45. “Unpaid seller” defined.—
(1) The seller of goods is deemed to be an “unpaid seller” within the
meaning of this Act—
(a) when the whole of the price has not been paid or tendered;
(b) when a bill of exchange or other negotiable instrument has been received as conditional
payment, and the condition on which it was received has not been fulfilled by reason of the dishonour
of the instrument or otherwise.
(2) In this Chapter, the term “seller” includes any person who is in the position of a seller, as, for
instance, an agent of the seller to whom the bill of lading has been endorsed, or a consignor or agent who
has himself paid, or is directly responsible for, the price.
46. Unpaid seller’s sights.—
(1) Subject to the provisions of this Act and of any law for the time
being in force, notwithstanding that the property in the goods may have passed to the buyer, the unpaid
seller of goods, as such, has by implication of law—
(a) a lien on the goods for the price while he is in possession of them;
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(b) in case of the insolvency of the buyer a right of stopping the goods in transit after he has
parted with the possession of them;
(c) a right of re-sale as limited by this Act.
(2) Where the property in goods has not passed to the buyer, the unpaid seller has, in addition to his
other remedies, a right of withholding delivery similar to and co-extensive with his rights of lien and
stoppage in transit where the property has passed to the buyer.
Unpaid seller’s lien
47. Seller’s lien.—
(1) Subject to the provisions of this Act, the unpaid seller of goods who is in
possession of them is entitled to retain possession of them until payment or tender of the price in the
following cases, namely:—
(a) where the goods have been sold without any stipulation as to credit;
(b) where the goods have been sold on credit, but the term of credit has expired;
(c) where the buyer becomes insolvent.
(2) The seller may exercise his right of lien notwithstanding that he is in possession of the goods as
agent or bailee for the buyer.
48. Part delivery.—Where an unpaid seller has made part delivery of the goods, he may exercise his
right of lien on the remainder, unless such part delivery has been made under such circumstances as to
show an agreement to waive the lien.
49. Termination of lien.—
(1) The unpaid seller of goods loses his lien thereon—
(a) when he delivers the goods to a carrier or other bailee for the purpose of transmission to the
buyer without reserving the right of disposal of the goods;
(b) when the buyer or his agent lawfully obtains possession of the goods;
(c) by waiver thereof.
(2) The unpaid seller of goods, having a lien thereon, does not lose his lien by reason only that he has
obtained a decree for the price of the goods.
Stoppage in transit
50. Right of stoppage in transit.—Subject to the provisions of this Act, when the buyer of goods
becomes insolvent, the unpaid seller who has parted with the possession of the goods has the right of
stopping them in transit, that is to say, he may resume possession of the goods as long as they are in the
course of transit, and may retain them until payment or tender of the price.
51. Duration of transit.—
(1) Goods are deemed to be in course of transit from the time when they
are delivered to a carrier or other bailee for the purpose of transmission to the buyer, until the buyer or his
agent in that behalf takes delivery of them from such carrier or other bailee.
(2) If the buyer or his agent in that behalf obtains delivery of the goods before their arrival at the
appointed destination, the transit is at an end.
(3) If, after the arrival of the goods at the appointed destination, the carrier or other bailee
acknowledges to the buyer or his agent that he holds the goods on his behalf and continues in possession
of them as bailee for the buyer or his agent, the transit is at an end and it is immaterial that a further
destination for the goods may have been indicated by the buyer.
(4) If the goods are rejected by the buyer and the carrier or other bailee continues in possession of
them, the transit is not deemed to be at an end, even if the seller has refused to receive them back.
(5) When goods are delivered to a ship chartered by the buyer, it is a question depending on the
circumstances of the particular case, whether they are in the possession of the master as a carrier or as
agent of the buyer.
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(6) Where the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent
in that behalf, the transit is deemed to be at an end.
(7) Where part delivery of the goods has been made to the buyer or his agent in that behalf, the
remainder of the goods may be stopped in transit, unless such part delivery has been given in such
circumstances as to show an agreement to give up possession of the whole of the goods.
52. How stoppage in transit is effected.—
(1) The unpaid sellermay exercise his right of stoppage in
transit either by taking actual possession of the goods, or by giving notice of his claim to the carrier or
other bailee in whose possession the goods are. Such notice may be given either to the person in actual
possession of the goods or to his principal. In the latter case the notice, to be effectual, shall be given at
such time and in such circumstances that the principal, by the exercise of reasonable diligence, may
communicate it to his servant or agent in time to prevent a delivery to the buyer.
