivery of the goods to the buyer. 

(2) Unless otherwise authorised by the buyer, the seller shall make such contract with the carrier or 
wharfinger on behalf of the buyer as may be reasonable having regard to the nature of the goods and the 
other circumstances of the case. If the seller omits so to do, and the goods are lost or damaged in course 
of  transit  or  whilst  in  the  custody  of  the  wharfinger,  the  buyer  may  decline  to  treat  the  delivery  to  the 
carrier or wharfinger as a delivery to himself, or may hold the seller responsible in damages. 

(3) Unless otherwise agreed, where goods are sent by the seller to the buyer by a route involving sea 
transit, in curcumstances in which it is usual to insure, the seller shall give such notice to the buyer as 
may enable him to insure them during their sea transit, and if the seller fails so to do, the goods shall be 
deemed to be at his risk during such sea transit. 

40. **Risk where goods are delivered at distant place.**—Where the seller of goods agrees to deliver 
them at his own risk at a place other than that where they are when sold, the buyer shall, nevertheless, 
unless otherwise agreed, take any risk of deterioration in the goods necessarily incident to the course of 
transit. 

41. **Buyer’s right of examining the goods.**—(1) Where goods are delivered to the buyer which he 
has  not  previously  examined,  he  is  not  deemed  to  have  accepted  them  unless  and  until  he  has  had  a 
reasonable opportunity of examining them for the purpose of ascertaining whether they are in conformity 
with the contract. 

(2) Unless otherwise agreed, when the seller tenders delivery of goods to the buyer, he is bound, on 
request,  to  afford  the  buyer  a  reasonable  opportunity  of  examining  the  goods  for  the  purpose  of 
ascertaining whether they are in conformity with the contract. 

42. **Acceptance.**—The buyer is deemed to have accepted the goods when he intimates to the seller 
that he has accepted them, or when the goods have been delivered to him and he does any act in relation 
to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable 
time, he retains the goods without intimating to the seller that he has rejected them. 

43. **Buyer not bound to return rejected goods.**—Unless  otherwise  agreed,  where  goods  are 
delivered to the buyer and he refuses to accept them, having the right so to do, he is not bound to return 
them to the seller, but it is sufficient if he intimates to the seller that he refuses to accept them. 

44. **Liability of buyer for neglecting or refusing delivery of goods.**—When the seller is ready and 
willing  to  deliver  the  goods  and  requests  the  buyer  to  take  delivery,  and  the  buyer  does  not  within  a 
reasonable  time  after  such  request  take  delivery  of  the  goods,  he  is  liable  to  the  seller  for  any  loss 
occasioned  by  his  neglect or  refusal  to  take  delivery,  and also  for a  reasonable charge for the  care  and 
custody of the goods: 

  Provided that nothing in this section shall affect the rights of the seller where the neglect or refusal of 
the buyer to take delivery amounts to a repudiation of the contract. 

###CHAPTER V 

###RIGHTS OF UNPAID SELLER AGAINST THE GOODS 

45. **“Unpaid seller” defined.**—(1) The seller of goods is deemed to be an “unpaid seller” within the 
meaning of this Act— 

  (a) when the whole of the price has not been paid or tendered; 

  (b) when  a  bill  of  exchange  or  other  negotiable  instrument  has  been  received  as  conditional 
payment, and the condition on which it was received has not been fulfilled by reason of the dishonour 
of the instrument or otherwise. 

(2) In  this  Chapter,  the  term  “seller”  includes  any  person  who  is  in  the  position  of  a  seller,  as,  for 
instance, an agent of the seller to whom the bill of lading has been endorsed, or a consignor or agent who 
has himself paid, or is directly responsible for, the price. 

46. **Unpaid seller’s sights.**—(1) Subject to the provisions of this Act and of any law for the time 
being in force, notwithstanding that the property in the goods may have passed to the buyer, the unpaid 
seller of goods, as such, has by implication of law— 

  (a) a lien on the goods for the price while he is in possession of them; 

  (b) in  case  of  the  insolvency  of  the  buyer  a  right  of  stopping  the  goods  in  transit  after  he  has 
parted with the possession of them; 

  (c) a right of re-sale as limited by this Act. 

(2) Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his 
other  remedies,  a  right  of  withholding  delivery  similar  to  and  co-extensive  with  his  rights  of  lien  and 
stoppage in transit where the property has passed to the buyer. 

