SALE OF GOODS ACT, 1930

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SALE OF GOODS ACT, 1930 
(III of 1930) 
CONTENTS 
1. Short title, extent and commencement 
2. Definitions 
3. Application of provisions of Act of 1872 
4. Sale and agreement to sell 
5. Contract of sale how made 
6. Existing or future goods 
7. Goods perishing before making of contract 
8. Goods perishing before sale but after agreement to sell 
9. Ascertainment of price 
10. Agreement to sell at valuation 
11. Stipulation as to time 
12. Condition and warranty 
13. When condition to be treated as warranty 
14. Implied undertaking, as to title, etc. 
15. The words and comma   
16. Sale by description 
16-A. Seller to inform buyer to defect in goods sold 
17. Implied conditions as to quality or fitness 
18. Sale by sample 
19. Goods must be ascertained 
20. Property passes when intended to pass 
21. Specific goods in a deliverable state 
22. Specific goods to be put into a deliverable state 
23. Specific goods in a deliverable state, when the seller has to do  anything 
thereto in order to ascertain price 
24. Sale of unascertained goods and appropriation. 
25. Goods sent on approval or "on sale or return". 
26. Reservation of right of disposal. 
27. Risk prima facie passes with property. 
28. Sale by person not the owner 
29. Sale by one of joint owners 
30. Sale by person in possession under voidable contact. 
31. Seller or buyer in possession after sale. 
32. Duties of seller and buyer 
33. Payment and delivery are concurrent conditions. 
34. Delivery. 
35. Effect of part delivery. 
36. Buyer to apply for delivery 
37. Rules as to delivery. 
38. Delivery of wrong quantity. 
39. Instalment delivers. 
40. Delivery to carrier or wharfinger. 
41. Risk where goods are delivered at distant place. 
42. Buyer's right of examining the goods. 
43. Acceptance. 
44. Buyer not bound to return rejected goods. 
45. Liability of buyer for neglecting or refusing delivery of goods. 
46. "Unpaid seller" defined. 
47. Unpaid seller's rights. 
48. Seller's lien. 
49. Part delivery. 
50. Termination of lien. 
51. Right of stoppage in transit. 
52. Duration of transit. 
53. How stoppage in transit is effected. 
54. Effect of sub-sale or pledge by buyer. 
55. Sale not generally rescinded by lien or stoppage in transit. 
56. Suit of price. 
57. Damages for non-acceptance. 
58. Damages for non-delivery. 
59. Specific performance. 
60. Remedy for breach of warranty. 
61. Repudiation or contract before due data 
62. Interest by way of damages and special damages. 
63. Exclusion of implied terms and conditions. 
64. Reasonable time a question of fact. 
64-A. In contracts of sale amount of increased or  decreased duty to be added 
or deducted 
65. Auction sale. 
66. Repeal. 
67. Savings. 
68. Mode of giving public notice. 
69. Repeals 
70. Savings 
TEXT 
1
SALE OF GOODS ACT, 1930  
(III of 1930) 
[5th 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 
2
*** 
Sale of Goods Act, 1930. 
3
[(2) It extends to the whole of Pakistan.] 
(3) It shall come into force into force on the first 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; 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; 
(3) "document of title to goods" includes a bill of lading, dock- warrant, 
warehouse keeper's certificate, wharfingers' certificate, railway receipt, 
warrant or order for the delivery of goods and any other document used 
in 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; 
(4) "fault" means wrongful act or default; 
(5) "future goods" means goods to be manufactured or produced or 
acquired by the seller after the making of the contract of sale; 
(6) "goods" means every kind of movable property other than actionable 
                                                 