(2) When notice of stoppage in transit is given by the seller to the carrier or other bailee in possession
of the goods, he shall re-deliver the goods to, or according to the directions of, the seller. The expenses of
such re-delivery shall be borne by the seller.
Transfer by buyer and seller
53. Effect of sub-sale or pledge by buyer.—
(1) Subject to the provisions of this Act, the unpaid
seller’s right of lien or stoppage in transit is not affected by any sale or other disposition of the goods
which the buyer may have made, unless the seller has assented thereto:
Provided that where a document of title to goods has been issued or lawfully transferred to any person
as buyer or owner of the goods, and that person transfers the document to a person who takes the
document in good faith and for consideration, then, if such last mentioned transfer was by way a sale, the
unpaid seller’s right of lien or stoppage in transit is defeated, and, if such last mentioned transfer was by
way of pledge or other disposition for value, the unpaid seller’s right of lien or stoppage is transit can
only be exercised subject to the rights of the transferee.
(2) Where the transfer is by way of pledge, the unpaid seller may require the pledgee to have the
amount secured by the pledge satisfied in the first instance, as far as possible, out of any other goods or
securities of the buyer in the hands of the pledgee and available against the buyer
54. Sale not generally rescinded by lien or stoppage in transit.—
(1) Subject to the provisions of
this section, a contract of sale is not rescinded by the mere exercise by an unpaid seller of his right of lien
or stoppage in transit.
(2) Where the goods are of a perishable nature, or where the unpaid seller who has exercised his right
of lien or stoppage in transit gives notice to the buyer of his intention to re-sell, the unpaid seller may, if
the buyer does not within a reasonable time pay or tender the price, re-sell the goods within a reasonable
time and recover from the original buyer damages for any loss occasioned by his breach of contract, but
the buyer shall not be entitled to any profit which may occur on the re-sale. If such notice is not given, the
unpaid seller shall not be entitled to recover such damages and the buyer shall be entitled to the profit, if
any, on the re-sale.
(3) Where an unpaid seller who has exercised his right of lien or stoppage in transit re-sells the goods,
the buyer acquires a good title thereto as against the original buyer, notwithstanding that no notice of the
re-sale has been given to the original buyer.
(4) Where the seller expressly reserves a right of re-sale in case the buyer should make default, and,
on the buyer making default, re-sells the goods, the original contract of sale is thereby rescinded, but
without prejudice to any claim which the seller may have for damages.
CHAPTER VI
SUITS FOR BREACH OF THE CONTRACT
55. Suit for price.—
(1) Where under a contract of sale the property in the goods has passed to the
buyer and the buyer wrongfully neglects or refuses to pay for the goods according to the terms of the
contract, the seller may sue him for the price of the goods.
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(2) Where under a contract of sale the price is payable on a day certain irrespective of delivery and
the buyer wrongfully neglects or refuses to pay such pirce, the seller may sue him for the price although
the property in the goods has not passed and the goods have not been appropriated to the contract.
56. Damages for non-acceptance.—Where the buyer wrongfully neglects or refuses to accept and
pay for the goods, the seller may sue him for damages for non-acceptance.
57. Damages for non-delivery.—Where the seller wrongfully neglects or refuses to deliver the
goods to the buyer, the buyer may sue the seller for damages for non-delivery.
58. Specific performance.—Subject to the provisions of Chapter II of the Specific Relief Act, 1877
(1 of 1877), in any suit for breach of contract to deliver specific or ascertained goods, the Court may, if it
thinks fit, on the application of the plaintiff, by its decree direct that the contract shall be performed
specifically, without giving the defendant the option of retaining the goods on payment of damages. The
decree may be unconditional, or upon such terms and conditions as to damages, payment of the price or
otherwise, as the Court may deem just, and the application of the plaintiff may be made at any time before
the decree.
59. Remedy for breach of warranty.—
(1) Where there is a breach of warranty by file seller, or
where the buyer elects or is compelled to treat any breach of a condition on the part of the seller as a
breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods;
but he may—
(a) set up against the seller the breach of warranty in diminution or extinction of the price; or
(b) sue the seller for damages for breach of warranty.
(2) The fact that a buyer has set up a breach of warranty in diminution or extinction of the price does
not prevent him from suing for the same breach of warranty if he has suffered further damage.
60. Repudiation of contract before due date.—Where either party to a contract of sale repudiates
the contract before the date of delivery, the other may either treat the contract as subsisting and wait till
the date of delivery, or he may treat the contract as rescinded and sue for damages for the breach.
