Business Laws · The Sale of Goods Act, 1930

Goods and Their Classification under the Sale of Goods Act, 1930

Updated 4 October 2026

Goods under the Sale of Goods Act are classified as existing, future or contingent, and as specific, ascertained or unascertained. To answer, first check who owns the goods when the contract is made, then whether they are identified. Sections 7 and 8 add that if specific goods perish, the contract is void or the agreement to sell is avoided.

Understand Goods and Their Classification

A contract of sale is about goods. The Act does not treat all goods alike, because the type of goods decides when ownership passes and what happens if the goods are lost. So you must be able to label the goods in any fact pattern.

There are two ways to classify. The first is by time of ownership. Section 6 says goods may be existing goods, which the seller owns or possesses at the time of the contract, or future goods. Future goods are goods the seller will manufacture, produce or acquire after making the contract. Section 6(2) adds a special case: a contract for goods whose acquisition by the seller depends on a contingency that may or may not happen. These are called contingent goods. Under Section 6(3), if the seller purports to make a present sale of future goods, it operates only as an agreement to sell.

The second way is by identification. Specific goods are identified and agreed upon when the contract is made, such as 'this particular scooter'. Unascertained goods are only described by kind or quantity, such as '50 kg of rice from the godown'. Ascertained goods start as unascertained goods and are later identified after the contract is made. Under Section 18, no property passes in unascertained goods until they are ascertained. Under Section 23, property passes when goods of that description, in a deliverable state, are unconditionally appropriated to the contract with the assent of the other party.

Now the effect of perishing. Section 7 deals with specific goods that have already perished or been damaged at the time the contract is made, without the seller's knowledge. The contract is void. Section 8 deals with an agreement to sell specific goods that perish later, without fault of seller or buyer, before the risk passes to the buyer. The agreement is avoided. Both sections work only for specific goods.

Key rules to remember

Existing goods: Goods owned or possessed by the seller at the time of the contract (Section 6(1)); Includes goods in the seller's possession even if he is not the owner.
Future goods: Goods to be made, produced or acquired by the seller after making the contract; A present sale of future goods operates only as an agreement to sell (Section 6(3)).
Contingent goods: Goods whose acquisition by the seller depends on a contingency that may or may not happen (Section 6(2)); A kind of future goods. Check for words like 'if', 'provided', 'subject to'.
Specific vs unascertained goods: Specific = identified and agreed at contract. Unascertained = described only by kind or quantity.; Ascertained goods are those identified after the contract is made.
Property in unascertained goods: No property passes until the goods are ascertained (Section 18); Section 23: property passes on unconditional appropriation of goods in a deliverable state, with assent.
Section 7: goods already perished: Specific goods perished at time of contract, seller unaware → contract void; Needs both 'specific goods' and 'without the knowledge of the seller'.
Section 8: goods perish after agreement: Agreement to sell specific goods + goods perish without fault of either party + risk not yet passed → agreement avoided; All three conditions must be met.

How to solve Goods and Their Classification questions

Use this order for any question on classification or perishing. It keeps your answer in provision, facts and conclusion form.

1Underline the goods in the facts and note whether the seller owned or possessed them when the contract was made.
2Label them as existing, future or contingent. Look for 'will manufacture', 'will harvest' or 'if the ship arrives'.
3Check identification: is it 'this' item (specific) or a description by kind or quantity (unascertained)? Note if any later identification happened (ascertained).
4If the goods were lost or damaged, mark when it happened: before the contract or after the agreement.
5Apply Section 7 if the loss was before the contract and the seller did not know. Apply Section 8 if it was after the agreement, without fault of either party, and before risk passed.
6If goods are unascertained or the seller was at fault, state that Sections 7 and 8 do not help and the seller may be liable for breach.
7Write the conclusion in one line: type of goods, section applied, and the legal result (void, avoided, or breach).

Quickest way: Two-question shortcut

When to use it: Use it when time is short, especially for short-answer or case-based parts.

Ask 1: Did the seller have the goods at the contract date? If yes, existing. If no, future. If it depends on an uncertain event, contingent.
Ask 2: Were the goods pointed out at the contract date? If yes, specific. If only described, unascertained.
For loss, ask 'when' and 'whose fault'. Already perished when the contract was made and seller unaware: Section 7, void. After the agreement and no fault: Section 8, avoided.
Write the section number, one line of facts and the result. That gets the marks.

