ECO 05 Solved Assignment 2022 – 23
IGNOU B.Com Free Solved Assignment 2022 – 23
Mercantile Law ECO 05 Solved Assignment 2022 – 23
COURSE CODE: ECO-05
COURSE TITLE: MERCANTILE LAW
ASSIGNMENT CODE: ECO-05/TMA/2022-23
COVERAGE: ALL BLOCKS
Maximum Marks: 100
In this post, you will get ECO 05 Solved Assignment 2022 – 23. For Free B.Com IGNOU Solved Assignments 2022 – 23, you can visit our website regularly or you can download our mobile application. We will try to provide IGNOU Solved Assignments 2022 – 23 for BA, MA, MCOM, BBA and MBA also.
Attempt all the questions.
1. Explain the law relating to communication of offer and acceptance and their revocation. (20)
Ans: Offer and Rules relating to offer
The term ‘proposal’ is otherwise called as ‘offer’. An offer is a proposal by one person, whereby he expresses his willingness to enter into a contractual obligation in return for promise, act or forbearance. Section 2(a) of the Act defines ‘proposal’ or offer as when one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining the assent of that other to such act or abstinence. The person making the proposal is called as ‘offeror’ or proposer’ and the person the proposal is made is called as ‘Offeree’.
Rules as to Offer:
1. Intention to create legal relationship: The Offeror while making the offer must do it with the intention to create legal relations. Offeror must be conscious that a contract will arise, if the Offeree accepts the same.
2. Certain or Unambiguous: The terms of the Offer to be valid must be certain, clear and unambiguous. For e.g. An offers to sell B, ten tons of oil. A is a dealer of various oil. Here the offer is ambiguous as the offer does not specify the type of oil. However, if A was a dealer only in Parachute Coconut oil then the offer is unambiguous.
3. Offer must be distinguished from:
(i) A declaration of intention: A declaration by a person that he intends to do something gives right of action to another. Such a declaration only means that an offer will be made or invited in future and not that an offer is made now.
(ii) An invitation to make an offer or do business: Display of goods by a shopkeeper in his window, with prices marked on them, is not an offer but merely an invitation to the public to make an offer to buy the goods at the marked prices. A buyer, in case the prices of the goods are marked, cannot force the seller to sell the goods at those prices.
He can, at the most, ask the seller to sell the goods to him, in which case he is making an offer to the seller and it is up to the seller to accept the offer or not. Likewise, quotations, menu card, catalogues, prospectus issued by a company for subscribing to shares are all example of an invitation to make an offer.
4. Offer must be to a definite person: The words of an Offer must apply to definite persons or class of persons to create a legal relationship.
5. Offer must be communicated: An offer, to be complete, must be communicated to the person to whom it is made. Unless an offer is communicated, there can be no acceptance of it.
6. Offer must be made with a view to obtaining the assent: The offer to do or not to do something must be made with a view to obtaining the assent of the other party addressed and not merely with a view to disclosing the intention of making an offer.
7. Special Terms to be made clear in the Offer: The offer may be conditional but the conditions or special terms must be clearly communicated in the offer. Whenever an offer has special terms attached to it, these special terms and conditions must be effectively communicated to the Offeree to bind him.
8. Offer should not contain a term, the non-compliance of which may be assumed to amount to acceptance: A person cannot say that if acceptance is not communicated within a certain time, the offer would be considered as accepted.
Acceptance and Rules relating to acceptance
Section 2(b) defines acceptance as “When a person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal when accepted becomes a promise.” Acceptance is an expression by the Offeree of his willingness to be bound by the terms of the offer.
Acceptance may be express or implied. It is express when it is communicated by words spoken or written or by doing some required act. It is implied when it is to be gathered from the surrounding circumstances or the conduct of the parties. For e.g. At an auction sale, S is the highest bidder. The auctioneer accepts the offer by striking the hammer on the table. This is an implied acceptance.
Rules as to Acceptance
1. It must be absolute and unqualified: An Acceptance, in order to be binding, must be absolute and unqualified of all the terms of the offer, whether material or immaterial, major or minor.
2. It must be communicated to the Offeror: The acceptance must be communicated in some acceptable form to the person making offer to conclude a contract. A mere mental determination or communication to some third party does not constitute communication.
3. It must be expressed according to the mode prescribed or usual and reasonable mode: If the acceptance is not according to the mode prescribed, the offeror may, within a reasonable time after the acceptance is communicated to him insist that his proposal shall be accepted in the prescribed mode. However, if no mode is prescribed the acceptance may be in a usual or reasonable mode.
