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        VAT and Sales Tax

        1935 (7) TMI 22 - HC - VAT and Sales Tax

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        Intention governs passing of property in specific goods; payment transferred title without prior measurement. Under Section 19 of the Sale of Goods Act, title in specific or ascertained goods passes according to the parties' intention, while Section 22 creates ...
                        Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                          Provisions expressly mentioned in the judgment/order text.

                              Intention governs passing of property in specific goods; payment transferred title without prior measurement.

                              Under Section 19 of the Sale of Goods Act, title in specific or ascertained goods passes according to the parties' intention, while Section 22 creates only a prima facie rule where the seller must do an act to ascertain price. Here, the contracts fixed the quantity and rate, the balance price was paid without any further act by the sellers, and the surrounding circumstances showed that ownership was intended to pass on payment. Measurement was therefore only for the buyer's satisfaction and did not postpone transfer. The buyer's title had already passed, so subsequent attachments and insolvency adjudication could not defeat it.




                              Issues: Whether, on payment of the balance price for specific goods in a deliverable state, the property in the goods passed to the buyer on 5 July 1930, or whether it remained untransferred until measurement of the goods was completed.

                              Analysis: Under Section 19 of the Indian Sale of Goods Act, III of 1930, the decisive factor is the intention of the parties where the contract concerns specific or ascertained goods. Section 22 furnishes only a prima facie rule for cases where the seller must weigh, measure, test, or do some other act to ascertain the price. The contracts here fixed the quantity and rate, and the balance price was calculated and paid without any further act being required of the sellers. The surrounding circumstances showed that the parties intended ownership to pass on payment, and any measurement was only for the buyer's satisfaction as to quantity and price already due.

                              Conclusion: The property in the paddy passed to the appellant on payment of the balance price, and it did not depend on prior measurement. The attachments and the adjudication in insolvency could not defeat the appellant's title.


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                              ActsIncome Tax
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