19 November 2014
As a rule, the property in the goods can be transferred from the seller to the buyer, if the goods are either specific or ascertained. In addition to this, for passing the property to the buyer form seller, the seller should not have reserved his right of disposal of the goods. A seller reserves the right of disposal of the goods till the fulfillment of certain conditions. For example, if according to a term of a contract the buyer is to make payment of price of the goods before delivery, it means the seller has reserved the right of disposal of the goods. In this case the property in the shall not pass to the buyer until the condition of payment of price of goods is fulfilled. The position will remain the same even if he goods have been delivered to the buyer or to a baille or carrier of goods for the purpose of carrying to the buyer.
A through there can be express reservation of the right of disposal of goods by the seller, he is deemed to reserve the right of disposal of goods in the following cases.
(1) In case the goods are handed over for shipment or carriage by railway and if the goods are deliverable to the order of the seller or his agent as per the bill of lading or railway receipt.
(2) In case the seller sends a bill of exchange for the amount of the price of the goods to the buyer, along with the bill of lading or railway receipt, for his acceptance. In this case, the property in the goods does not pass from the seller to the buyer till the acceptance of the bill of exchange by the buyer. In case the buyer does not accept the bill or dishonours the bill, the buyer must return the bill of lading or railway receipt; if he retains them wrongfully; the property in the goods does not pass to the buyer.
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