4. It must be given within a reasonable time: If no time is specified the acceptance must be within a reasonable time. The reasonability of the time shall depend on the ordinary course of trade and business. However, if a time limit is prescribed acceptance must be within the specified time.
5. It cannot precede an offer: Acceptance always follows an offer. Without the knowledge of offer there is no acceptance.
6. Mere silence is not acceptance: The acceptance of an offer cannot be implied from the silence of the Offeree or his failure to answer.
7. It must show an intention on the part of the acceptor to fulfill the terms of the promise: The acceptor of the offer must be ready and prepared to be bound by the conditions of the offer and to fulfill the offer. If no such intention is present, the acceptance is not valid.
Revocation of the Offer
Section 5 provides that a proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer. Thus, Section 5 of the Indian Contract act, 1872 gives right to person making proposal to revoke and the person is entitled to revoke the same before the communication of its acceptance is complete.
In other terms, before the completion of acceptance against offeror, the offer may be revoked by the offeror at any time. In this respect, section 5 mentions as under: –
Revocation of Proposals and Acceptances: A proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards.
Further, Section 4 mentions about when the communication of revocation is complete as under:
The communication of a revocation is complete as against the person who makes it, when it is put into a course of transmission to the person to whom it is made, so as “to be out of the power of the person who makes it.
The communication of a revocation is complete as against the person to whom it is made, when it comes to his knowledge.
Revocation of Acceptance
Revocation of acceptance means the withdrawal of the acceptance to an offer by the offeree. In this respect, section 5 mentions that ‘an acceptance may be revoked at any time before the communication of the acceptance is complete as against the acceptor but not afterwards.
‘For example – A proposes, by a letter sent by post, to sell his houses to B. B accepts the proposal by a letter sent by post. B may revoke his acceptance at any time before or at the moment when the letter communicating it reaches A, but not afterwards.
2. (a) “Silence as to the facts is not fraud” comment (10)
Ans: “Fraud” Defined: “Fraud” means and includes any of the following acts committed by a party to a contract, or which his connivance, or by his agent, with intent deceive another party thereto of his agent, or to induce him to enter into the contract.
(1) The suggestion, as a fact, of that which is not true, by one who does not believe it to be true;
(2) The active concealment of a fact by one having knowledge or belief of the fact;
(3) A promise made without any intention of performing it;
(4) Any other act fitted to deceive;
(5) Any such act or omission as the law specially declares to be fraudulent.
Explanation: Mere silence as the facts likely to affect the willingness of a person to enter into a contract is not fraud, unless the circumstances of the case are such that, regard being had to them, it is the duty of the person keeping silence to speak, or unless his silence is, in itself, equivalent to speech.
(a) A sells, by auction, to B, a horse which A knows to be unsound. A says nothing to B about the horse’s unsoundness. This is not fraud in A.
(b) B is A’s daughter and has just come of age. Here, the relation between the parties would make it A’s duty to tell B if the horse, is unsound.
(c) B says to A. “If you do not deny it, I shall assume that the horse is sound.” A says nothing. Here, A’s silence is equivalent to speech.
(d) A and B, being traders, enter upon a contract. A has private information of a change in prices which would affect B’s willingness to proceed with the contract. A is not bound to inform B.
It is to be noted that even under this definition of fraud a promise made by a party without any intention of performing it, or any other act fitted to deceive are acts covered under this definition of fraud.1
Sec. 17 says that fraud means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto of his agent, or to induce him to enter into the contract.
(1) The suggestion, as a fact, of that which is not true, by one who does not believe it to be true;
(2) The active concealment of a fact by one having knowledge or belief o he fact;
(3) A promise made without any intention of performing it.
(4) Any other act fitted to deceive;
(5) Any such act or omission as the law specially declares to be fraudulent.
When consent to an agreement is caused by fraud, the agreement is a contract voidable at the option of the party whose consent was so caused. A party to a contract whose consent was caused by fraud, may, if he thinks fit, insist that the contract shall be performed, and that he shall be put in the position in which he would have been if the representations made had been true.
In Satis Chandra v. Satish Kantha, it was held that “charges of fraud and collusion must, no doubt, be proved by those who make them-proved by established facts or inferences legitimately drawn from those facts taken together as a whole. Suspicions and surmises and conjectures are not permissible substitutes for those facts or those inferences, but that by no means requires that every puzzling artifice or contrivance resorted to by one accused of fraud must necessarily be completely unraveled and cleared up and made plain before a verdict can be properly found against him. If this were not so, many a clever and dexterous knave escape.”
