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

Varun bought 50 sewing machines from Kalyan Industries, price payable in 30 days from delivery. Kalyan delivered them, and Varun wrongfully refused to pay even after 30 days. Property in the goods had passed to Varun on delivery. Kalyan sued Varun for the price. Which statement is correct?

Kalyan may sue Varun for the price. Property in the machines passed to Varun on delivery, and he wrongfully refused to pay as the contract required. In such a situation the Act gives the seller the remedy of a suit for the price rather than only damages.

  1. AKalyan may sue for the price because the property has passed and the buyer wrongfully refuses to payCorrect
  2. BKalyan may only sue for damages for non-acceptance because the goods are with the buyer
  3. CKalyan cannot sue, but may resell the machines to a third party
  4. DKalyan may sue only after rescinding the contract

Explanation

Where property has passed to the buyer and he wrongfully neglects or refuses to pay according to the contract, the seller may sue for the price. The goods are already delivered, so no resale is possible. Damages for non-acceptance apply where the property has not passed, which is not the case here.

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