Skip to content

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

Under the Sale of Goods Act, 1930, which of the following sellers is deemed to be an 'unpaid seller'?

A seller who received a cheque as conditional payment that was then dishonoured is an unpaid seller, because the condition on which the instrument was accepted was not fulfilled. The Act treats such a seller as unpaid, just as one whose price has not been paid or tendered.

  1. AA seller who has received the whole price in cash before delivery
  2. BA seller who has received a cheque as conditional payment and the cheque is dishonoured on presentationCorrect
  3. CA seller who has been paid part of the price and has agreed to treat it as full settlement
  4. DA seller who has delivered the goods and received the price through the buyer's agent

Explanation

A seller is an unpaid seller when the whole price has not been paid or tendered, or when a negotiable instrument received as conditional payment is dishonoured. The dishonoured cheque case fits the second limb. The other options involve full payment or settlement, so the seller is not unpaid.

Did you get it right without looking?

One question tells you little. A timed set on Sale of Goods Act, 1930 shows your real accuracy, how long you take and where you lose marks.

Practise Sale of Goods Act, 1930Free diagnostic mock

More Sale of Goods Act, 1930 questions