In BhauraoDagduParalkar v. State Maharashtra, the court observed that fraud as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud.
A fraudulent misrepresentation is called deceit and consists in leading a man into damage by willfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representation, which he knows to be fa!.., and injury ensures there from although the motive from which the representations proceeded may not have been bad. An act of fraud on Court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous.
(b) What are contingent contracts? Stats the rules regarding enforcement of such contracts with examples. (10)
Ans: Contingent Contract: According to the Contract Act a contingent contract is one whose performance us uncertain. The performance of the contract which comes under this category depends on the happening or non- happening of certain uncertain-events. On the other hand, an ordinary or absolute contract is such where performance is certain or absolute in itself and not dependent on the happening or non-happening of an event. A contingent contract is defined as a contract to do or not to do something, if some event, collateral to such contract, does or does not happen (sec. 31).
(A) A contracts to pay Rs. 50,000 if B’s house is destroyed by five. This is a contingent contract as the performance depends on the happening of an event.
(B) A asks B to give loan to M and promises that he (A) will repay the loan if M does not return it in time.
Characteristics of a Contingent Contract: A Contingent Contract must have three essential characteristics. There are:
(1) The performance of the contract depends on the happening or non-happening of a certain event in future. This dependence on a probable future event distinguishes a contingent contract from an ordinary contract.
(2) This event must be uncertain, that means happening or non-happening of the future event is not certain, i.e., it may or may not happen. If the event is hundred percent sure to happen, and the contract in that case has to be performed any way, such a contract is not called a contingent contract.
(3) The event must be collateral or incident to the contract. Therefore, contracts of indemnity, guarantee and insurance are the most common instances of a contingent contract.
Rules regarding contingent contracts: To enforce the performance of a contingent contract the following rules have to be followed:
1. Where the performance of a contingent depends on the happening of an uncertain future event, it cannot be enforced till the event takes place. And if the happening of the event becomes impossible, such contracts become void (sec. 32). Example- A contracts to sell B a piece of land if he (A) wins the legal case involving that piece of land. A loses the case. The contract becomes void.
2. Where the performance of a contingent contract depends on the non-happening of a future event, the contract can be enforced if the happening becomes impossible (sec. 33). Example- A agrees to sell his house to B if Y dies. This contract cannot be enforced till Y is alive.
3. If the contract is dependent on the manner in which a person will act at an unspecified time, the event shall be considered to become impossible when such person does anything which makes it impossible that he should so act within any definite time or otherwise than under further contingencies (sec. 34).
4. Contingent contract to do or not to do anything, if a specified uncertain event happens within a fixed time, becomes void if the event does not happen and the time expires or its happening becomes impossible before the time expires [sec. 35(1)].
5. Contingent contract to do or not to do anything, if a specific event does not happen within a specified time, may be enforced when the time so specified expires and such event does not happen, or before the time so specified it becomes certain that such event will not happen [sec. 35(1)].
6. Contingent agreements to do or not to do anything, if an impossible event happens, are void, whether or not the fact is known to the parties at the time when it is made (sec. 36).
3. (a) “Delegatus non potest delegare”. Discuss the implication of this in relation to agency and state the exceptions to this rule. (10)
Ans: Meaning of Agent and Principal
An agent is a person employed to do any act for another or to represent another in dealings with third person. Agent is a person who acts as a link between principal and third parties. The person for whom such act is done is called the principal.
Provisions regarding to Agent: A person may become an agent –
a) If he is of the age of majority according to the law to which he is subject;
b) He is of sound mind;
c) No consideration is necessary for the appointment of agent;
d) The authority of an agent may be expressed or implied;
According to Sec. 187, an authority is said to be express, when it is given by words spoken or written. An authority is said to be implied when it is to be inferred from the circumstances of the case; and things spoken or written, or the ordinary course of dealing, may be accounted circumstances of the case.
Contract of agency
Agency is a relationship between two parties in which one party known as agent agrees to represent or act for the other person known as principal. Contract of agency is simply an intention to create relationship between agent and principal so as to establish legal relation of principal with third person through agent. The following are the essential elements of a contract of agency:
1) Principal must be competent to enter into a contract. If he is not, he cannot appoint an agent.
2) At the time of creation of agency, there is no need of consideration as the agent is remunerated by way of commission for services rendered.
