A sale is a transaction between two or more parties in which the buyer receives tangible or intangible goods, services, or assets in exchange for money. In some cases, other assets are paid to a seller. An agreement by which one of the contracting parties, called the seller, gives a thing and passes the title to it, in exchange for a certain price in current money, to the other party, who is called the buyer or purchaser, who, on his part, agrees to pay such price. This contract differs from a barter or exchange in this, that in the latter the price or consideration, instead of being paid in money, is paid in goods or merchandise, susceptible of a valuation. It differs from accord and satisfaction, because in that contract, the thing is given for the purpose of quieting a claim, and not for a price. An onerous gift, when the burden it imposes is the payment of a sum of money, is, when accepted, in the nature of a sale.
To constitute a valid sale there must be,
- Proper parties.
- A thing which is the object of the contract.
- A price agreed upon; and,
- The consent of the contracting parties, and the performance of certain acts required to complete the contract. These will be separately considered. Sale is transfer of ownership in immovable property.
Sale deed is a legal document and an evidence that the sale of a property has been made in favour of the buyer from the seller.
- Transfer of ownership
- In exchange of price completely paid or Part paid and part promised or promised to be paid
- Registration is necessary if the value is Rs100/- and above.
DUTIES OF SELLERS BEFORE SALE
- To disclose material defects in the property or title if
- Patent material defect need not be disclosed
- Latent material defect to be disclosed (Easement, Restrictive covenant etc)
- To produce the title deeds for inspection
- To answer relevant questions as to title
- To execute conveyance
- To take care of the property and title deeds
- To pay out goings
The following are the essential conditions regarding Sale:
ü There must be at least two parties; one is the buyer, and other is the seller.
ü The subject matter of the sale is the goods.
ü Payment should be made in the country’s legal currency.
ü The goods should pass from seller to buyer.
ü All the necessary conditions of a valid contract should be present like free consent, consideration, a lawful object, capacity of parties, etc.
ü If the goods are being sold and the property is transferred to the buyer, but the seller is not paid. Then, the seller can go to the court and file a suit against the buyer for the damages and the price too. On the other hand, if the goods are not delivered to the buyer then he can also sue the seller for damages.
DUTY OF SELLERS AFTER-SALE
- To give possession of property
- To covenant to title
- To deliver title deeds on receipt of price
DUTY OF BUYERS BEFORE SALE
- To disclose facts which materially increases the value of property
- To pay the price
DUTY OF BUYERS AFTER-SALE
- To bear the loss to property , if any
- To pay the out goings
APPLICATION OF SEC-55
In the absence of contract contrary
- Law permits a person to sell the property on his own terms and the purchaser may agree to take the property on such terms in such circumstances the terms and conditions are governed by their own not under sec If the sale deed is silent regarding the respective rights and liabilities(open contract) Sec55 deals the same.
Definition of Agreement to Sell
An agreement to sell is also a contract of sale of goods, in which the seller agrees to transfer goods to the buyer for a price at a later date or after the fulfilment of a condition.
|BASIS FOR COMPARISON||SALE||AGREEMENT TO SELL|
|Meaning||When in a contract of sale, the exchange of goods for money consideration takes place immediately, it is known as Sale.||When in a contract of sale the parties to contract agree to exchange the goods for a price at a future specified date is known as an Agreement to Sell.|
|Type of Contract||Executed Contract||Executory Contract|
|Transfer of risk||Yes||No|
|Title||In sale, the title of goods transfers to the buyer with the transfer of goods.||In an agreement to sell, the title of goods remains with the seller as there is no transfer of goods.|
|Right to sell||Buyer||Seller|