Common mistakes in Goods and Their Classification

Applying Sections 7 and 8 to unascertained goods such as '100 bags of wheat'.
Students remember 'perishing of goods' and forget these sections speak only of specific goods.
Fix: Check the word 'specific' first. If the goods are only described by kind, the seller must still deliver and may be liable if he does not.
Treating future goods and contingent goods as the same thing.
Both relate to the seller not having the goods yet.
Fix: Future goods are goods the seller does not yet own or possess at the contract date. Contingent goods are future goods whose acquisition depends on a contingency that may or may not happen (Section 6(2)). Look for a condition.
Saying Section 8 applies even when the seller was careless.
Students focus on the loss and skip the words 'without any fault on the part of the seller or buyer'.
Fix: Always state whether there was fault. If the seller was at fault, Section 8 does not avoid the agreement and he may be liable.
Calling a present sale of future goods a valid sale.
The word 'sale' in the facts is taken at face value.
Fix: Under Section 6(3), it operates only as an agreement to sell. Ownership passes later.
Using Section 7 when goods perish after the contract, or Section 8 when goods perished before it.
Students mix up the two sections.
Fix: Use timing. Section 7 applies where the goods have already perished or been damaged at the time the contract is made, without the seller's knowledge (contract void). Section 8 is loss after the agreement to sell and before risk passes (agreement avoided).
Confusing specific goods with ascertained goods.
Both mean identified goods.
Fix: Specific goods are identified at the time of the contract. Ascertained goods are identified afterwards.

Worked examples

Example 1

Classify the goods in each case. (a) Ravi agrees to sell his own laptop, which is lying in his house. (b) Meena, a baker, agrees to sell 200 cakes that she will bake next week. (c) Karan agrees to sell 50 bags of cement out of a larger lot in his godown, without choosing the bags. (d) Sunil agrees to sell goods that he will acquire only if his import consignment clears customs.

Show the solution

(a) Ravi owns the laptop at the time of the contract, so it is existing goods. It is also identified, so it is specific goods.
(b) Meena does not yet have the cakes. She will make them after the contract, so they are future goods.
(c) Karan owns the lot, so the goods are existing. The 50 bags have not been picked out, so they are unascertained goods. Under Section 18, no property passes until they are ascertained.
(d) Sunil's acquisition depends on customs clearance, which may or may not happen. Under Section 6(2) these are contingent goods, a kind of future goods.

Answer: (a) Existing and specific goods. (b) Future goods. (c) Existing but unascertained goods. (d) Contingent goods under Section 6(2).

Example 2

On 1 March, Anil agrees to sell to Bhavna a particular second-hand car, which is in his garage. Unknown to Anil, the car was destroyed in a fire on the night of 28 February. Would your answer change if, instead, the contract said the car would be handed over and ownership would pass on 10 March after Anil repaired it, and the car was destroyed by a fire on 5 March, without fault of either party, before the risk passed to Bhavna?

Show the solution

The car is a particular car, so these are specific goods. Sections 7 and 8 can apply.
Case 1: the car was already destroyed on 28 February, so it had perished at the time the contract was made on 1 March, and Anil did not know. Under Section 7, the contract is void.
Case 2: ownership is to pass later, on 10 March after Anil repairs the car. Because the transfer of property is to take place at a future time, this is an agreement to sell (Section 4(3)). Under Section 21, where the seller must do something to put specific goods into a deliverable state, property does not pass until it is done and the buyer has notice.
The fire on 5 March comes after the agreement, is without fault of either party, and the risk has not passed to Bhavna. Section 8 applies and the agreement is thereby avoided.
Note the contrast: if it were an unconditional contract for a car already in a deliverable state, property would pass when the contract is made (Section 20). It would then be a sale, not an agreement to sell, and Section 8 would not apply. The loss would then generally fall on the buyer, since risk follows property unless the parties agree otherwise. The risk rule is not in the sections quoted here, so state it in words.

Answer: Case 1: the contract is void under Section 7. Case 2: it is an agreement to sell, and the agreement is avoided under Section 8, so neither party is liable for non-delivery on these facts. If the contract were an unconditional sale of a deliverable car, property would pass at once under Section 20 and Section 8 would not apply.

Exam tips

Write the section number and the exact condition, such as 'specific goods' and 'without the knowledge of the seller', before applying it to the facts.
In case studies, label the goods first. A one-line classification often earns separate marks.
Use the pattern: provision, facts, conclusion. Keep each part to one or two lines.
For 'distinguish between' questions, use two columns in your own words: existing vs future goods, specific vs unascertained goods, Section 7 vs Section 8.
Always check for seller's fault or knowledge in perishing questions. These words decide the answer.

Practice questions from The Sale of Goods Act, 1930

Goods and Their Classification: frequently asked questions

What is the difference between existing goods and future goods?

Existing goods are owned or possessed by the seller when the contract is made. Future goods are goods the seller will make, produce or acquire after the contract. A present sale of future goods operates only as an agreement to sell under Section 6(3).

What is the difference between specific goods and ascertained goods?

Specific goods are identified and agreed upon at the time the contract is made. Ascertained goods start as unascertained and are identified after the contract. Both can pass property once the other conditions are met.

What is the difference between Section 7 and Section 8 of the Sale of Goods Act?

Section 7 covers specific goods that had already perished or been damaged at the time of the contract, without the seller's knowledge, and the contract is void. Section 8 covers an agreement to sell specific goods that perish afterwards, without fault of either party and before the risk passes. The agreement is then avoided.

Do Sections 7 and 8 apply to unascertained goods?

No. Both sections speak only of specific goods. If the goods are only described by kind or quantity, the seller must still supply them and may be liable for breach if he cannot.