Fundamentals of Business Laws and Business Communication · Sale of Goods Act, 1930

Goods and Their Classification under the Sale of Goods Act

Updated 10 October 2026 · Fact-checked

Under the Sale of Goods Act, 1930, goods mean every kind of movable property except actionable claims and money. They are classified as existing (owned or possessed by the seller), future (to be made or acquired), and contingent (depends on an event). Goods are also specific, ascertained or unascertained. Identify the type from the wording of the question.

Understand Goods and Their Classification

A contract of sale is about goods. So the Act first defines goods. In simple words, goods are every kind of movable property other than actionable claims and money. Stock and shares, growing crops, grass, and things attached to or forming part of land that are agreed to be severed before sale or under the contract of sale are also goods. Land and a building are not goods. A debt or a right to claim is an actionable claim, so it is not goods. Money as currency is not goods.

The Act classifies goods in two ways. The first way is by time of ownership: existing goods and future goods, plus contingent goods as a kind of future goods. The second way is by identification: specific, ascertained and unascertained goods.

Existing goods are goods owned or possessed by the seller at the time of the contract. They may be specific or unascertained, and they may be in the seller's stock. Future goods are goods to be manufactured, produced or acquired by the seller after the contract is made. For example, a farmer agrees to sell next season's wheat crop. Section 6 deals with these and also covers contingent goods: goods whose acquisition by the seller depends on a contingency that may or may not happen. Example: a trader agrees to sell goods he will get only if his ship arrives. A contract for the sale of contingent goods is a type of contract of sale of future goods.

The second classification is about whether the exact goods are identified. The Act defines specific goods (Section 2(14)) as goods identified and agreed upon at the time the contract of sale is made, such as 'this Bajaj scooter, number plate MH-12-1234'. The Act does not define ascertained goods. In case law and commentary, the term describes goods that become identified after the contract is made, such as 10 bags picked out of a godown for a buyer. Unascertained goods are goods defined only by description or sample, or as part of a bulk, such as '50 kg of rice from the lot' or 'any 10 bags of cement'. They are not identified yet.

Why does this matter? Property in unascertained goods cannot pass to the buyer until the goods are ascertained. Also, under Section 6(3), a purported present sale of future goods operates as an agreement to sell. And if specific goods perish before the contract is made without the seller's knowledge, the contract is void under Section 7. If specific goods, after an agreement to sell, perish or become so damaged without fault of the seller or buyer before the risk passes to the buyer, the agreement becomes void under Section 8.

Key formulas to remember

Meaning of goods: Goods = every kind of movable property − actionable claims − money; Includes stock and shares, growing crops, grass and things attached to land to be severed before sale or under the contract.
Existing goods: Owned or possessed by the seller at the time of contract; Can be specific or unascertained.
Future goods: Goods to be manufactured, produced or acquired by the seller after making the contract; A purported present sale of future goods operates as an agreement to sell (Section 6(3)).
Contingent goods: Goods whose acquisition by the seller depends on a contingency (Section 6(2)); Treated as future goods. The contract is subject to the contingency.
Specific goods: Identified and agreed upon at the time the contract of sale is made; Example: this particular car.
Unascertained goods: Defined by description or sample, or part of a larger bulk, not yet identified; Become ascertained when identified after the contract.
Perishing of goods (Sections 7 and 8): Section 7: specific goods perished before contract, seller unaware: contract void. Section 8: specific goods perish or become so damaged after agreement to sell, before the risk passes to the buyer, no fault of seller or buyer: agreement void; Both apply to specific goods only.

How to solve Goods and Their Classification questions

Use this method for any question on classification of goods. Read the facts, then test them one by one.

1Check whether the item is movable property. If it is land, money or an actionable claim, it is not goods.
2Ask who owns or possesses the item at the time of contract. If the seller does, it is existing goods.
3If the seller will make, produce or acquire it later, it is future goods. If it depends on an uncertain event, it is contingent goods.
4Ask whether the exact item is identified in the contract. If yes, it is specific goods.
5If the goods are described only by type, quantity or as part of a bulk, they are unascertained. If identified later, they become ascertained.
6If the question mentions destruction of goods, check the timing and whether the goods were specific. Section 7 applies if they perished before the contract. Section 8 applies if they perished after the agreement to sell but before the risk passes to the buyer, without fault of either party.
7Match your finding to the option that states it exactly, and rule out options that mix up the terms.

Quickest way: Three-question shortcut

When to use it: Use it for one-line MCQs that ask you to name the type of goods or the effect of the sale.

