Contract of sale

1. C L A S S – M B A
CONTRACT OF SALE
S U B J E C T – B U S I N E S S L A W

2. Contract of Sale
 Section 4 (1) of the Sale of Goods Act, 1930 defines
the term as 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.

4. Essentials of Contract of Sale
 There must be at least two parties (seller and buyer),
 The subject matter of the contract must necessarily be
goods,
 A price in money (not in kind) should be paid or promised,
 A transfer of property in goods from seller to the buyer
must take place,
 All other essential element of a valid contract must be.

5. Characteristics……
 Buyer and seller:-The person who buys the goods or makes
an agreement to buy is called the buyer. & the person who
sells the goods or makes an agreement to sell is called the
seller
 Goods:- The subject matter of the contract of the sale is
essential the goods are movable property other than the
actionable claim and money
 Price:- Goods are always sold for a price
 Transfer of ownership:- The transfer of ownership can be at
the time of making the contract or it can be at future date

6. SALE AND AGREEMENT TO SELL
 Sale:- Acc. to Section 4(1) of the Sale of Goods Act, 1930 -
“where under a contract of sale the property in the goods is
transferred from the seller to the buyer
 Agreement to Sell:- Acc. To section 4(3) of the Sale of
Goods Act,1930where under the contract of sale the
transfer of property in the goods is to take place ata future
time or subject to some condition thereafter to be fulfilled

7. Difference between Sale & Agreement to Sale
BASIS OF DIFF. SALE AGREEMENTTO SELL
Transfer of
Ownership
Ownership of goods is
transfer immediately.
Ownership of goods is not
transfer immediately
Risk follow
Ownership
Ownership and risk phases
by buyer.
Ownership of good not pass to
buyer hence risk also don’t pass.
Type of Contract Executed Contract Executory Contract
Subsequent loss
or destruction
It is the liability and
responsibility of Buyer
It is the liability and
responsibility of seller
Nature Absolute Conditional
Right to sell In hands of Buyer In hands of seller

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