Duty not to Delegate:
When a principal appoints an agent, he sees many things in him like honesty, faithfulness, etc. After considering many factors, the principal appoints an agent. So, it is natural that an agent cannot lawfully employ another to perform acts which he has expressly or impliedly undertaken to perform personally, unless by the ordinary custom of trade a sub-agent may, or, from the nature of the agency, a sub-agent must, be employed.
In Jaswant Singh v. Ashwani Gupta, Jammu & Kashmir High Court said that a person, who acts on behalf of another person (the principal) by his authority, expressed or implied is called an ‘agent’ and the relation between him and his principal is called ‘agency’. The authority of an agent is thus is the power to effect his principal’s decision by doing acts on his behalf. Actual authority is legal relationship between the principal and the agent created by a consensual agreement to which they alone are parties. The power of attorney is generally irrevocable and terminable at the will of the principal.
Generally, the agent cannot delegate his work which is assigned to him but there are some circumstances where the delegation of work by agent is lawful and valid as:
(a) There is any custom of trade.
(b) Works which need professional skills. For example- where agent is not expert of accounting but in case of any work related to auditing of accounts, he can take the services of Chartered Accountants.
(c) Nature of work makes necessary to delegate. Like-if an agent is assigned for auction of property. He can take the services of an auctioneer.
(d) With principal’s consent also, the work may be delegated.
(e) The duties of agent are rights of the principal.
(b) Explain the rights and liabilities of partners on dissolution of partnership firm. (10)
Ans: Rights and liabilities of partners on dissolution of firms (Sec 45 – 55): Consequent to the dissolution of a partnership firm, the partners have certain rights and liabilities which are stated below:
1. Liability for acts of partners done after dissolution (Sec. 45): Section 45 provides that the liability of the partners will continue for the acts done before the dissolution, even after the dissolution, until public notice is given of the dissolution. The following partner is not liable for the acts after the date on which he ceases to be a partner:
a) A deceased partner.
b) Partner who is adjudicated as an insolvent.
c) A Partner who is not known to the parties dealing with the firm as a partner retires from the firm.
2. Right to share surplus after dissolution (Sec. 46): Section 46 provides that on the dissolution of a firm, every partner or his representative is entitled as against all the other partners or their representatives, to have the property of the firm applied in payment of the debts and liabilities of the firm and to have the surplus distributed among the partners or their representatives according to their rights.
3. Continuing authority of partners (Sec. 47): Section 47 provides that after the dissolution of a firm, the authority of each partner to bind the firm and the other mutual rights and obligations of the partners continue, notwithstanding the dissolution, so far as may be necessary to wind up the affairs of the firm and to complete transactions begun but unfinished at the time of the dissolution, but not otherwise.
4. Mode of settlement (Sec. 48): Section 48 provides the mode of settlement of accounts between the partners after the dissolution. In this regard, the following shall be observed, subject to the agreements by the partners:
a) Losses, including deficiencies of capital, shall be paid first out of profits, next out of capital and lastly if necessary by the partners individually in the proportions in which they were entitled to share profits.
b) The assets of the firm, including any sums contributed by the partners to make up deficiencies of capital shall be applied in the following manner and order:
1. In paying the debts of the firm to the third parties.
2. In paying to each partner ratably what is due to him from the firm for advances as distinguished from capital.
3. In paying to each partner ratably what is due to him on account of capital; and
4. The residue, if any, shall be divided among the partners in the proportions in which they were entitled to share profits.
5. Payment of firm debts (Sec. 49): Section 49 provides that where there are joint debts due from the firm and also separate debts due from any partner, the property of the firm shall be applied in the first instance in payment of the dues of the firm. If there is any surplus, then the share of each partner shall be applied in payment of his separate debts or paid to him. The separate property of any partner shall be applied first in the payment of his separate debts and the surplus, if any, in the payment of the debts of the firm.
6. Personal profits after dissolution (Sec. 50): Section 50 provides that the personal profits earned by any surviving partner or by the representatives of a deceased partner who carrying on the business of the firm, then such personal profits shall be accounted to the firm.
7. Return of premium of premature dissolution (Sec. 51): Section 51 provides that where a partner has paid a premium on entering into partnership for a fixed term and the firm is dissolved before the expiration of that term otherwise than by the death of the partner, such partner is entitled to repayment of the premium or of such part there of as may be reasonable.
8. Rescinding of contract (Sec.52): Section 52 provides that where a contract creating partnership is rescinded on the ground of the fraud or misrepresentation of any of the parties, the party entitled to rescind is, without prejudice to any other right, to be indemnified by the partner or partners guilty of the fraud or misrepresentation against all the debts of the firm.
