Existing Goods
According to Section 6 of the Sales of Goods Act, 1930, “Existing goods are those goods that exist at the time of making a contract of sale or in other words these goods are physically present at the time of contract.” Existing goods are owned/acquired or have the seller at the time of entering the contract of sale. There can be three distinctions in existing goods:
I. Specific Goods:
According to Section 2(14) of the Sales of Goods Act, the goods that are particularly identified and which are agreed upon at the time of the formation of the contract of sale are known as Specific Goods.
For example, Rohit went to Rahul’s mobile shop. Rahul’s shop has different types of smartphones from different companies. Rohit specifically selects the Samsung S23 12+256GB phantom black variant. Rahul agrees to sell the Samsung S23 12+256GB phantom black variant to Rohit. In this case, the sale is for a specific mobile phone and hence is a specific good.
II. Ascertained Goods:
Ascertained Goods are those goods that are identified as per the agreement after the contract of sale is initiated. However, the term Ascertained Goods is not defined in the act but has been carved out of judicial judgments and interpretations. In a real scenario, ascertained goods are used in the same sense as specific goods. When out of a big lot or out of a huge quantity of unascertained goods, a particular number or particular quantity to be contracted for is identified, such particularly identified goods are called Ascertained Goods. It is worth noting that before the ascertainment of the goods, the contract was for the sale of unascertained goods.
For example, Mukesh is a dealer of clay pots and has 2,000 clay pots, which he keeps in his warehouse. Rahim contracts with Mukesh to purchase 500 clay pots. Rahim selected 500 clay pots out of 2,000 and set them aside to purchase. As the clay pots that are to be sold are identified and agreed upon after the formation of the contract, this is a contract for Ascertained Goods.
III. Unascertained Goods:
Unascertained Goods are those goods that are not particularly identified or ascertained at the time of the making of the contract. Unascertained Goods are indicated or defined only by description or sample.
For example, Tim, a dealer of pulse agrees to sell 50kg of pulse to Jim out of a lot of 1,000kg. Here, the goods that will be sold to Jim are not specific as they will be given out of the lot of 1,000kg, Tim may randomly select 50kg of pulse and sell it to Jim. This is a case of Unascertained Goods.
Kinds of Goods under the Sale of Goods Act, 1930
Almost every type of business somewhere or the other involves the sale and purchase of goods as part of its business operation. In some cases, sales and purchases are made to support the main business framework and in some cases, sales and purchases are the main business. Businesses often enter into a contract of sale to sell their commodities to other parties. The Sale of Goods Act, 1930 is an umbrella act that governs all forms of sales. A sale is a general contract wherein the seller or owner of particular goods transfers or agrees to transfer the goods to a buyer at an agreed price.
As per Section 2 of the Sale of Goods Act, 1930, “a contract of sale is a term that includes both sale and agreement to sell and is characterized by an offer to buy goods for a price or an offer to sell goods for a price, and acceptance of the offer.”
Geeky Takeaways:
- Every individual, whether a businessman or a common man, who deals in the transaction of goods regularly, must understand the important terms of the Sale of Goods Act, 1930.
- India is one of the largest economies that has adequate measures to ensure the safety of its business.
- The sale of commodities is one of the most important types of contract under the law in India.
- This act was passed because the provisions of the contract act were found to be inadequate to deal with new situations that were arising due to an increase in mercantile situations.
Table of Content
- Kinds of Goods under Sale of Goods Act, 1930
- 1. Existing Goods
- 2. Future Goods
- 3. Contingent Goods
- Effect of Perishing of Goods
- Conclusion
- Frequently Asked Questions (FAQs)
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