Sale and agreement to sell-Definition or Essentials

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There is little difference between agreement to sell and sale. A sale is when one person transfers ownership of certain goods and then simultaneously delivers the goods (or both) to another person. In the response, the person to whom goods are transferred pays consideration to the owner. After the sale, we will discuss the agreement to be sold.

A contract of sale can have two parties.


One who sells his products.

  • Buyer:
  • The person to whom the goods are being sold (or).
  • The person who buys the goods.
  • Relevant Provisions:
  • Sections 4 and 5 of The Sale of Goods Act (1930).
  • The meaning of sale:
  • Literally, sale is “an act or procedure of selling something”.

Definition of sale:

Section 4(1) of the Sale of Goods Act 1930:

“Sale” is an agreement in which the seller gives or agrees that he will transfer the property in goods to the buyer at a fixed price.

Prof. Wilston:

“Sale” is an agreement in which the seller gives or agrees that he will transfer the property in goods to the buyer at a fixed price.

  • Essentials on Sale
  • There are some essential elements to a sale.
  • Bilateral
  • Consent is free
  • Transfer of property
  • Consideration or price (money)
  • Goods

1). Bilateral:

The contract for the sale transaction shall be bilateral.

2). No cost consent:

Free consent must exist, i.e. Both parties must consent.

3). Transfer of property:

It is crucial that property be transferred on the spot in order to create a valid contract for sale.

4). 4.) Price (money) or Consideration

The buyer must pay the seller a pre-arranged consideration in order to complete the sale transaction.

5). Goods:

Section 2(7) of the sale of Goods Act (1930) defines “goods” as any kind of movable property that is not subject to actionable claims or money. It includes electricity, water and gas, stock, shares, stocks, and shares. Also, it includes growing crops, grass and other things that are attached to the land or made part of the land and which have been agreed to be serviced prior to sale or under the contract.

Sale Agreement:

An agreement to sell is essentially a transaction in which both parties agree to perform their respective parts and to fulfill their remaining liabilities at a future date. The parties to an agreement for sale agree to do their entire part in the future.

According to section 4(4) of the sale of Goods Act (1930):

An agreement to sell is made when the specified time has passed or conditions have been met.

There is a difference between a sale and an agreement to sell

1). Nature of the Contract

A sale is an executed contract that has no remaining provisions. An agreement to sell is an executory document in which ownership rights are not yet transferred.

2). Loss-Risk:

If the goods are damaged during a sale, the buyer is liable even if he doesn’t have actual possession.

The seller is not liable for any loss incurred by him in an agreement to sell, even though the goods are still in his possession at the time of loss.

3). Delivery of goods:

The goods will be delivered at the place of sale. The goods must be delivered within the agreed time frame, even if the seller has already agreed to sell them.

4). Ownership:

The buyer receives ownership immediately upon the sale. If you have an agreement to sell, ownership is transferred later.

5). Insolvency of the seller:

The buyer can either recover the price or recover the goods if the seller is adjudicated to be insolvent. The buyer can’t get the price but can sue for damages in an agreement to sell.

6). Breach of contract

If the seller refuses to fulfill his obligation, the buyer can file a suit seeking specific performance. The buyer cannot claim damages if the seller violates an agreement to sell.

7). Right of Resale

The seller can’t resell goods after a sale; however, he may be sued for damages. If the seller sells goods under an agreement to sell, he cannot be sued for breach.

8). Title:

The title deeds will be handed over immediately upon the sale. Contrary to the agreement to sell, title deeds will be handed over in the future.


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