9. Restrain to use firm name (Sec. 53):Section 53 provides that after a firm is dissolved, every partner or his representative may, in the absence of a contract between the partners to the contrary, restrain any other partner from carrying on a similar business in the firm name, or from using any of the property of the firm for his own benefit, until the affairs of the firm have been completely wound up.
10. Agreements in restraint of trade (Sec.54):Section 54 provides that partners may, upon or in anticipation of the dissolution of the firm, make an agreement that some or all of them will not carry on a business similar to that of them within a specified period of within the specified local limits, such agreement shall be valid if the restrictions imposed are reasonable.
11. Goodwill (Sec. 55):Section 55 provides that after the dissolution of a firm the goodwill shall be included in the assets and it be sold either separately or along with other property of the firm. Where the goodwill of the firm is sold a partner may carry on a business competing with that of the buyer and he may advertise such business, subject to agreement between him and the buyer, he may not:
a) Use the firm name;
b) Represent himself as carrying on the business of the firm; or
c) Solicit the custom of persons who were dealing with the firm before its dissolution.
The liabilities of a partner on dissolution are as under:
(i) Liability for acts of partners done after dissolution: Until public notice of dissolution of the firm is given; partners continue to be liable to third parties for any act done by any of them. However, this liability does not apply to a partner who is dead or who is adjudged as insolvent or a sleeping partner.
(ii) Continuing authority of partners for purpose of winding up: After dissolution of a firm, the authority of each partner to bind the firm and the other mutual rights and obligations of the partners continue, so far as may be necessary:
(a) To wind up the affairs of the firm and
(b) To complete transactions began but unfinished, at the time of the dissolution.
(iii) Liability to share profits earned after dissolution: If any partner earns any profit from any transaction connected with the firm, after the dissolution, he must share it with the other partners and the legal representative of any deceased partner.
4. (a) Explain the circumstances when a person other than the owner can make a valid pledge. (10)
Ans: Pledge: Section 172 of the Act provides that the bailment of goods as security for payment of a debt or performance of a promise is called ‘pledge’. Unlike a mortgage, a pledge does not have the effect of transferring any interest in the property in favor of the pledge. Delivery of goods is necessary to complete a pledge. The pledge constitutes two parties, namely:
a) Pawnor/Pledger: The bailer (person delivering the goods) in this case is called as Pawnor.
b) Pawnee/Pledgee: The bailee (the person to whom goods are delivered) in this case is called as Pawnee.
The following are the essential ingredients of pledge:
a) Delivery of goods: The goods must be delivered by the Pawnor to the Pawnee. The delivery may be actual or constructive. If goods are not delivered, there is not pledge.
b) Purpose: The delivery of goods must be for security of either for payment of a debt or performance of a promise.
c) In pursuance of a contract: The possession of goods in pledge must be transferred from Pawnor to Pawnee.
d) Pledge discharged on full payment: The Pawnee is entitled to retain the pledged property with him and he is not under duty to return the Pawnor until his debt is fully discharged or promise is performed.
Who can pledge?
Generally, the owner can pledge the goods or with his consent, others can pledge also. Hence, a pledge made by a person, who is neither owner nor allowed by owner, is invalid. But there are some circumstances where a person who is not the owner but in possession of goods can pledge:
a) Pledge by mercantile agent:The term ‘mercantile agent’ is defined under Section 2(2) of Sale of Goods Act as an agent having in the course of ordinary business having authority, either to sell goods or to consign goods for the purposes of sale or to buy goods or to raise money on the security of the money.
Section 178 provides that where a mercantile agent is, with the consent of the owner, in possession or goods or the documents of the title of goods, any pledge made by him, when acting in the ordinary course of business of a mercantile agent, shall be as valid as if he were expressly authorized by the owner of the goods to make the same.
b) Pledge by a person in Possession under voidable contract: If the pledgee acts in good faith and without notice of the pledger’s defect of title, he acquires a good title to the goods.
Section 178 A provides that when the Pawnor has obtained possession of the goods pledged by him under a contract voidable under Section 19 or Section 19 A, but the contract has not been rescinded at the time of pledge, the Pawnee acquires a good title to the goods, provided he acts in good faith and without notice of the pawnor’s defect of title.
c) Limited interest of Pawnor: Section 179 provides that where a person pledges goods in which he has only a limited interest, the pledge is valid to the extent of that interest.
