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Sale of Goods Act MCQs for CLAT PG

CLAT PG Sale of Goods Act questions 1-25 of 25, with answer keys and explanations covering conditions, warranties, transfer of property, delivery, unpaid seller rights, auction sales, and buyer remedies.

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Revise core LLB subjects through CLAT PG MCQs, passage-led questions, answer keys, explanations, statutes, and exam-oriented legal principles.

  • Conditions, Warranties, and Caveat Emptor5
  • Delivery, Acceptance, Unpaid Seller, and Remedies5
  • Formation of Contract of Sale and Classification of Goods5
  • Nemo Dat and Exceptions to Transfer of Title5
  • Passing of Property and Risk5
Passage or principleSale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

The Sale of Goods Act, 1930 separates contracts of sale of goods from neighbouring transactions such as barter, bailment, hire-purchase, and contracts for work and labour. Section 4 defines a contract of sale as a contract by which the seller transfers or agrees to transfer property in goods to the buyer for a price. The requirement of price is important because price means money consideration; a pure exchange of goods for goods is not a sale under the Act. The subject matter must be goods, which means movable property other than actionable claims and money, but includes stocks, shares, growing crops, grass, and things attached to land which are agreed to be severed before sale or under the contract of sale. The Act also classifies goods as existing, future, contingent, specific, ascertained, and unascertained. These classifications are not merely theoretical. They determine when property can pass, what happens if goods perish, and what remedies remain if performance fails.

Question 1EasyFormation of Contract of Sale and Classification of Goods

According to the passage, a pure exchange of goods for goods is not a sale because:

  1. A

    There is no money consideration or price

  2. B

    Goods cannot be movable property

  3. C

    Exchange is always illegal

  4. D

    Delivery is absent in every exchange

View answer and explanation

Correct answer: A. There is no money consideration or price

The passage states that price means money consideration. Without price, a pure exchange is barter, not sale under Section 4.

Source note: Sale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

Question 2EasyFormation of Contract of Sale and Classification of Goods

Which item is expressly included in the statutory idea of goods as described in the passage?

  1. A

    Money as legal tender

  2. B

    Stocks and shares

  3. C

    Pure professional services

  4. D

    Actionable claims

View answer and explanation

Correct answer: B. Stocks and shares

The passage follows Section 2(7), which includes stocks and shares but excludes actionable claims and money.

Source note: Sale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

Question 3MediumFormation of Contract of Sale and Classification of Goods

Why does the classification of goods matter under the Act?

  1. A

    It applies only to immovable property

  2. B

    It replaces all contract-law principles

  3. C

    It determines issues such as passing of property, perishing of goods, and available remedies

  4. D

    It decides criminal punishment for seller

View answer and explanation

Correct answer: C. It determines issues such as passing of property, perishing of goods, and available remedies

The passage directly links classification to property, risk of perishing, and remedies.

Source note: Sale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

Question 4MediumFormation of Contract of Sale and Classification of Goods

A contract to sell apples to be grown next season is best described as involving:

  1. A

    Actionable claims

  2. B

    Existing specific goods

  3. C

    Future goods

  4. D

    Money

View answer and explanation

Correct answer: C. Future goods

Goods to be produced after the contract are future goods.

Source note: Sale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

Question 5MediumFormation of Contract of Sale and Classification of Goods

The passage most strongly suggests that the Sale of Goods Act applies when the dominant legal object is:

  1. A

    Transfer or agreement to transfer property in goods for price

  2. B

    Performance of any service for reward

  3. C

    Transfer of land by registered deed

  4. D

    Creation of partnership between traders

View answer and explanation

Correct answer: A. Transfer or agreement to transfer property in goods for price

The defining object under Section 4 is transfer or agreement to transfer property in goods for a price.

Source note: Sale of Goods Act, 1930, Sections 1-10 / JK Shah SOGA Notes

Passage or principleSale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

The Act distinguishes between conditions and warranties. A condition is a stipulation essential to the main purpose of the contract, while a warranty is collateral to that purpose. The remedy differs: breach of condition normally allows rejection and damages, while breach of warranty normally leads to damages or reduction of price. However, Section 13 permits a buyer to waive a condition or elect to treat its breach as a breach of warranty; in some accepted-goods situations, the law itself restricts the buyer to warranty-type remedies. The doctrine of caveat emptor remains the starting point: the buyer must beware. But Section 16 creates important exceptions. If the buyer makes a particular purpose known and relies on the seller skill or judgment, an implied condition of fitness may arise. If goods are bought by description from a seller dealing in goods of that description, merchantable quality may be implied, subject to defects that examination ought to reveal. Cases such as Grant v. Australian Knitting Mills illustrate the practical force of implied fitness and quality obligations in consumer-facing sales.

