Law on Sale of Goods: Delivery, Payment and Performance
Introduction
The law on sale of goods governs how contracts are performed between buyer and seller. It covers duties, delivery rules, payment, and rights during the execution of a contract. Sections 31 to 41 of the Sale of Goods Act, 1930 provide these principles in detail.
Meaning / Definition
The law on sales refers to the legal rules that regulate:
- Delivery of goods
- Payment of price
- Performance of contract
It ensures that both buyer and seller fulfil their obligations as agreed.
Modes or Types
Duties of Buyer and Seller (Section 31)
- Seller must deliver goods as per contract
- Buyer must accept goods and pay the price
- Both must act according to agreed terms
Concurrency of Payment and Delivery (Section 32)
- Delivery and payment happen together (concurrent conditions)
- Seller must be ready to deliver goods
- Buyer must be ready to pay the price
Rules relating to Delivery of Goods
Delivery of Goods (Section 33)
- Delivery can be made by:
- Giving possession to buyer
- Giving possession to authorised person
- Doing anything agreed by parties
Effect of Part Delivery (Section 34)
- Part delivery may amount to full delivery if it shows intention to deliver all
- If part delivery separates goods, it is not delivery of whole
Buyer to Apply for Delivery (Section 35)
- Seller need not deliver unless buyer requests delivery
- Exception: when contract says seller must deliver
Place of Delivery (Section 36(1))
- If agreed → follow contract
- If not agreed:
- Existing goods → delivered where they are at time of sale
- Future goods → delivered where produced
Time of Delivery (Section 36(2))
- If no time fixed → delivery within reasonable time
Goods with Third Party (Section 36(3))
- Delivery complete only when third party confirms holding goods for buyer
Time for Tender of Delivery (Section 36(4))
- Delivery must be offered at reasonable time
Expenses of Delivery (Section 36(5))
- Seller bears expenses unless agreed otherwise
Delivery of Wrong Quantity (Section 37)
- Less quantity → buyer may reject or accept and pay
- Excess quantity → buyer may accept agreed quantity or reject all
- Mixed goods → buyer may accept correct goods or reject all
Instalment Delivery (Section 38)
- Buyer not bound to accept instalments unless agreed
Delivery to Carrier
- Delivery to carrier is treated as delivery to buyer (unless otherwise agreed)
Deterioration in Transit (Section 40)
- Buyer bears risk of normal loss during transit
Buyer’s Right to Examine Goods (Section 41)
- Buyer must get reasonable chance to inspect goods
- Seller must allow inspection
Distinction / Comparison
Delivery vs Payment
| Basis | Delivery of Goods | Payment of Price |
|---|---|---|
| Nature | Transfer of possession | Transfer of money |
| Role | Seller’s duty | Buyer’s duty |
| Timing | Concurrent with payment | Concurrent with delivery |
| Default | Buyer may reject goods | Seller may sue for price |
Practical Example
A agrees to sell machinery to B.
- A must deliver machinery at agreed place and time
- B must pay at the time of delivery
- If A sends excess quantity → B can accept required amount only
- If B is not allowed to inspect → he can reject goods later
Summary
- Seller must deliver goods and buyer must pay and accept them
- Delivery and payment are usually done at the same time
- Law provides detailed rules on place, time, and manner of delivery
- Buyer has rights like inspection and rejection
- Seller must follow contract terms strictly
- These rules ensure smooth performance of sale contracts