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Group 10
Shamik Mukherjee (129278007) Suvajyoti Bhattacharjee (129278078) Sachin Chavare (129278104) Sorabh Gambhir (129278108) Nikhil Bansal (129278110)
Introduction
The law relating to sale of goods is contained in the Sale
of Goods Act, 1930 It has to be read as part of the Indian Contract Act, 1872
An agreement to sell becomes a sale when the time elapses; all the conditions are fulfilled subject to which the property in the goods is to be transferred
A customer who picks up goods in a self-service shop is merely offering to buy them and the sale is not complete until they are paid for
The term contract of sale includes both actual sales and agreement for sale.
Mutual consent
Parties competent to contract Free consent Lawful object Consideration ,etc
Earnest
The conclusion of a contract of sale is sometimes marked by the giving of earnest Earnest whether given in money or not must be something of value really given by the buyer and kept by the seller A mere symbolic
ceremony such as one party drawing a coin across the others hand
will not do When a deposit in the nature of earnest is paid for the same of immovable property in India, a vendor by whose default the sale goes off must return the sum so paid, but if the default is the purchasers the purchaser must loose it
Whether any other stipulation as to time is of the essence of the contract or not
depends on the terms of the contract Examples Sale of some stacks of oak on the sellers ground, upon the terms that they might remain there for four months and the buyer should pay within 12 weeks of the contract. The seller on the expiration of 12 weeks demanded the price which the buyer failed to pay. Later the buyer asked for further time which the seller refused
to give, and said that as the buyer had not paid he should not have the stacks. The
buyer later tendered the price, but the seller refused to accept it and subsequently resold the stacks. The Buyer was held entitled to recover in an action of trover. ( Martin Dale V/s. Smith 1841)
failure by the buyer to pay on the appointed day does not as a rule, entitle
the seller to treat the contract as repudiated, though he may be entitled to withhold delivery until the price is paid and to resell the goods if the buyer does not pay or tender the price within a reasonable time
Consequently, if before such resale the buyer tenders the price, even though
it be on a date after the date name in the contract the seller cannot, in the absence of a stipulation to the contrary, treat the contract as at an end and refuse to allow the buyer to have the goods; and a subsequent resale by him will be tortious The time cannot be taken to be the essence of the contract in case where the contract itself does not stipulate the time for payment of the price.
Express Condition
Express Warranty
Auxiliary promises or undertakings of which the breach is not intended to avoid the contract, but only to give a remedy in damages
ation
Inferred from all the circumstances of the case, that the parties intended to add such a stipulation to their contract, but did not put it into expressed Implied words Condition & Warranty
Puff
A vague and extravagant statement so preposterous in its nature that nobody could believe that anyone was misled by
2.
3.
Transfer of Property as Between Seller and Buyer Section 18 Goods must be ascertained
Goods must be ascertained: where there is contract for the sale of unascertained goods, no property in the goods is transferred to the buyer unless and until the goods are ascertained Transfer of property Property cannot pass until the goods are identified Part of a specific whole Property and risk Identification of goods
1. 2. 3. 4. 5.
Identification of goods
Individuality of the thing to be delivered should be established
Identification of goods
The property shall pass on the happening of some specified event, sufficient to identify the goods
1. Principles for determining whether the property is transferred 2. Intention of the parties 3. Ascertained goods
Ascertained goods Ascertained goods means goods identified in accordance with the agreement after the time a contract of sale is made
Section 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.
Section 22
Examples 1. Sale of a stack of bark at a certain price per ton, the bark to be weighed by the sellers and buyers agents. Part was weighed and taken away, but before anything more was done a flood carried away the remainder. The loss of this fell on the seller. Simmons Vs Swift (1826) 2. Sale of 289 specified bales of goatskin, containing 5 dozen in each bale, at a certain price per dozen. By the usage of the trade, it was the sellers duty to see whether the bales contain the number specified in the contract. Before the seller had done this the bales were destroyed by fire. The loss fell on the seller. Zagury vs Furnell(1809)
Notice given to principle by the exercise of reasonable diligence so as he can in time to prevent a deliver to the buyer.
Possessor of goods shall redeliver the goods
X got table made from carpenter, carpenter gave separate bill for material and services
Work contract and Sale of goods
X wanted a particular type of table, got made from carpenter for a one-time unclassified payment
On courts discretion
Contract of sale
The seller divests himself of all the proprietary right in the thing sold
The price charged was a lump-sum amount, without reference to material and work.
Deposits merely ensured the return of the bottles and the crates
The intention of UB or the retailer does not appear to have been to sell the beer bottles
Introduction
It is a commercial law Common law developed and further written down Negotiable Instrument (Section 13)
Promissory Notes Bills of Exchange Cheques
Concept of payable
Payable to order Payable to bearer Payable on demand
Promissory Note
Section 4 Instrument in writing Not a bank-note or a currency-note Unconditional undertaking Signed by the maker To pay a certain sum of money To, or to the order of, a certain person, or to the bearer I promise to pay B Rs 500 on demand A (signed) Currency-note: Promissory note payable to bearer, issued by RBI
Bill of Exchange
Section 5 Instrument in writing Unconditional undertaking Signed by the maker Directing a person to pay Certain sum of money To a person or the bearer Only RBI or the Central Government can draw or accept a bill of exchange, payable to bearer, on demand
Exception: Cheque drawn on a banker
Cheque
Section 6 Bill of exchange drawn on a specified banker Not expressed to be payable otherwise than on demand
Nuances
Section 18
Amount different in words and figures Amount in words
Section 43
No obligation of payment without consideration
Terminology
Drawer - maker, Drawee bank (Section 7) Holder (Section 8) Holder in due course consideration (Section 9) Negotiation transfer (Section 14)
Indorsement
Maker or holder signs on a negotiable instrument for the purpose of negotiation (Section 15) Types of indorsement (Section 16)
Indorsement in blank to bearer Indorsement in full to order payee
Indorser becomes the drawer for all the subsequent holders Maker, drawer, acceptor, and indorser are all liable to a holder in due course, until the instrument is paid up
Crossing of cheques
Sections 123-131 Open cheque payable at counter cash Crossed cheque payable through collecting banker
Parallel lines A/c Payee Not Negotiable Pay Cash
Dishonoured Cheque
Sections 91-98 Banks refusal to pay Instructions by drawer countermand Insufficient funds Signature
Noting
Section 99 Dishonour of promissory note or bill of exchange by non-acceptance or non-payment Holder gets a note on it from a notary public Certificate Protest (Section 100)
Bouncing of cheques
Section 138 Dishonour of cheque due to insufficient funds Offence
Issue of cheque to settle certain liabilities Cheque presented to the bank within 6 months and cheque dishonoured due to lack of sufficient funds
Notice to drawer within 30 days 15 days to make the payment Failure to pay 2 years of punishment, fine up to twice the amount, or both
All these cases have been filed under Section 138 Local Hyderabad court has issued non-bailable warrants against the airline chairman Vijay Mallya and three executives (Oct 13, 2012)
Case: M/s. Electronics Trade and Technology Development Corporation Limited, Securnderabad v. M/s. Indian Technologists & Engineers Supreme Court of India Cheque presented by complainant on Nov 28, 1990, through their Bankers M/s. Hyderabad Bank, Sarojini Devi Road, Secunderabad for realisation Accused had insufficient funds and had directed stoppage of payment The accuseds contest that the stoppage of payment was instructed was not upheld Judgement in favour of complainant
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