Question 6EasyConditions, Warranties, and Caveat Emptor

The main difference between a condition and a warranty lies in:

  1. A

    The importance of the stipulation to the main purpose and the remedy for breach

  2. B

    Whether the term is oral or written

  3. C

    Whether the buyer has paid in advance

  4. D

    Whether the goods are future goods

View answer and explanation

Correct answer: A. The importance of the stipulation to the main purpose and the remedy for breach

The passage states that conditions are essential to the main purpose, while warranties are collateral; the remedy differs accordingly.

Source note: Sale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

Question 7MediumConditions, Warranties, and Caveat Emptor

Section 13 is important because it allows or requires some breaches of condition to be treated as:

  1. A

    Auction fraud

  2. B

    Criminal breach of trust

  3. C

    Transfer of title

  4. D

    Breach of warranty

View answer and explanation

Correct answer: D. Breach of warranty

The passage explains that a buyer may waive a condition or treat breach as warranty, and accepted-goods cases may restrict remedies.

Source note: Sale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

Question 8EasyConditions, Warranties, and Caveat Emptor

The doctrine of caveat emptor is best understood as:

  1. A

    Buyer never has remedies

  2. B

    Goods always pass at buyer risk before contract

  3. C

    Buyer beware, subject to statutory and contractual exceptions

  4. D

    Seller always liable for every defect

View answer and explanation

Correct answer: C. Buyer beware, subject to statutory and contractual exceptions

The passage describes caveat emptor as the starting point but immediately notes statutory exceptions under Section 16.

Source note: Sale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

Question 9MediumConditions, Warranties, and Caveat Emptor

An implied condition of fitness for purpose is most likely when:

  1. A

    The buyer refuses all inspection

  2. B

    The buyer makes the purpose known and relies on seller skill or judgment

  3. C

    The buyer relies only on a patent name

  4. D

    The seller is unpaid

View answer and explanation

Correct answer: B. The buyer makes the purpose known and relies on seller skill or judgment

Section 16(1), as described in the passage, requires purpose and reliance.

Source note: Sale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

Question 10HardConditions, Warranties, and Caveat Emptor

Grant v. Australian Knitting Mills is used in the passage to illustrate:

  1. A

    The practical role of implied fitness and quality obligations

  2. B

    The end of all buyer duties

  3. C

    The rule that auction sales are void

  4. D

    The definition of money

View answer and explanation

Correct answer: A. The practical role of implied fitness and quality obligations

The case is cited as an illustration of implied fitness and quality in consumer-facing sales.

Source note: Sale of Goods Act, 1930, Sections 12-17 / Grant v. Australian Knitting Mills

Passage or principleSale of Goods Act, 1930, Sections 18-26

The passing of property is central to the Act because it determines ownership and often risk. Section 19 makes the intention of the parties decisive for specific or ascertained goods, and that intention is gathered from the terms of the contract, conduct of parties, and circumstances of the case. Where intention is not clear, statutory rules apply. Under Section 20, in an unconditional contract for specific goods in a deliverable state, property passes when the contract is made, even if payment or delivery is postponed. Sections 21 and 22 postpone transfer where the seller must do something to put goods into a deliverable state or to ascertain price, and the buyer must have notice. For unascertained goods, Section 18 prevents property from passing until goods are ascertained, while Section 23 requires unconditional appropriation with assent. Section 26 states the prima facie rule that risk follows property, but this is subject to contrary agreement and fault-based exceptions.

Question 11EasyPassing of Property and Risk

Under Section 19, the key test for passing of property in specific or ascertained goods is:

  1. A

    Intention of the parties

  2. B

    Always actual delivery

  3. C

    Always payment of full price

  4. D

    Registration before court

View answer and explanation

Correct answer: A. Intention of the parties

The passage states that intention is decisive under Section 19.