1For Statement of Objects and Reasons and for Report of Special  Committee. See Gazette of India, 1929 Pt. V.p. 163: for 
Report of Select  Committed, see ibid., 1930, Pt. V. p.1. This Act has been applied to Phulera in the Excluded A rea of Upper 
Tanawal to the extent the Act is  applicable in the N.W.F.P. subject to certain modifications, and also  extended to the Excluded 
Area of Upper Tanawal (N.-W.F.P.) other than Phulera with effect from such date and subject to such  modifications as may be 
notified, see N. -W.F.P. (Upper Tanawal)  (Excluded Area) Laws Regulations, 1950. It has also been extended to the Leased 
Areas of Balochistan, see the Leased Areas of Balochistan, see Gazette of India, 1937, Pt. I. p. 1499. 
2The word "Indian" omitted by the Federal Laws (Revision and Declaration) Act, 1951 (26 of 1951), S.3. and Second Schedule. 
3Subs. by the Central Laws (Statute Reforms) Ordinance, 1960 (21 of 1960).S.3.and Second Schedule. (with effect from the 
14th October, 1955), for subsection (2) which was amended by the A.O., 1949 and Act 26 of 1951. 
claims and money; and includes 
4
[electricity, water, gas,] 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; 
(7) 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 and act of insolvency or not; 
(8) "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; 
(9) "price" means the money consideration for a sale of goods; 
(10) "property" means the general property in goods, and not merely a 
special property; 
(11) "quality of goods" includes their state or condition; 
(12) "Seller" means a person who sells or agrees to sell goods; 
(13) "specific goods" means goods identified and agreed upon at the time a 
contract of sale is made; and 
(14) expressions used but not defined in this act and defined in the Contract 
Act, 1872 (IX of 1872), have the meanings assigned to them in that 
Act. 
3. Application of provisions of Act of 1872.– The unrepealed provisions of the 
Contract Act, 1872 (IX of 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 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 in agreement to sell. 
(3) 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 
                                                 
4Ins. by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S, 2 with effect from the 7th June, 1962) 
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 
party 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 have been delivered to and 
appropriated by the buyer, he shall pay a reasonable price thereof. 
(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 Warranties 
11. Stipulation as to time.– Unless a different intention appears from the terms 
of the contract, stipulations as to time of payment are 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 of 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 contact as repudiated. 
(3) A warranty is a stipulation collateral to the main purpose of the 
contract, the breach of which gives rise to claim for damages but not to a right to 
reject the goods and treat the contract as repudiated. 
(4) Whether a stipulation in contract of sale is a condition or a warranty 
depends in each cease 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 are part thereof 
5
*** 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 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; 
15. The words and comma.– "or where the contract is for specific goods the 
property in which has passed to the buyer," 
(a) an implied warranty that the buyer shall have and enjoy quiet 
possession of the goods; 
(b) 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. 
16. 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. 
                                                 
5Omitted by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S.3 (with effect from the 7th June, 1962). 
6
[16-A. Seller to inform buyer to defect in goods  sold.–Notwithstanding anything 
contained in section 16, and save where the parties have  entered into a agreement 
to the cont rary, the seller  shall be under an obligation to inform the buyer of  any 
defect in the goods sold at the time of the contract, except in a case where the defect 
the defect is obviously known to the buyer.] 
17. 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, thee 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 products or not), 
there is an implied condition that the goods shall be reasonably fit for 
such purposes: 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.  
18. 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– 
• That the bulk shall correspond with the sample inquality; 
• that the buyer shall have a reasonable opportunity of comparing the 
bulk with the sample; 
• 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 
                                                 
6S.16-A, inserted by Sale of Goods (Amendment) Act (XVIII of 1994), S.2 with effect from 23-10-1994. 
19. 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. 
20. 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 in to the 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 circumstance 
of the case. 
(3) Unless a different intention appears, the rules contained in section 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. 
21. 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. 
22. 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 of 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. 
23. 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. 
24. 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 be given either before or after the 
appropriation is made. 
(2) Delivery to carrier.– Where, in pursuance of the contract, the seller 
delivers the goods to the buyer or to a carrier to other bailee (whether named by the 
buyer or not) for the purpose of transmission to the buyer, and does not reserve the 
right to disposal, he is deemed to have unconditionally appropriated the goods to the 
contract. 
25. Goods sent on approval or "on sale or return".– When goods are 
delivered to the buyer on approval or "on sale or return" of 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 does without giving 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. 
26. 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, be 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 imposed by the seller are fulfilled.  
 