*Unpaid seller’s lien*

47. **Seller’s lien.**—(1)  Subject  to  the  provisions  of  this  Act,  the  unpaid  seller  of  goods  who  is  in 
possession  of  them  is  entitled  to  retain  possession  of  them  until  payment  or  tender  of  the  price  in  the 
following cases, namely:— 

  (a) where the goods have been sold without any stipulation as to credit; 

  (b) where the goods have been sold on credit, but the term of credit has expired; 

  (c) where the buyer becomes insolvent. 

(2) The seller may exercise his right of lien notwithstanding that he is in possession of the goods as 
agent or bailee for the buyer. 

48. **Part delivery.**—Where an unpaid seller has made part delivery of the goods, he may exercise his 
right of lien on the remainder, unless such part delivery has been made under such circumstances as to 
show an agreement to waive the lien. 

49. **Termination of lien.**—(1) The unpaid seller of goods loses his lien thereon— 

  (a) when he delivers the goods to a carrier or other bailee for the purpose of transmission to the 
buyer without reserving the right of disposal of the goods; 

  (b) when the buyer or his agent lawfully obtains possession of the goods; 

  (c) by waiver thereof. 

(2) The unpaid seller of goods, having a lien thereon, does not lose his lien by reason only that he has 
obtained a decree for the price of the goods. 

*Stoppage in transit*

50. **Right of stoppage in transit.**—Subject to the  provisions  of  this  Act,  when  the  buyer  of  goods 
becomes  insolvent,  the  unpaid  seller  who  has  parted  with  the  possession  of  the  goods  has  the  right  of 
stopping them in transit, that is to say, he may resume possession of the goods as long as they are in the 
course of transit, and may retain them until payment or tender of the price. 

51. **Duration of transit.**—(1) Goods are deemed to be in course of transit from the time when they 
are delivered to a carrier or other bailee for the purpose of transmission to the buyer, until the buyer or his 
agent in that behalf takes delivery of them from such carrier or other bailee. 

(2) If  the  buyer  or  his  agent  in  that  behalf  obtains  delivery  of  the  goods  before  their  arrival  at  the 
appointed destination, the transit is at an end. 

(3) If,  after  the  arrival  of  the  goods  at  the  appointed  destination,  the  carrier  or  other  bailee 
acknowledges to the buyer or his agent that he holds the goods on his behalf and continues in possession 
of  them  as  bailee  for  the  buyer  or  his  agent,  the  transit  is  at  an  end  and  it  is  immaterial  that  a  further 
destination for the goods may have been indicated by the buyer. 

(4) If the goods are rejected by the buyer and the carrier or other bailee continues in possession of 
them, the transit is not deemed to be at an end, even if the seller has refused to receive them back. 

(5) When  goods  are  delivered  to  a  ship  chartered  by  the  buyer,  it  is  a  question  depending  on  the 
circumstances of the particular case, whether they are in the possession of the master as a carrier or as 
agent of the buyer. 

(6) Where the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent 
in that behalf, the transit is deemed to be at an end. 

(7) Where  part  delivery  of  the  goods  has  been  made  to  the  buyer  or  his  agent  in  that  behalf,  the 
remainder  of  the  goods  may  be  stopped  in  transit,  unless  such  part  delivery  has  been  given  in  such 
circumstances as to show an agreement to give up possession of the whole of the goods. 

52. **How stoppage in transit is effected.**—(1) The unpaid sellermay exercise his right of stoppage in 
transit either by taking actual possession of the goods, or by giving notice of his claim to the carrier or 
other bailee in whose possession the goods are. Such notice may be given either to the person in actual 
possession of the goods or to his principal. In the latter case the notice, to be effectual, shall be given at 
such  time  and  in  such  circumstances  that  the  principal,  by  the  exercise  of  reasonable  diligence,  may 
communicate it to his servant or agent in time to prevent a delivery to the buyer. 

(2) When notice of stoppage in transit is given by the seller to the carrier or other bailee in possession 
of the goods, he shall re-deliver the goods to, or according to the directions of, the seller. The expenses of 
such re-delivery shall be borne by the seller. 

*Transfer by buyer and seller*

53. **Effect of sub-sale or pledge by buyer.**—(1) Subject to the provisions of this Act, the unpaid 
seller’s right  of lien  or  stoppage  in  transit is  not  affected  by  any  sale  or  other disposition  of  the  goods 
which the buyer may have made, unless the seller has assented thereto: 

  Provided that where a document of title to goods has been issued or lawfully transferred to any person 
as  buyer  or  owner  of  the  goods,  and  that  person  transfers  the  document  to  a  person  who  takes  the 
document in good faith and for consideration, then, if such last mentioned transfer was by way a sale, the 
unpaid seller’s right of lien or stoppage in transit is defeated, and, if such last mentioned transfer was by 
way  of  pledge  or  other  disposition  for  value,  the  unpaid  seller’s  right  of lien  or  stoppage  is  transit  can 
only be exercised subject to the rights of the transferee. 

