MCQs

PRELIMINARIES
1. The Sale of Goods Act, 1930 came into force on-
(a) 1 day of July 1930
(b) 1 day of September 1930
(c) 1 day of January 1930
(d) 31 day of December 1930

[Link] are the essential elements of Contract of Sale?

(a) Atleast two Parties
(b) Subject matter must be Goods
(c) Both (a) and (b)
(d) None of these.

3."Delivery" within the meaning of the Sale of Goods Act, can

be –
(a) Symbolic (b) Actual
(c) Constructive (d) either (a) or (b) or (c)

4. Giving keys of godown to buyer is _________ delivery.

(a) Constructive (b) Symbolic
(c) Actual (d) None of the above

5. A Share Certificate is a –
(a) Document of Title to Goods
(b) Bill of Exchange
(c) Document Showing Title to Goods
(d) Instrument of Transfer

6.A document issued by Railway Company acknowledging

receipt of goods is known as -
(a) Bill of Lading (b) Railway Receipt
(c) Dock Warrant (d) None of these.

7. Which of the following are document of title of goods?

(a) Performa invoice (b) Mate's receipt
(c) railway receipt (d) all of above

8. Which of the following is not a document of title to goods?

(a) Bill of lading (b) Railway receipt
(c) Dock warrant (d) Proforma invoice

9. Which of these is NOT a Document of Title to Goods?

(a) Bill of Lading (b) Railway Receipt
(c) Dock Warrant (d) Bearer Cheque
[Link] of the following is not correct in relation to hire
purchase?
(a) The property in goods passes to hirer alongwith
its possession
(b) The hirer is deemed to be a ballee till the payment of last
installment
(c) The hirer can terminate the Contract by returning the
goods.
(d) The hirer cannot transfer any title.

[Link] does not include:

(a) Money and actionable claims (b) Growing Crops
(c) Shares (d) None of the above

12. "Goods" under the Sale of Goods Act, includes -

(a) Money (b) Actionable Claim
(c) Both (a) and (b) (d) Neither (a) nor (b).

13. "Jubilee Coins" are goods within the meaning of Section

2(7) of the Sale of Goods Act.
(a) True (b) Partly True
(c) False (d) None of the above
14. Which of the following is not sale under sale of goods Act,
1930.
(a) purchase of goods by a partner for firm
(b) x agree with y to sell future goods
(c) x sold goods worth 2000 to y
(d) x sold building 100000 to y

15. Under the Sale of Goods Act, 1930, the Seller in a Contract
of Sale transfers the ________ in goods to the buyer for a
Price.
(a) Possession (b) Control
(c) Rights (d) Property

16. Goods sold by description but not identified or agreed upon

at the time of contract of sale are
(a) Specific goods (b) Future goods
(c) Existing goods (d) Unascertained goods.

17. X agrees to sell Y, all crops of wheat to be grown in X farm,

In this case.
(a) It is a contract of sale of present goods.
(b) There is no contract of sale to sell of future goods
(c) It is an agreement
(d) None of the above.
18. X agrees to sell Y, all crops to be grown in X's farm in
Haryana during 2016 season, for 1,00,000. In this case, the
goods are -
(a) Future Goods (b) Specific Goods
(c) Unascertained Goods (d) Contingent Goods

19. Viru agrees to buy the crop of rice that would yield in Y's
farm located in Punjab at the rate of Rupees 2000 per 100 kg.
this deals under the sale of Goods Act, 1930
(a) Agreement for sale of present goods
(b) contract of sale
(c) Agreement for sale of future goods
(d) None of the above An Agreement to Sell in respect of goods
is an

20. _________ contract which creates a jus in personam

(a) Executed. (b) Executory.
(c) Voidable. (d) Void.

21. In an Agreement to Sell, the property in goods is

transferred in-
(a) Past (b) Present
(c) Future (d) There is no transfer of property at all.
22. Where under a contract, the property in goods is
transferred from the Seller to the Buyer, contract is -
(a) called a Sale
(b) called an Agreement to Sell
(c) Voidable at the option of the Buyer
(d) Void ab-initio

23. Which of the following statements is not true?

(a) In an agreement to sell, ownership will be transferred to
buyer
(b) In agreement to sell, loss will be with the seller
(c) Both (a) & (b)
(d) None of the above

24. The Property of goods will be transferred to the buyer at

the time where total payment is made
(a) Sale (b) Agreement to Sell
(c) Hire Purchases (d) Sale / Approval Basis.