Source note: Sale of Goods Act, 1930, Sections 18-26

Question 12MediumPassing of Property and Risk

Under Section 20, property in specific goods in deliverable state passes:

  1. A

    Only after the buyer inspects

  2. B

    Only after payment

  3. C

    Only after delivery

  4. D

    When the unconditional contract is made

View answer and explanation

Correct answer: D. When the unconditional contract is made

Section 20 makes payment and delivery postponement immaterial if the contract is unconditional and goods are specific and deliverable.

Source note: Sale of Goods Act, 1930, Sections 18-26

Question 13MediumPassing of Property and Risk

Sections 21 and 22 require notice to buyer because:

  1. A

    Notice replaces price

  2. B

    Notice converts sale into bailment

  3. C

    The buyer must know the act delaying transfer has been completed

  4. D

    Notice makes goods movable

View answer and explanation

Correct answer: C. The buyer must know the act delaying transfer has been completed

The passage says transfer is postponed until the seller act is done and buyer has notice.

Source note: Sale of Goods Act, 1930, Sections 18-26

Question 14MediumPassing of Property and Risk

For unascertained goods, property cannot pass until:

  1. A

    A third party fixes damages

  2. B

    Goods are ascertained and appropriated according to law

  3. C

    The buyer becomes insolvent

  4. D

    The seller prints invoice

View answer and explanation

Correct answer: B. Goods are ascertained and appropriated according to law

Sections 18 and 23 control unascertained goods: ascertainment and appropriation are necessary.

Source note: Sale of Goods Act, 1930, Sections 18-26

Question 15HardPassing of Property and Risk

The statement "risk follows property" is:

  1. A

    A prima facie rule subject to agreement and fault exceptions

  2. B

    An absolute rule without exceptions

  3. C

    A rule only for land

  4. D

    A rule only for criminal cases

View answer and explanation

Correct answer: A. A prima facie rule subject to agreement and fault exceptions

Section 26 creates a prima facie rule, but parties may agree otherwise and fault can affect risk.

Source note: Sale of Goods Act, 1930, Sections 18-26

Passage or principleSale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Section 27 embodies the nemo dat rule: no one can transfer a better title than he himself has. This protects ownership, but commercial law cannot ignore market reliance on possession and apparent authority. Therefore, the Act recognises limited exceptions. If the true owner is precluded by conduct from denying the seller authority, estoppel may operate. A mercantile agent in possession with the owner consent may pass good title when selling in the ordinary course of business to a buyer acting in good faith without notice. Section 28 protects buyers from one joint owner in sole possession with permission of co-owners. Section 29 protects a buyer from a seller in possession under a voidable contract, provided the contract has not been rescinded and the buyer acts in good faith without notice. Section 30 protects bona fide buyers from a seller or buyer who remains or comes into possession of goods or documents of title in circumstances specified by the Act. These exceptions are narrow: a thief generally cannot pass title.

Question 16EasyNemo Dat and Exceptions to Transfer of Title

The nemo dat rule means:

  1. A

    No one can transfer better title than he has

  2. B

    Every possessor is owner

  3. C

    Every sale by agent is void

  4. D

    Every buyer must inspect goods

View answer and explanation

Correct answer: A. No one can transfer better title than he has

The passage defines nemo dat exactly in those terms.

Source note: Sale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Question 17MediumNemo Dat and Exceptions to Transfer of Title

Why does the Act recognise exceptions to nemo dat?

  1. A

    To abolish ownership

  2. B

    To protect thieves

  3. C

    To make all sales final

  4. D

    To balance ownership protection with commercial reliance on possession and apparent authority

View answer and explanation

Correct answer: D. To balance ownership protection with commercial reliance on possession and apparent authority

The passage explains the policy balance behind the exceptions.

Source note: Sale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Question 18MediumNemo Dat and Exceptions to Transfer of Title

A mercantile agent exception requires the buyer to act:

  1. A

    Without paying price

  2. B

    After theft

  3. C

    In good faith without notice of lack of authority

  4. D

    With notice of owner objection

View answer and explanation

Correct answer: C. In good faith without notice of lack of authority

The passage states good faith and absence of notice as requirements.