(2) Where  the  transfer  is  by  way  of  pledge,  the  unpaid  seller  may  require  the  pledgee  to  have  the 
amount secured by the pledge satisfied in the first instance, as far as possible, out of any other goods or 
securities of the buyer in the hands of the pledgee and available against the buyer 

54. **Sale not generally rescinded by lien or stoppage in transit.**—(1) Subject to the provisions of 
this section, a contract of sale is not rescinded by the mere exercise by an unpaid seller of his right of lien 
or stoppage in transit. 

(2) Where the goods are of a perishable nature, or where the unpaid seller who has exercised his right 
of lien or stoppage in transit gives notice to the buyer of his intention to re-sell, the unpaid seller may, if 
the buyer does not within a reasonable time pay or tender the price, re-sell the goods within a reasonable 
time and recover from the original buyer damages for any loss occasioned by his breach of contract, but 
the buyer shall not be entitled to any profit which may occur on the re-sale. If such notice is not given, the 
unpaid seller shall not be entitled to recover such damages and the buyer shall be entitled to the profit, if 
any, on the re-sale. 

(3) Where an unpaid seller who has exercised his right of lien or stoppage in transit re-sells the goods, 
the buyer acquires a good title thereto as against the original buyer, notwithstanding that no notice of the 
re-sale has been given to the original buyer. 

(4) Where the seller expressly reserves a right of re-sale in case the buyer should make default, and, 
on  the  buyer  making  default,  re-sells  the  goods,  the  original  contract  of  sale  is  thereby  rescinded,  but 
without prejudice to any claim which the seller may have for damages. 

###CHAPTER VI 

###SUITS FOR BREACH OF THE CONTRACT 

55. **Suit for price.**—(1) Where under a contract of sale the property in the goods has passed to the 
buyer  and  the  buyer  wrongfully  neglects  or  refuses  to  pay  for  the  goods  according  to  the  terms  of  the 
contract, the seller may sue him for the price of the goods. 

(2) Where under a contract of sale the price is payable on a day certain irrespective of delivery and 
the buyer wrongfully neglects or refuses to pay such pirce, the seller may sue him for the price although 
the property in the goods has not passed and the goods have not been appropriated to the contract. 

56. **Damages for non-acceptance.**—Where  the  buyer  wrongfully  neglects  or  refuses  to  accept  and 
pay for the goods, the seller may sue him for damages for non-acceptance. 

57. **Damages for non-delivery.**—Where  the  seller  wrongfully  neglects  or  refuses  to  deliver  the 
goods to the buyer, the buyer may sue the seller for damages for non-delivery. 

58. **Specific performance.**—Subject to the provisions of Chapter II of the Specific Relief Act, 1877 
(1 of 1877), in any suit for breach of contract to deliver specific or ascertained goods, the Court may, if it 
thinks  fit,  on  the  application  of  the  plaintiff,  by  its  decree  direct  that  the  contract  shall  be  performed 
specifically, without giving the defendant the option of retaining the goods on payment of damages. The 
decree may be unconditional, or upon such terms and conditions as to damages, payment of the  price or 
otherwise, as the Court may deem just, and the application of the plaintiff may be made at any time before 
the decree. 

59. **Remedy for breach of warranty.**—(1)  Where  there  is  a  breach  of  warranty  by  file  seller,  or 
where  the  buyer  elects  or is  compelled  to  treat  any  breach  of  a  condition  on  the  part  of  the  seller  as  a 
breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods; 
but he may— 

  (a) set up against the seller the breach of warranty in diminution or extinction of the price; or 

  (b) sue the seller for damages for breach of warranty. 

(2) The fact that a buyer has set up a breach of warranty in diminution or extinction of the price does 
not prevent him from suing for the same breach of warranty if he has suffered further damage. 

60. **Repudiation of contract before due date.**—Where either party to a contract of sale repudiates 
the contract before the date of delivery, the other may either treat the contract as subsisting and wait till 
the date of delivery, or he may treat the contract as rescinded and sue for damages for the breach. 