25. An Agreement made between two parties to pay

consideration in future and in execution of Sale deed as is
known
(a) Sale (b) Agreement to Sell
(c) Hire Purchase (d) None.
26. In an agreement to sell, where goods lie with the Buyer,
the risk of loss of goods remains with -
(a) Either Buyer or Seller
(b) Buyer only
(c) Seller only
(d) Buyer and Seller to the extent of their shares.

[Link] Goods are damaged after Sale. The Risk is to be borne

by __________
(a) Buyer only. (b) Seller only.
(c) Both (a) & (b). (d) None of the above.

28. In a concluded sale, if goods are destroyed, loss is to be

faced by _________
(a) Seller (b) Buyer
(c) Carrier (d) Seller's agent

29. Where goods are not specific and ascertainable at the time
of the making of the contract, it shall
(a) become void
(b) become voidable at the option of the Buyer.
(c) operate as an agreement to sell
(d) become a valid contract of sale.
30. Where by a contract of sale, the seller purports to effect a
_________ the contract operates as an agreement to sell.
(a) present sale of existing goods.
(b) future sale of existing goods.
(c) present sale of future goods.
(d) future sale of future goods.

31. When there is contract for sale of specific goods, the

agreements ________ is if the goods, without the knowledge
of seller, have been perished or have no longer in accordance
with description before the BY contract.
(a) Void (b) Voidable
(c) Valid and enforceable (d) Illegal

32. If the Goods completely perish before Contract of Sale, the

Contract becomes -
(a) Valid (b) Void
(c) Voidable (d) Unenforceable

33. Which of the following is not an essential element of a

Contract of sale?
(a) Existence of essential elements of a valid contract.
(b) Payment of price at the time of Contract
(c) Subject matter of Contract must be goods
(d) There should be two partiesi.e seller and buyer.
34. In a contract of sale, the Price may be -
(a) fixed by the contract
(b) agreed to be fixed in a manner thereby agreed
(c) determined by course of dealings between the parties
(d) all of the above.

35. Which of the following statements is correct in relation to

ascertainment of price of goods?
(a) Price of goods must be fixed in the Contract of sale.
(b) Where the parties agreed that the price of goods has to be
fixed by third party, and if the third party fails to fix the price,
the agreement is void
(c) If the price is not fixed by any manner, seller is not entitled
to any price
(d) None of the above

36. A contracted with B to supply materials worth 10,000 for

interior design. The contract between A and B is_________
(a) Contract of sale (b) Contract of work
(c) Contract of work & labour (d) All of the above

37. Rasheed sends gold to Adam for Making an ornament. This

is a ________
(a) Contract of sale (b) Contract of work and labour
(c) Hire purchase agreement (d) Sale on approval basis
38. A hire purchaser of the goods:
(a) Can resale the goods
(b) Cannot use the goods
(c) Has an option to return the goods (or) buy it
(d) None of the above

ANSWERS TO MCQs
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
a b d b c b c d d a a d a d d d c a

19 20 21 22 23 24 25 26 27 28 29 30 31 32
c b b b a c b c a b c c a b

33 34 35 36 37 38
b d b c b c
CONDITIONS & WARRANTIES

1. A stipulation in a contract of sale with reference to the goods

which are the subject matter thereof may be –
(a) Condition (b) Warranty
(c) Condition precedent (d) Either (a) or (b)

2. Which of the following is not correct regarding appropriation

of goods for unascertained goods?
(a) The assent must be given either before or after
appropriation
(b) Buyer or seller can make appropriation.

3. Under the Sale of Goods Act, a Condition is a stipulation

essential for the ________ of the contract.
(a) Collateral Purpose (b) Main purpose
(c) Both (a) and (b) (d) Either (a) or (b)

4.A "Warranty", under the Sale of Goods Act, has been defined
as a stipulation –
(a) collateral to the main purpose of the contract
(b) with regard to time
(c) essential to the main purpose of the contract
(d) all of the above
5.________is a stipulation collateral to the main purpose of the
contract which creates right to claim damages and not to
rescind the contract
(a) Condition
(b) Warranty
(c) Both condition and warranty
(d) Neither condition nor warranty

6. The breach of a "condition" in a contract of sale of goods,

gives the right to-
(a) repudiate the contract (b) claim for damages only
(c) either (a) or (b) (d) both (a) and (b)

7. Breach of a "Warranty" in a contract of sale of goods, gives

the right to-
(a) reject the goods (b) claim for damages
(c) repudiate the contract (d) all of the above

8. Implied condition is not treated as implied warranty when:

(a) Voluntary waiver of condition
(b) Contract is in separable, and buyer accepted the part of the
goods
(c) Condition is not excused by law
(d) All of the above
9. When the breach of condition is treated as breach of
warranty, buyer has right to:
(a) Claim damages (b) Repudiate the contract
(c) Reject the goods (d) None of the above

10. Conditions which are presumed by Law to be present in a

Contract are-
(a) Express conditions (b) Implied conditions
(c) Qualified conditions (d) Unqualified conditions.

