Sale & Agreement to Sale Section 4 of the Sales of Goods Act defines the term ‘Sale’ and ‘Agreement to Sale’. Firstly the Section states that ‘a contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price.’ The above explanation pertains with it some certain features of a sale those are: 1. Bilateral Contract: A sale has to be bilateral because the property in goods has to pass from one person to another. Its first essential, therefore, is that the seller and the buyer must be different persons. A sale is said to be consensual because it is necessary that the parties should agree with their free consent. In Graff V. Evans, the accused was the manager of a club. The club was not licensed for the sale of intoxicating liquors, but these were supplied by the manager to the members at fixed prices. This was held to be not a sale within the meaning of licensing Acts. It was merely a distribution of the liquors among the members, they being the joint owners of the club. But if the club were an incorporated body, the result would perhaps have been different. Sometimes a contract may not be entered into by the normal process of negotiation, but under a statutory compulsion. When the goods are supplied under a statutory compulsion whether that results in sale or not. In Vishnu Agencies V. Commercial Tax Officer, it was held that the transaction of supply of cement by a distributor to a permit-holder, in terms of the provisions of West Beng al Cement Control Act and control Order, amounts to ‘sale’ and thus eligible to sales tax. The appellant contended that no volition or free will or bargaining power was left to i t, and since there was no element of mutual consent or agreement between it and the allottees, the transactions were not sales within the meaning of Sales Tax Act. The court observed that the offer and acceptance need not always be in an elementary form, nor indeed does the Law of Contract or of Sale of goods require that the consent to a contract must be ex press, it may be implied and can be spelt out from the conduct of the parties. In the first place, it is not obligatory on a trader to deal in cement nor on anyone to acquire it. The decision of trader to deal in an essential commodity is volitional. Such volition carries with it the willingness to trade in the commodity strictly on the terms of Control Order. The consumer too, who is under no legal compulsion to acquire or possess cement, decided as a matter of his volition to obtain it on the terms of permit or the order of allotment issued in his favour. Thus, though both parties are bound to comply with the legal requirements governing the transaction they agree as between themselves to enter into transaction on agreeing to supply on statutory terms and other agreeing to accept it on the very terms. Thus, transaction between them, is ‘consensual’ or with their ‘free consent’ Also, there is some scope for the parties to bargain. The Cement Control Order provides that no person shall sell cement at a “higher than notified price”, leaving it open to parties to charge and pay a price which is less than the notified price. In another case of Coffee Board, Karnataka V. Commissioner of Commercial Taxes, it was held that the compulsory delivery of coffee by the coffee growers to the Coffee Board constitutes a sale and not compulsory acquisition, and the State can impose Purchase tax on the same. 2. Money Consideration: The consideration for a sale of goods must be money, called the price. Where the property in goods is transferred for any consideration other than money that will not be sale, but an exchange or barter. But where goods are sold for a definite sum and the price is paid