Source note: Sale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Question 19MediumNemo Dat and Exceptions to Transfer of Title

Section 29 applies where the seller has:

  1. A

    A criminal conviction

  2. B

    Voidable title not yet rescinded

  3. C

    No title because of theft

  4. D

    Only a service contract

View answer and explanation

Correct answer: B. Voidable title not yet rescinded

The passage distinguishes voidable title from theft or no-title situations.

Source note: Sale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Question 20HardNemo Dat and Exceptions to Transfer of Title

Which statement best reflects the limits of the exceptions?

  1. A

    They are narrow and generally do not allow a thief to pass title

  2. B

    They make every possessor owner

  3. C

    They apply only to immovable property

  4. D

    They abolish the requirement of good faith

View answer and explanation

Correct answer: A. They are narrow and generally do not allow a thief to pass title

The passage closes by noting that the exceptions are narrow and a thief generally cannot pass title.

Source note: Sale of Goods Act, 1930, Sections 27-30 / Indian Contract Act, Section 178

Passage or principleSale of Goods Act, 1930, Sections 31-64

The performance provisions of the Act are practical. Section 31 states the reciprocal duties: the seller must deliver goods and the buyer must accept and pay according to the contract. Unless otherwise agreed, payment and delivery are concurrent conditions. Delivery may be actual, symbolic, or constructive. The Act regulates wrong quantity, instalment delivery, delivery to carrier, examination, acceptance, and rejection. A buyer may be deemed to accept goods by intimating acceptance, acting inconsistently with the seller ownership, or retaining goods beyond reasonable time. The unpaid seller provisions create a powerful remedial structure. An unpaid seller may have lien, stoppage in transit, and resale rights against the goods, along with personal actions for price or damages. Stoppage in transit is available when the buyer becomes insolvent while goods are still in transit. Auction sales are separately regulated: each lot is prima facie a separate contract, sale completes on fall of hammer or customary announcement, and undisclosed seller bidding may make the sale fraudulent.

Question 21EasyDelivery, Acceptance, Unpaid Seller, and Remedies

Payment and delivery are described as concurrent conditions unless:

  1. A

    The parties agree otherwise

  2. B

    The seller is unpaid

  3. C

    The goods are specific

  4. D

    The buyer inspects goods

View answer and explanation

Correct answer: A. The parties agree otherwise

The passage follows Section 32: payment and delivery are concurrent unless otherwise agreed.

Source note: Sale of Goods Act, 1930, Sections 31-64

Question 22MediumDelivery, Acceptance, Unpaid Seller, and Remedies

A buyer may be deemed to accept goods by:

  1. A

    Merely asking for inspection

  2. B

    Rejecting goods immediately

  3. C

    Refusing all delivery

  4. D

    Acting inconsistently with seller ownership

View answer and explanation

Correct answer: D. Acting inconsistently with seller ownership

The passage lists inconsistent conduct as one mode of acceptance.

Source note: Sale of Goods Act, 1930, Sections 31-64

Question 23EasyDelivery, Acceptance, Unpaid Seller, and Remedies

Which is a right of an unpaid seller against the goods?

  1. A

    Mandamus

  2. B

    Specific constitutional remedy

  3. C

    Lien

  4. D

    Divorce

View answer and explanation

Correct answer: C. Lien

The passage lists lien, stoppage in transit, and resale as unpaid seller rights against goods.

Source note: Sale of Goods Act, 1930, Sections 31-64

Question 24MediumDelivery, Acceptance, Unpaid Seller, and Remedies

Stoppage in transit is available when:

  1. A

    Seller never had possession

  2. B

    Buyer becomes insolvent while goods are still in transit

  3. C

    Buyer pays full price

  4. D

    Goods are already accepted by buyer without dispute

View answer and explanation

Correct answer: B. Buyer becomes insolvent while goods are still in transit

The passage states the insolvency plus transit requirement.

Source note: Sale of Goods Act, 1930, Sections 31-64

Question 25HardDelivery, Acceptance, Unpaid Seller, and Remedies

In auction sales, undisclosed seller bidding may make the sale:

  1. A

    Fraudulent at the option of the buyer

  2. B

    A contract of bailment

  3. C

    A gift

  4. D

    A criminal trial automatically

View answer and explanation

Correct answer: A. Fraudulent at the option of the buyer

The passage reflects Section 64: undisclosed seller bidding may allow the buyer to treat the sale as fraudulent.

Source note: Sale of Goods Act, 1930, Sections 31-64

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