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Please answer this query of sale of goods act, 1930

priyanshu saxena (MBL LL.B.(Hons.) CS (Professional) wit) (2653 Points)

11 February 2012

In a contract of sale as per terms and conditions of contract C goes to deliver 100 bags of Rice in a truck to the godown premises of D on the date fixed for delivery. D refuses to take delivery of the same. Is C discharged from his liability?

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Ashok Kumar V (Audit Assistant) (77 Points)
Replied 11 February 2012

As per sec-38 of the Indian Contract Act 1872 Mr.C is discharged from his liabilty and he does not lose his right against Mr.D provided if the following conditions are satisfied

1) it must be unconditional;

(2) it must be made at a proper time and place, and under such circumstances that the person to whom it is made may have a reasonable opportunity of ascertaining that the person by whom it is been made is able and willing there and then to do the whole of what he is bound by his promise to do;

(3) if the offer is an offer to deliver anything to the promisee, the promisee must have a reasonable opportunity of seeing that the thing offered is the thing which the promisor is bound by his promise to deliver. An offer to one of several joint promisees has the same legal consequences as an offer to all of them.

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priyanshu saxena (MBL LL.B.(Hons.) CS (Professional) wit) (2653 Points)
Replied 13 February 2012

Sir, I would like to mention that as per Section 41 unless otherwise agreed, where goods are delivered to the buyer and he refuses to accept them, having the right so to do, he is not bound to return them to the seller but it is sufficient if he intimates to the seller that he refuses to accept them

and Section 38 talks about delivery in installment of the goods...

here Mr. C has fulfilled each n every condition

he followed the terms and conditions of the contract
he took 100 bages of Rice in a truck to the godown premises of Mr. D
on the date fixed for delivery

now if Mr. D refuses to take delivery of the same what would be the ground of his refusal showing the incapability of Mr. C

and if Mr. C is discharged from his liablity under section 38, Mr. D is not liable as per Section 41 to look after or return the goods to Mr. C

Resolve my query please........:

CA Darshak Shah (Practicing CA) (1889 Points)
Replied 14 April 2012

To Priyanshu,

I guess following para will be useful to you..

"When the seller is ready
and willing to deliver the goods and requests the buyer to take delivery, and the buyer does not
within a reasonable time after such request take delivery of the goods , he is liable to the seller
for any loss occasioned by his neglect or refusal to take delivery and also for a reasonable charge
for the care and custody of the goods.
Provided that nothing in this section shall affect the rights of the seller where the neglect or
refusal of the buyer to take delivery amounts to a repudiation of the contract."