61. Interest by way of damages and special damages.—
(1) Nothing in this Act shall affect the right
of the seller or the buyer to recover interest or special damages in any case where by law interest or
special damages may be recoverable, or to recover the money paid where the consideration for the
payment of it has failed.
(2) In the absence of a contract to the contrary, the Court may award interest at such rate as it thinks
fit on the amount of the price—
(a) to the seller in a suit by him for the amount of the price— from the date of the tender of the
goods or from the date on which the price was payable;
(b) to the buyer in a suit by him for the refund of the price in a case of a breach of the contract on
the part of the seller—from the date on which the payment was made.
CHAPTER VII
MISCELLANEOUS
62. Exclusion of implied terms and conditions.—Where any right, duty or liability would arise
under a contract of sale by implication of law, it may be negatived or varied by express agreement or by
the course of dealing between the parties, or by usage, if the usage is such as to bind both parties to the
contract.
63. Reasonable time a question of fact.—Where in this Act any reference is made to a reasonable
time, the question what is a reasonable time is a question of fact.
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64. Auction sale. —In the case of a sale by auction—
(1) Where goods are put up for sale in lots, each lot is prima facie deemed to be the subject of a
separate contract of sale;
(2) the sale is complete when the auctioneer announces its completion by the fall of the hammer
or in other customary manner; and, until such announcement is made, any bidder may retract his bid;
(3) a right to bid may be reserved expressely by or on behalf of the seller and, where such right is
expressly so reserved, but not otherwise, the seller or any one person on his behalf may, subject to the
provisions hereinafter contained, bid at the auction;
(4) where the sale is not notified to be subject to a right to bid on behalf of the seller, it shall not
be lawful for the seller to bid himself or to employ any person to bid at such sale, or for the auctioneer
knowingly to take any bid from the seller or any such person; and any sale contravening this rule may
be treated as fraudulent by the buyer;
(5) the sale may be notified to be subject to a reserved or upset, price;
(6) if the seller makes use of pretended bidding to raise the price, the sale is voidable at the option
of the buyer.
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[64A. In contracts of sale, amount of increased or decreased taxes to be added or deducted.—
(1) Unless a different intention appears from the terms of the contract, in the event of any tax of the nature
described in sub-section
(2) being imposed, increased, decreased or remitted in respect of any goods after
the making of any contract for the sale or purchase of such goods without stipulation as to the payment of
tax where tax was not chargeable at the time of the making of the contract, or for the sale or purchase of
such goods tax-paid where tax was chargeable at that time,—
(a) if such imposition or increase so takes effect that the tax or increased tax, as the case may be,
or any part of such tax is paid or is payable, the seller may add so much to the contract price as will
be equivalent to the amount paid or payable in respect of such tax or increase of tax, and he shall be
entitled to be paid and to sue for and recover such addition; and
(b) if such decrease or remission so takes effect that the decreased tax only, or no tax, as the case
may be, is paid or is payable, the buyer may deduct so much from the contract price as will be
equivalent to the decrease of tax or remitted tax, and he shall not be liable to pay, or be sued for, or in
respect of, such deduction.
(2) The provisions of sub-section
(1) apply to the following taxes, namely:—
(a) any duty of customs or excise on goods;
(b) any tax on the sale or purchase of goods.]
65. [Repeal.] Rep. by the Repealing Act, 1938 (1 of 1938), s. 2 and Sch.
66. Savings.—
(1) Nothing in this Act or in any repeal effected thereby shall affect or be deemed to
affect—
(a) any right, title, interest, obligation or liability already acquired, accrued or incurred before the
commencement of this Act, or
(b) any legal proceedings or remedy in respect of any such right, title, interest, obligation or
liability, or
(c) anything done or suffered before the commencement of this Act, or
(d) any enactment relating to the sale of goods which is not expressly repealed by this Act, or
(e) any rule of law not inconsistent with this Act.
1. Subs. by Act 33 of 1963, s. 5, for section 64A (w.e.f. 22-9-1963). Earlier it was inserted by Act 41 of 1940, s 2.
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(2) The rules of insolvency relating to contracts for the sale of goods shall continue to apply thereto,
notwithstanding anything contained in this Act.
(3) The provisions of this Act relating to contracts of sale do not apply to any transaction in the form
of a contract of sale which is intended to operate by way of mortgage, pledge, charge or other security.
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