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CA Foundation · Business Laws · The Sale of Goods Act, 1930

Harish sells a specific, ready second-hand car to Imran for Rs 3,00,000. The agreement says nothing about when ownership passes, and the car is in a deliverable state. Payment and delivery are both to be made next week. When does the property in the car pass to Imran?

Property passes to Imran when the contract is made. For specific goods in a deliverable state, ownership transfers at the time of the agreement unless the parties show a different intention. Postponing payment or delivery does not delay the transfer of property.

  1. AWhen the agreement of sale is madeCorrect
  2. BWhen Imran pays the price
  3. CWhen the car is delivered to Imran
  4. DWhen the car is registered in Imran's name

Explanation

For specific or ascertained goods in a deliverable state, property passes when the contract is made, when intention is not otherwise shown. Time of payment or delivery being postponed does not matter. So ownership passes at the time of the agreement, not at payment or delivery.

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