The Sale of Goods Act

• State of M.P. v. Orient Paper Mills Ltd., (1977) 2 SCC 77

Supreme Court in held that standing timber is a moveable property if trees are agreed to be severed under the contract.

• Al Jazeera Steel Products Co. SOAG v. MID India Power and Steel Ltd., (2012) 11 SCC 458

Supreme Court has held that agreement to sell creates jus inpersonam while sale creates jus in rem.

• CIT v. Hind Construction Ltd., (1972) 4 SCC 460

A person cannot sell his goods to himself. Supreme Court held that sale contemplates a seller and a purchaser. If a person revalues his goods and shows a higher value in books of account he cannot be considered as having sold the goods.

• H. Anraj v. Govt. of Tamil Nadu, (1986) 1 SCC 414

Supreme Court held that lottery tickets are also ‘Goods’.

• M.S. Madhusoodhanan v. Kerala Kanumudi (P) Ltd. (2004) 9 SCC 204

Supreme Court held that transfer of goods may be made with immediate effect and the consideration may be agreed upon at a later date. The Court also observed that the agreement which allows the party to fix the price at a later date is not invalid for uncertainty under Section 29 of the Contract act.

• Baldry v. Marshall, (1925) 1 KB 260 (CA)

The plaintiff wanted to buy car for touring purpose. The defendant suggested that ‘Bugatti’ car would be suitable and therefore, plaintiff bought one. The car turned out to be unfit for touring purpose. The plaintiff sought to reject the sale. The court held that suitability of car for touring purpose was not a ‘warranty’ but instead it was a ‘condition’.

• Grant v. Australian Knitting Mills, AIR 1936 PC 34

The court held that buyer’s reliance on seller need not be express every time. When the seller deals with particular goods the buyer has the confidence that tradesman has selected his stock with skill and judgment.

• Salar Jung Sugar Mills Ltd. v. State of Mysore, (1972) 1 SCC 23

Unascertained goods are not defined in the Act. Supreme Court held that unascertained goods fall in the following categories:

1. Goods to be manufactured or grown by the seller;

2. Generic goods;

3. Unidentified part of specific goods

• McEntire v. Crossiey Bros. Ltd. 1895 AC 457 (HL)

Passing of property is one of the results of sale of goods. However, the time of passing of property depends on the intention of the parties. This question entirely depends on the intention of the parties.

• Agricultural Market Committee v. Shalimar Chemical Works Ltd., (1997) 5 SCC 516

Supreme Court held that if the requirements of Section 20 are met then the title in goods passes to the purchaser. The passing of title is not dependent on payment of price on time of delivery of the goods.

• Bishopsgate Motor Finance Corpn. Ltd. v. Transport Brakes Ltd., (1949) 1 KB 322 (CA)

The court laid down following two principles:

1. No one can give a better title than he himself has;

2. The person who takes in good faith for value withoutnotice should get a good title.

• Morgan Stanley Mutual Fund v. Kartik Das, (1994) 5 SCC 225

Till the allotment of shares take place, shares cannot be called ‘goods’ because they do not exist.

• Badri Prasad v. State of Madhya Pradesh, AIR 1970 SC 706

Definition of ‘Goods’ under Section 2(7) makes it clear that things fixed to the land may be subject matter of contract of sale of goods provided that by the terms of contract they are agreed to be severed from land.

• State of Madras v. Gannon Dunkerley& Co. (Madras) Ltd., 1959 SCR 379

‘Sale’ in legal sense is one arising out of contract leading to passing of the ownership.

• Consolidated Coffee Ltd. v. Coffee Board, Bangalore, AIR 1980 SC 1468

In case of sale by auction, the sale is complete when auctioneer announces its completion by the fall of hammer or in other customary manner.

• M.S. Madhusoodan v. Kerala KaumudiPvt. Ltd., AIR 2004 SC 909

An agreement which provides for future fixation of prices either by the parties themselves or by the third party is capable of being made certain and is not invalid as per Section 29 of the Contract Act.