7
[(2) Where goods are shipped or are dispatched by railway and are by the 
bill of lading or by railway receipt 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 the bill of exchange and 
8
[bill of landing or railway receipt] to the buyer 
together, to secure acceptance or payment of the bill of exchange, the buyer is 
bound to return the 
9
[bill of lading or railway receipt] if he does not honour the bill of 
exchange and if he wrongfully retains the 
10
[bill of lading or railway receipt] the 
property in the goods does not pass to him. 
27. 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, 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 
28. 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 sole 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 
                                                 
7Subs. by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S.4 (with effect from the 7th June 1962), for  the 
original subsection (2). 
8Subs. by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S.4 with effect from the 7th June, 1962), for  "bill of 
lading" 
9Subs. by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S.4 (with effect from the 7th Ju ne, 1962), for "bill of 
lading". 
10Subs. by the Sale of Goods (Amendment) Ordinance, 1962 (47 of 1962), S.4 (with effect from the 7th June, 1962), for  "bill of 
lading". 
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 goods faith and has not at the time of the 
contract of sale notice that the seller has not authority to sell. 
29. Sale by one of joint owners.– If one of several joint owners of goods has the 
sole possession of the 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. 
30. Sale by person in possession under voidable contact.– When the seller of 
goods has obtained possession thereof under a contract voidable under section 19 
or section 19-A of the Contract Act, 1872, but the contract has not been rescinded at 
the time of the sale, the buyer acquires a goods title to the goods, provided he buys 
them in goods faith and without notice of the seller's defect of title. 
31. 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 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 effects as if such lien or 
right did not exist. 
CHAPTER IV 
PERFORMANCE OF THE CONTRACT 
32. Duties of seller and buyer.– It is duty of the seller to deliver the goods of the 
buyer to accept and pay for them, in accordance with the terms of the contract of 
sale. 
33. 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 wiling 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. 
34. 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. 
35. Effect of part delivery.– A delivery of party 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. 
36. Buyer to apply for delivery.– Apart from any express contract, the seller of 
goods is not bound to deliver them until the buyer applies for delivery. 
37. 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 them 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. 
38. 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 if 
the buyer accept 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 
11
[if the goods delivered are such that it is difficult or time 
consuming to separate the quantity contracted for,] he may reject the whole. If the 
buyer accept 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. 
39. Instalment delivers.– (1) Unless otherwise agreed, the buyer of goods is not 
bound to accept delivery thereof by instalments. 
                                                 
