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

Sunita contracts to sell a specific machine lying in her godown to Rohit. Unknown to Sunita, a fire had destroyed the machine before the contract was made. What is the position?

The contract is void. Under Section 7, where a contract is for specific goods that, without the seller's knowledge, had already perished or become so damaged that they no longer match their description when the contract was made, the contract is void.

  1. AThe contract is voidable at Rohit's option
  2. BThe contract is voidCorrect
  3. CThe contract is valid and Sunita must pay damages
  4. DThe contract is valid and the price must be paid

Explanation

Section 7 says that where specific goods have, without the seller's knowledge, perished at the time of contract, the contract is void. Voidable is wrong because the Act declares it void, not voidable.

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