11. When a person sells the goods by infringing the copyright

or trademark of the others, there is breach of an Implied
(a) Condition as to Title (b) Condition as to Description
(c) Condition as to Merchantability (d) None of these.

12. In case of sale by description, there is an implied that the

goods shall correspond to description.
(a) Warranty (b) Condition
(c) Stipulation (d) Description

13. In case of sale of goods by sample as well as by

description, the bulk of the goods should correspond with-
(a) the sample
(b) the description
(c) either sample or description
(d) both sample and description
14. In a contract of sale, ordinarily there is as to the quality or
fitness for any purpose of goods.
(a) an implied warranty or condition
(b) an express warranty or condition
(c) no implied warranty or condition
(d) no express warranty or condition

15. Implied condition as to quality or fitness becomes

applicable if -
(a) Buyer discloses to the Seller, the exact purpose for which
goods are required.
(b) Buyer suffers from an abnormality and does not
communicate this fact to the Seller.
(c) Seller's business is to sell specific goods under a patent or
trade name.
(d) Buyer reserves the right to examine the goods and
check its quality.

16. M purchased a hot water bottle from a Chemist. The bottle

burst and injured his wife. The Chemist is liable on account of
(a) breach of express condition as to quality
(b) breach of implied condition as to quality
(c) personal injury caused to the Buyer's wife
(d) hot water bottle sales are illegal.
17. The buyer of a pesticide tin, the lid of which is broken, gets
injured by inhaling the powder. The seller has failed in
disclosing the same. Here buyer can claim:
(a) Damages for breach of warranty as to disclose of dangerous
nature
(b) Repudiation of contract

18. Merchantable Quality of Goods means

(a) Goods are free from Latent defects
(b) Marketable at their full Value
(c) Goods can be used for the purpose for which they are
purchased
(d) All of the above.

19 . In case of in addition to the implied condition as to the

merchantability there is another implied condition that the
goods shall be wholesome
(a) Silver (b) Equity share
(c) Machineries (d) Eatables

20. The Implied Warranties as per Sale of Goods Act includes -

(a) Enjoyment of undisturbed Possession
(b) Disclosure of dangerous nature of Goods
(c) Quality of fitness by usage of Trade
(d) All of the above.
21. Which of the following is not an implied warranty?
(a) Warranty as to undisturbed possession
(b) Warranty as to dangerous nature of goods
(c) Warranty as to existences of encumbrances
(d) Warranty as to custom or usage of trade

22. The principle of "Caveat Emptor" as found in Sec.16 of the

Sale of Goods Act, means that the -
(a) Buyer must take care
(b) Buyer must take a chance
(c) Seller must take care
(d) Seller must take a chance

23. Caveat emptor means

(a) Let the buyer beware before buying the goods
(b) Let the Seller beware before Selling the goods
(c) Let the buyer beware after buying the goods
(d) Let the seller beware after the goods

24. The Doctrine of Caveat Emptor applies to the Sale where -

(a) The buyer expressly informed the seller the particular
purpose for which the goods are being bought.
(b) Sale under a Patent or Trade Name.
(c) When the good is of merchantable quality and the buyer
has examined the good.
(d) None of the above.
25. The doctrine of caveat emptor is applicable
where_________
(a) There is no implied warranty or condition as to the quality
or fitness of goods
(b) The buyer discloses to the seller the particular purpose for
which goods are required
(c) Goods are bought by sample well as description
(d) The seller sells the goods by making fraud and as the
buyer believes it.

ANSWERS TO MCQs
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
d a b a b d b c a b a b d c a b a d

19 20 21 22 23 24 25
d d c a a d a
TRANSFER OF OWNERSHIP & DELIVERY
OF GOODS

1. Under the sale of goods act, 1930. The risk prima facie
passes with _______
(a) Ownership (b) Transit
(c) Discharge of contract (d) Delivery of goods

2. By transferring the Property, the Rights and Liabilities will

transfer to –
(a) Buyer (b) Seller
(c) Both (a) and (b) (d) None of these.