11Inserted by Sale of Goods (Amendment) Act (XVIII of 1994), S.3 w.e.f. 23-10-1994. 
(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 reduces 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. 
40. 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 sale custody, is 
a prima facie deemed to be 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 circumstances in which it is usual to insure, 
the seller shall 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. 
41. 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 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. 
42. 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 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. 
43. 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. 
44. 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. 
45. 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 
RIGHT OF UNPAID SELLER AGAINST THE GOODS 
46. "Unpaid seller" defined.– (1) The seller of goods is deemed to be an "unpaid 
seller" within the meaning of this Act– 
(1) when the whole of the price has not been paid or tendered; 
(2) 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 dishonor of the 
instrument or otherwise. 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 landing has been endorsed, or a 
consignor or agent who has himself paid, or is directly responsible for, 
the price. 
47. Unpaid seller's rights.– (1) Subject to the provisions of the 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 implications of 
law– 
(1) a lien on the goods for the price while he is in possession of them; 
(2) in case of the insolvency of the buyer a right of stopping the transit he 
parted. a right of re-sale as limited by this Act. 
(3) 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 
48. 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:– 
(1) where the goods have been sold without any stipulation as to credit; 
(2) where the goods have been sold on credit, but the term of has expired; 
where the buyer becomes insolvent. 
(3) The seller may exercise his right of lien notwithstanding that he is in 
possession of the goods as agent or bailee for the buyer. 
49. 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 circumstance as to show an agreement to waive the lien. 
50. Termination of lien.– (1) The unpaid seller of goods loses his lien thereon– 
(1) 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; 
(2) when the buyer or his agent lawfully obtains possession of the goods; 
by waiver thereof. 
(3) 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 
51. 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 the payment or tender of the price. 
52. 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 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. 
53. How stoppage in transit is effected.– (1) The unpaid seller may 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 of 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 later 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 
54. 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 documents to a person who takes the documents in good faith 
and for consideration, then, if such last mentioned transfer was by way of 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 in 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 pledge 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. 
55. Sale not generally rescinded by lien or stoppage in transit.– (1) Subject to 
the provision 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 in 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 
56. Suit of 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 
price, 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. 
57. 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. 
58. 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. 
59. Specific performance.– Subject to the provisions of Chapter II of the Specific 
Relief Act, 1877, in any suit for breach of contract to deliver specific or ascertained 
goods, the Court may, if it thinks fit, on the applications 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. 
60. Remedy for breach of warranty.– (1) Where there is a breach of warranty by 
the 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 or such breach of warranty entitled to reject the goods; but he may– 
(1) set up against the seller the breach of warranty in diminution or 
extinction of the price; or 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. 
61. Repudiation or contract before due data.– 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. 
62. 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 contact to the contract, 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 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 
63. 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. 
64. 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. 
12
[64-A. In contracts of sale amount of increased or  decreased duty to be 
added or deducted.– In the event of  any duty of customs or excise 
13
[or tax] on any 
goods being imposed, increased, decreased or remitted after the making of any 
contract for the sale of such goods without stipulation 
14
[as to the payment of duty or 
tax where duty or tax] was not chargeable at the time of the making of the contract, 
or for the sale of such goo ds 
15
[duty paid  or tax paid where duty or tax] was 
chargeable at that time,– 
(a) if such imposition or increase so takes effect that 
16
[the duty or 
tax or increased duty or tax] as the case may be, or any part 
thereof, is paid, the seller may add so much to the contract price 
as will be equivalent to the amount paid 
17
[in respect of such duty 
or tax or increase of duty or 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 de creased 
duty 
18
[or tax] only or no duty 
19
[or tax], as the case may be, is 
paid, the buyer may deduct so much from the contract price as 
will be equivalent to the decrease of duty 
20
[or tax] or remitted 
duty 
21
[or tax], and he shall not be liable to pay, or be  sued for or 
in respect of, such deduction.]  
                                                 
12S.64-A ins. by the Indian Sale of Goods (Amendment) Act, 1940 (41 of 1940), S.2. 
13Ins. by the Sale of Goods (Amdt.) Act, 1956 (5 of 1956), S.2 (with effect from the 11th April, 1956). 
14Subs. ibid. (with effect from the 11th April, 1956) for "as to the payment of duty where duty". 
15Subs. by the Sale of Goods (Amendment) Act, 1956), (with effect from the 11th April, 1956), for "duty paid where duty". 
16Subs. by the Sale of Goods (Amendment) Act, 1956 (5 of 1956) (with effect from the 11th April, 1956), for "the du ty or 
increased duty". 
17Subs. by the Sale of Goods (Amendment) Act, 1956 (5 of 1956), (with effect from the 11th April, 1956), for "in respect of such 
duty or increase of duty". 
18Ins. ibid. (with effect for the 11th April, 1956). 
19Ins. ibid. (with effect for the 11th April, 1956). 
20Ins. ibid. (with effect for the 11th April, 1956). 
21Ins. ibid. (with effect for the 11th April, 1956). 
22
[Explanation.– The word "tax" in this section means the tax payable under the 
Sales Tax Act, 1951]. 
65. Auction sale.– In the case of a sale by auction 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 fail 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 expressly 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 parson 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.  
66. [Repeal].– Rep. by the Repealing Act, 1938 (I of 1938), S.2. and Schedule. 
67. 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 anything done commencement, 
(c) any enactment relating to the sale of goods which is not  expressly 
repealed by this Act, or 
(d) any rule of law not inconsistent with this Act. 
(2) The rules of insolvency 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. 
(e) regulating the procedure of the Registrar when disputes arise; 
(f) regulating the filing of documents received by the Registrar; 
(g) prescribing conditions for the inspection of original documents; 
(h) regulating the grant of copies; 
(i) regulating the elimination of registers and documents; 
                                                 
