Contarct Of Sale – Essentials of Contract of Sale

What Is Contract Of Sale?

According to section 4 of Sale Of Goods Act 1930, contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to a buyer for price. A contract of sale consists of 2 aspects:

  1. Absolute Sale
  2. Agreement to Sale

What Is Absolute Sale?

The sale where ownership of goods is immediately transferred from the seller to the buyer and nothing is left with the seller is known as absolute sale.

What Is Agreement to Sale?

The sale where the possession of goods transferred from seller to the buyer but the ownership will be transferred in future is known as agreement to sale.

What are the Essentials of Contract of Sale

The following essentials must be present in order to make a contract of sale valid.


The word contract means an agreement enforceable at law, so the parties involved in sale must agree to make a contract lawfully valid.

Two parties involved

The contract of sale requires the presence of two persons, that is buyer and seller because a single person cannot purchase or sell his own goods.

Transfer of the property

A contract of sale requires the transfer of property in goods from the seller to buyer. It involves the transfer of the ownership in the goods.


A contract of sale is not valid if there is no money consideration. Under this contract the seller must get the price of the commodity as consideration.


The subject matter of a contract of sale of goods. The goods are the commodity in which the ownership of property is transferred from seller to the buyer.

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