3. For transfer of property in unascertained goods, the basic

condition is that -
(a) Goods must be ascertained and appropriated.
(b) Goods must be defined by description.
(c) Buyer must receive a sample of the goods
(d) Seller must have produced / purchased the goods

[Link] property, in case of sale of unascertained goods, passes

when-
(a) Pucca Delivery Order is entered
(b) Goods are identified and appropriated to the contract
(c) Goods are so far ascertained that the parties have agreed
that they shall be taken from some specific larger stock.
(d) Transfer is made in the books of the warehouse-man.
5. The process of identifying the goods and setting apart as per
the intended quality or description is called -
(a) Identification (b) Procurement
(c) Ascertainment (d) Allocation

6. In case of sale of specific goods in a deliverable state, the

property in goods passes to the buyer when ________
(a) Contract in entered
(b) Payment is made by the buyer
(c) Goods are delivered and payment is made
(d) Goods are delivered to buyer

[Link] per sales of goods Act, 1930 implied condition as

examined the goods? to merchantable quality ______ where
the buyer has
(a) is applicable (b) is presumed
(c) is not applicable (d) none of the above

8. For passing of property in respect of specific of ascertained

goods, the intention of the parties can be ascertained from -
(a) Terms of the contract
(b) Conduct of the parties
(c) Circumstances of the case
(d) All of the above
9. Delivery of goods to the Carrier for the purpose of
transmission to the Buyer automatically means that the
property in goods vest in the Buyer.
(a) True (b) Partly True
(c) False (d) None of the above

10. In case of sale on "sale or return" or "approval" basis,

property passes to the Buyer when -
(a) Buyer approves or accepts the goods
(b) Buyer does any act adopting the transaction
(c) Buyer retains the goods for more than the contract-
stipulated time or reasonable time, without giving notice of
rejection
(d) All of the above

11. In a sale on "approval" basis, any act of the Buyer

exercising domination over the goods, showing an unequivocal
intention to buy is called -
(a) adopting the transaction (b) adapting the transaction
(c) revoking the transaction (d) rejecting the transaction

12. In cases of goods sent on approval basis, the goods are at

the, if they perish in an inevitable accident.
(a) Buyer's Risk (b) Seller's Risk
(c) Combined Risk of Buyer and Seller (d) Carrier's Risk
13. Q sells 100 tonnes of Rice to P at 50,000 per tonne. P
makes the full payment and says that he will take the Goods by
next week. Before P could take the Goods, the Goods are
destroyed. The Loss will be borne by-
(e) P (f) Q
(g) Both P & Q equally. (h) None.

14. When goods are shipped or delivered to a railway

administration for carriage by railway, the Seller is prima facie
deemed to have reserved the right of disposal, if, by the Bill of
Lading or Railway Receipt, the goods are deliverable to the
order of -
(a) Buyer (b) Seller
(c) Buyer or his agent (d) Seller or his agent

15. Ram of Chennai took a Bill of Lading in the name of Suman

of Maldives, but sent it to, Tarun, Ram's Agent in Maldives. The
goods were destroyed while in sea. Who has to bear the loss of
goods?
(a) Ram (b) Suman
(c) Tarun (d) All of the above

16. Risk prime facie passes with -

(a) property or ownership (b) completed agreement
(c) verification and delivery of goods (d) payment of price
17. When the property in Goods is transferred to Buyer, Goods
are at the ________ risk, irrespective of whether delivery has
been made or not.
(a) Buyer's (b) Seller's
(c) Carrier's (d) All of the above

[Link] Latin maxim "Nemo Dat Quod Non Habet" means

(a) No man can pass a better title than he has
(b) Let the Buyer beware
(c) No consideration - No contract
(d) Ignorance of law is no excuse

[Link] by Mercantile agent is not valid when:

(a) The buyer is acting in ordinary course of business
(b) When the buyer knows that the agent has no authority to
sell
(c) The buyer must act in good faith
(d) The possession of the goods must be with the consent of
the owner
20. To enable the Buyer to get good title, in case of sale by
Mercantile Agent, the _________ that the Seller/Agent has no
authority to sell
(a) Buyer has notice at the time of contract
(b) Buyer has no notice at the time of contract
(c) True Owner has notice at the time of contract
(d) True Owner has no notice at the time of contract
21. A obtains a necklace from B, a jeweller, by playing fraud
upon him. This contract is voidable at the option of B. But
before B could terminate the contract, A sells the necklace to C
who buys it in good faith and without notice of A's defective
title.
(a) A gets a good title to goods.
(b) B gets a good title to goods.
(c) C gets a good title to goods.
(d) There is no sale at all.