22Explanation added ibid. (with effect from the 11th April, 1956). entries relating to firms are to be made therein, and the mode in 
which such entries are to be amended or notes made therein. 
(j) providing for the maintenance and form of an index to the Register of 
Firms; and 
(k) generally, to carry out the purposes of this Chapter. 
(3) All rules made under this section shall be subject to the conditions of 
previous publications: 
Provided further that the fees payable for any service desired on the same 
day on which an application for the same is made may be double the aforesaid 
maximum fees. 
CHAPTER VIII SUPPLEMENTAL 
68. Mode of giving public notice.– A public notice under this Act is given– 
(a) where it relates to the retirement or expulsion of a partner from a 
registered firm, or to the dissolution of a registered firm, or to the 
election to become or not to become a partner in a registered firm by a 
person attaining majority who was admitted as a minor to the benefits 
of partnership, by notice to the Registrar of Firms under section 63, and 
by publication in the 
23
[official Gazette] and in at least one vernacular 
newspaper circulating in the district where the firm to which in relates 
has its place or principal place of business, and 
(b) in any other case, by publication in the 
24
[official Gazette] and in at least 
one vernacular newspaper circulating in the district where the firm to 
which it relates has its place or principal place of business. 
69. [Repeals.].– Rep. by the Repealing Act, 1938 (I of 1938), S.2 and Schedule. 
(a) Proviso added by Partnership (Amendment) Ordinance (XIX of 1981), 
dated 18-5-1981 
70. Savings.– Nothing in this Act or any repeal effected thereby shall affect or be 
deemed to effect– 
(a) any right, title, interest, obligation or liability already acquired, accrued 
or incurred before the commencement of this Act, or 
(b) any legal proceeding or remedy in respect of any such right, title, 
interest, obligation or liability, or anything done or suffered before the 
commencement of this Act, or 
(c) anything done or suffered before the commencement of this Act, or 
(d) any enactment relating to partnership not expressly repealed by this 
Act, or 
(e) any rule of insolvency relating to partnership, or 
(f) any rule of law not inconsistent with this Act.  
                                                 
23Substituted by A.O., 1937, for "local official Gazette". 
24Substituted by A.O., 1937, for "local official Gazette". 
21
[SCHEDULE I]  
MAXIMUM FEES 
[See subsection (1) of 71] 
Document or act in respect of which the fee is payable Maximum Fees 
 Rs Statement under section 58 50 
Statement under section 60 20 
Intimation under section 61 20 
Intimation under section 62 20 
Notice under section 63 20 
Application under section 64 20 
Inspection of the Register of Firms under subsection (1) 
of section 66 
 
5 Inspection of documents relating to a firm under 
subsection (2) of section 66 or any other document in the 
custody of the Registrar of Firms 
 
5 
Copies from the Register of Firms Rs.2 for each 100 
words or part 
thereof.]  
SCHEDULE II.–[ENACTMENTS REPEALED]. 
Rep. by the Repealing Act, 1938 (1 of 1938), section 2 and Schedule.