Question 1: Does the seller own it now? Yes means existing goods. No means future goods.
Question 2: Does it depend on something that may never happen? Yes means contingent goods.
Question 3: Is the exact item named or pointed out? Yes means specific. No means unascertained.
For perishing goods: before the contract is Section 7, after the agreement but before the risk passes to the buyer is Section 8. Both need specific goods and no fault.

Common mistakes in Goods and Their Classification

Treating money, debts or land as goods.
Students think anything that can be sold is goods.
Fix: Remember the definition: only movable property, excluding actionable claims and money. Land is immovable.
Thinking future goods can be sold outright.
The word sale in the contract misleads the student.
Fix: A purported present sale of future goods operates as an agreement to sell (Section 6(3)). Property passes later, when the goods are acquired and appropriated to the contract.
Confusing specific goods with ascertained goods.
Both mean identified goods.
Fix: The Act defines specific goods (Section 2(14)) as goods identified and agreed upon at the time the contract is made. Ascertained goods are described in case law and commentary as goods identified after the contract is made.
Treating contingent goods as a separate category from future goods.
Students read Section 6(2) as a stand-alone class.
Fix: Contingent goods are a kind of future goods, since the seller will get them later and only if the contingency occurs.
Applying Section 7 or 8 to unascertained goods.
Students remember perishing but forget the specific goods condition.
Fix: Both sections apply only to specific goods. Unascertained goods can be replaced from other stock.
Mixing up Section 7 and Section 8 timing.
Both sections talk about goods perishing and the contract becoming void.
Fix: Section 7 is perishing before the contract is made. Section 8 is perishing after the agreement to sell but before the risk passes to the buyer.

Worked examples

Example 1

Ravi, a mango grower in Ratnagiri, agrees on 1 March to sell 500 kg of mangoes from his orchard's crop of the coming season to Meena for ₹60,000. What type of goods are these, and what is the legal nature of the contract?

Show the solution

The mangoes have not yet been produced on the date of the contract, so Ravi does not own or possess them at that time.
Goods to be produced or acquired by the seller after the contract is made are future goods.
Ravi only agrees to sell goods that do not yet exist, so this is an agreement to sell. Even a purported present sale of future goods would operate as an agreement to sell under Section 6(3).
Property in the mangoes will pass only after they are produced and the conditions for transfer are met.

Answer: The mangoes are future goods, and the contract is an agreement to sell, not a completed sale.

Example 2

Sharma agrees to sell to Verma a particular Hero motorcycle lying in his showroom. Before the contract was made, the motorcycle was destroyed in a fire, which Sharma did not know. What is the position of the contract?

Show the solution

The motorcycle is identified in the contract, so it is specific goods.
It perished before the contract was made, and the seller did not know of it.
Section 7 says that a contract for specific goods that, unknown to the seller, have perished at the time of making the contract is void.
So the contract is void from the start.

Answer: The contract is void under Section 7 because the specific goods had already perished.

Exam tips

Look for the keyword in the question: 'description', 'bulk' or 'sample' points to unascertained goods; 'this particular' points to specific goods.
Pay attention to timing words such as 'will be manufactured', 'at the time of contract' and 'after the agreement'. They decide existing or future goods.
Learn two sentence versions of Sections 7 and 8, then pick the option that matches the timing and the specific goods condition.
A purported present sale of future goods operates as an agreement to sell (Section 6(3)). Mark a statement that treats it as a completed sale of those goods as false.
Eliminate options that call land, shares or money wrongly. Shares are goods, while money and actionable claims are not.

Practice questions from Sale of Goods Act, 1930

Goods and Their Classification in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Goods and Their Classification: frequently asked questions

What is the difference between specific goods and unascertained goods?

Specific goods are identified and agreed upon when the contract is made, like one named car. Unascertained goods are described only by type, quantity, sample or as part of a bulk. They become ascertained when the exact goods are picked out after the contract.

What are contingent goods, with an example?

Contingent goods are goods that the seller will acquire only if a certain event happens. Example: a trader agrees to sell goods that he will get only if a ship carrying them arrives. They are a type of future goods.

Are shares and growing crops goods?

Yes. The Act includes stock and shares, growing crops, grass and things attached to land that are agreed to be severed before sale or under the contract. Land itself, money and actionable claims are not goods.

What happens if goods perish before the risk passes to the buyer under Section 8?

If there is an agreement to sell specific goods and the goods perish or become so damaged without fault of the seller or buyer before the risk passes to the buyer, the agreement becomes void. It applies to specific goods only.