61. **Interest by way of damages and special damages.**—(1) Nothing in this Act shall affect the right 
of  the  seller  or  the  buyer  to  recover  interest  or  special  damages  in  any  case  where  by  law  interest  or 
special  damages  may  be  recoverable,  or  to  recover  the  money  paid  where  the  consideration  for  the 
payment of it has failed. 

(2) In the absence of a contract to the contrary, the Court may award interest at such rate as it thinks 
fit on the amount of the price— 

  (a) to the seller in a suit by him for the amount of the price— from the date of the tender of the 
goods or from the date on which the price was payable; 

  (b) to the buyer in a suit by him for the refund of the price in a case of a breach of the contract on 
the part of the seller—from the date on which the payment was made. 

###CHAPTER VII 

###MISCELLANEOUS 

62. **Exclusion of implied terms and conditions.**—Where  any  right,  duty  or  liability  would  arise 
under a contract of sale by implication of law, it may be negatived or varied by express agreement or by 
the course of dealing between the parties, or by usage, if the usage is such as to bind both parties to the 
contract. 

63. **Reasonable time a question of fact.**—Where in this Act any reference is made to a reasonable 
time, the question what is a reasonable time is a question of fact. 

64. **Auction sale.** —In the case of a sale by auction— 

(1) Where goods are put up for sale in lots, each lot is prima facie deemed to be the subject of a 
separate contract of sale; 

(2) the sale is complete when the auctioneer announces its completion by the fall of the hammer 
or in other customary manner; and, until such announcement is made, any bidder may retract his bid; 

(3) a right to bid may be reserved expressely by or on behalf of the seller and, where such right is 
expressly so reserved, but not otherwise, the seller or any one person on his behalf may, subject to the 
provisions hereinafter contained, bid at the auction; 

(4) where the sale is not notified to be subject to a right to bid on behalf of the seller, it shall not 
be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer 
knowingly to take any bid from the seller or any such person; and any sale contravening this rule may 
be treated as fraudulent by the buyer; 

(5) the sale may be notified to be subject to a reserved or upset, price; 

(6) if the seller makes use of pretended bidding to raise the price, the sale is voidable at the option 
of the buyer. 

64A. **In contracts of sale, amount of increased or decreased taxes to be added or deducted.**—
(1) Unless a different intention appears from the terms of the contract, in the event of any tax of the nature 
described in sub-section (2) being imposed, increased, decreased or remitted in respect of any goods after 
the making of any contract for the sale or purchase of such goods without stipulation as to the payment of 
tax where tax was not chargeable at the time of the making of the contract, or for the sale or purchase of 
such goods tax-paid where tax was chargeable at that time,— 

  (a) if such imposition or increase so takes effect that the tax or increased tax, as the case may be, 
or any part of such tax is paid or is payable, the seller may add so much to the contract price as will 
be equivalent to the amount paid or payable in respect of such tax or increase of tax, and he shall be 
entitled to be paid and to sue for and recover such addition; and 

  (b) if such decrease or remission so takes effect that the decreased tax only, or no tax, as the case 
may  be,  is  paid  or  is  payable,  the  buyer  may  deduct  so  much  from  the  contract  price  as  will  be 
equivalent to the decrease of tax or remitted tax, and he shall not be liable to pay, or be sued for, or in 
respect of, such deduction. 

(2) The provisions of sub-section (1) apply to the following taxes, namely:— 

  (a) any duty of customs or excise on goods; 

  (b) any tax on the sale or purchase of goods.

65. *[Repeal.] Rep. by the Repealing Act,* 1938 (1 of 1938), s. 2 *and Sch.*

66. **Savings.**—(1) Nothing in this Act or in any repeal effected thereby shall affect or be deemed to 
affect— 

  (a) any right, title, interest, obligation or liability already acquired, accrued or incurred before the 
commencement of this Act, or 

  (b) any  legal  proceedings  or  remedy  in  respect  of  any  such  right,  title,  interest,  obligation  or 
liability, or 

  (c) anything done or suffered before the commencement of this Act, or 

  (d) any enactment relating to the sale of goods which is not expressly repealed by this Act, or 

  (e) any rule of law not inconsistent with this Act. 

(2) The rules of insolvency relating to contracts for the sale of goods shall continue to apply thereto, 
notwithstanding anything contained in this Act. 

(3) The provisions of this Act relating to contracts of sale do not apply to any transaction in the form 
of a contract of sale which is intended to operate by way of mortgage, pledge, charge or other security.