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

Ravi buys a machine from Kapoor Engineering. The contract says that the seller gives no implied condition as to fitness, and Ravi signs it. What is the legal effect of this term?

The term is valid. Under the Act, rights, duties or liabilities that would arise by implication of law in a contract of sale can be negatived or varied by express agreement, so the parties may exclude the implied condition as to fitness.

  1. AIt is valid, because rights, duties or liabilities arising by implication of law may be negatived or varied by express agreementCorrect
  2. BIt is void, because implied conditions can never be excluded
  3. CIt is valid only if a court approves it beforehand
  4. DIt is voidable at Ravi's option, only if the machine proves defective

Explanation

Section 62 allows any right, duty or liability arising by implication of law to be negatived or varied by express agreement, course of dealing or binding usage. The express exclusion is therefore effective. No court approval is required by the section.

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