(b) Discuss the legal rules for valid consideration with examples. (10)
Ans: Consideration and Rules relating to Valid Consideration
Section 2 (d) of Indian Contract Act, 1872, defines consideration as “When at the desire of the promisor the promise or any other person has done or abstained from doing or does or abstains from doing something, such act abstinence or promise is called a consideration for the promisor.”
Consideration is based on the term ‘quid-pro-quo’ which means ‘something in return’. When a person makes a promise to other, he does so with an intention to get some benefit from him. This act to do or to refrain from doing something is known as consideration.
Consideration is an advantage or benefit which moves from one party to another. It is the essence of bargain. It is the reciprocal promise i.e. to do something or abstain from doing something in return of a promise. It is necessary for an agreement to be enforceable by law. In consideration both the parties give something & get something in return. It may be in cash or kind.
The following are the rules related to the valid consideration
(i) Consideration must move at the desire of promisor. If it is done at the instance of a third party without the desire of the promisor, it is not consideration. Act done at the desire of a third party is not a consideration. Act must be done voluntarily at the desire of the promisor.
(ii) It may move from the Promisee or any other person in the Indian Law so that a stranger to the consideration may maintain a suit. A consideration may move from the promise or any other person. Consideration from a third party is a valid consideration. Under English Law, however, consideration must move from the Promisee only.
(iii) Consideration may be past, present or future. The words used in Section 2(d) are “has done or abstained from doing (past), or does or abstains from doing (present), or promises to do or to abstain from doing (future) something” This means consideration may be past, present or future.
(iv) It must be real & not illusory, infinite or vague. Although consideration need not be adequate, it must be real, competent and of some value in the eye of law. Physical impossibility, legal impossibility, uncertain consideration & illusory consideration.
(v) Consideration must not be unlawful, illegal, immoral or opposed to public policy. The consideration given for an agreement must not be unlawful. Where it is unlawful, the courts do not allow an action on the agreement.
(vi) Consideration need not be adequate. Consideration as already explained means “something in return”. This “something given”. The law simply provides that a contract should be supported by consideration. So long as consideration exists, the courts are not concerned as to its adequacy, provided it is of some value. “The adequacy of the consideration is for the parties to consider at the time of making the agreement, not for the court when it is sought to be enforced.”
5. What is meant by delivery of goods? What are the rules relating to delivery of goods? (20)
Ans: Delivery of Goods: Section 33 provides that the delivery of goods sold may be made
a) By doing anything which the parties agree; or
b) Which has the effect of putting the goods in the possession of the buyer or of any person authorized to hold them on his behalf;
Section 35 provides that the seller of goods is not bound to deliver them until the buyer applies for the delivery apart from any express contract.
Rules as to delivery: Rules for the delivery as detailed below:
a. Part delivery: A delivery of part of goods, in progress of the delivery of the whole, has the same effect as a delivery of the whole for the purpose of passing the property in such goods. If a delivery of part of the goods is done with an intention of severing it from the whole, then it does not operate as a delivery of the reminder.
b. Place of delivery:In the absence of an agreement, express or implied, the goods sold are to be delivered at the place at which they are at the time of sale. The goods agreed to be sold are to be delivered at the place at which they are at the time of the agreement to sell, or if not then in existence, at the place at which they are manufactured or produced.
c. Time of Delivery: Where under the contract of sale the seller is bound to send the goods to the buyer, but no time for sending them is fixed, the seller is bound to send them within a reasonable time.
d. Delivery by third party: Where the goods at the time of sale are in the possession of a third person, there is no delivery by seller to buyer unless until such third person acknowledges to the buyer that he holds the goods on his behalf.
e. Expenses on delivery: Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state shall be borne by the seller.
f. Delivery of wrong quantity: The transfer of goods, in a sale, is expected to be delivered as agreed to in the contract. If there is variation in the quantity of goods delivered, the buyer may reject the whole or accept the part of the goods delivered and reject the rest. If the buyer accepts the goods so delivered, he shall pay for them at the contract rate;
g. Installment deliveries: The buyer of the goods is not bound to accept the delivery of goods by installments unless otherwise agreed to between both the parties.
h. Delivery to carrier or wharfingers: If the seller is authorized or required to send the goods to the buyer, through a carrier whether it is named by the buyer or not or delivery of the goods to a wharfinger for safe custody, the delivery of goods to such a carrier or wharfinger shall be deemed to be a delivery of the goods to the buyer.
Visit Official Webiste for Assignment Question Papers