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CSEET · Business Laws and Management · Elements of Law relating to Sale of Goods

Under the Sale of Goods Act, 1930, a contract for the sale of specific goods is made on a date when, unknown to the seller, the goods had already perished. What is the legal position?

The contract is void. Under Section 7, where specific goods have already perished or been so damaged that they no longer answer their description when the contract is made, and the seller did not know, the contract is void from the beginning.

  1. AThe contract is voidCorrect
  2. BThe contract is voidable at the option of the buyer only
  3. CThe contract is valid and the seller must pay damages
  4. DThe contract is valid but the price is reduced

Explanation

Section 7 provides that where there is a contract for the sale of specific goods, the contract is void if the goods, without the knowledge of the seller, have perished at the time the contract was made. It is void from the start, not voidable, and no damages arise from the seller's liability under the contract.

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