22. A person finds goods belonging to another person in a

public place. In such a case, the finder _______
(a) Becomes owner of the goods
(b) Does not become owner of the goods, but can use them
(c) Is under duty to trace the owner and return the goods to
him
(d) Can sell them with out taking any effort to trace the owner

23. A Finder of goods has the power to sell the goods to give
good title to the Buyer, if the owner of goods cannot be found
with –
(a) ordinary diligence (b) reasonable diligence
(c) due diligence (d) lack of diligence

24. When goods are physically handed over to the Buyer or his
authorised agent i.e. transfer of physical custody, it is a case of
–
(a) Actual Delivery (b) Constructive Delivery
(c) Symbolical Delivery (d) Forward Delivery
25. Giving document of title to goods is which type of delivery?
(a) Symbolic (b) Constructive
(c) Actual (d) None of these.

26. A sells to B 100 bags of wheat lying in C's warehouse. A

makes a delivery order to C to transfer the wheat to B. C
transfers and holds the 100 bags on behalf of B and by making
necessary entries in his books. This is a case of -
(a) Actual Delivery (b) Constructive Delivery
(c) Symbolical Delivery (d) Forward Delivery

27. Where Goods are bulky / heavy and it is not possible to

physically hand over them to the Buyer, some symbol which
carries with it the real possession or control over the Goods is
handed over to the Buyer. This is a case of -
(a) Actual Delivery (b) Constructive Delivery
(c) Symbolical Delivery (d) Forward Delivery

28. The keys of Warehouse where the goods are stored. is

handed over to the Buyer. It is called
(a) Actual (b) Symbolic
(c) Constructive (d) Conditional.

29. Under Sec.36(4), demand or tender of delivery may be

treated as ineffectual unless made-
(a) during business hours (b) during operating hours
(c) at a reasonable hour (d) at an appropriate hour
30. Seller sends the goods to the buyer at larger (or) smaller
quantity than ordered quantity. The option to the buyer is -
(a) Reject the whole quantity
(b) Accept the whole quantity
(c) Accept (or) reject the whole quantity
(d) All of the above

31. Under the sale of goods act 1930, In case the seller
delivers to the buyer a quantity less than the goods brought
under the contract, the buyer
(a) May reject the whole goods delivered
(b) Should not reject the goods delivered as more quality might
he demanded
(c) May resell the goods delivered
(d) Gives price less than contracted price for the goods
delivered

32. In case of excess-delivery, i.e. more than the contracted

quantity, the Buyer can -
(a) Reject in full
(b) Accept the contract quantity and reject the excess
(c) Accept the whole
(d) Either (a) or (b) or (c)
33. Where the Seller agrees to deliver the Goods at his own
risk at the Buyer shall bear the risk of deterioration necessarily
incident to the course of transit, unless otherwise agreed.
(a) a place other than at which they are sold
(b) a place where the goods were, at the time of sale
(c) both (a) and (b)
(d) either (a) or (b)

34. A agreed to sell 100 quintals of rice to B, B does not like

that quality and refuse them-
(a) B can do so and he is not liable for any loss
(b) B can do so, but he is liable to pay for care and custody of
goods
(c) B has no right to do so but he is liable to pay damages
(d) None of the above

35. Under Section 42 of the Sale of Goods Act, acceptance of

goods by the Buyer -
(a) can be conditional (b) can be absolute
(c) either (a) or (b) (d) neither (a) nor (b)

ANSWERS TO MCQs
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
a a a b c a a d c d a b a d a a a a

19 20 21 22 23 24 25 26 27 28 29 30 31 32 33
b b c c b a a b c b c c a d a

34 35
b c
UNPAID SELLER

1. Rights of an unpaid seller include_______

(a) Right against the goods
(b) Right of stoppage in transit
(c) Right of re-sale
(d) All of the above

2. Which of the following is not right of an unpaid seller?

(a) To resell the goods
(b) To stop the goods in transit
(c) To retain the goods
(d) To demand back the goods

3. The term "Unpaid Seller" includes -

(a) Agent of the Buyer
(b) Agent of the Seller
(c) Agent of the Carrier / Transporter
(d) All of the above
4. M sold Goods to B. The Payment was to be done after one
month. B did not make the payment. The Right of Lien can be
exercised by M when the Goods are-
(a) Handed over to tranporters
(b) Not handed over to anyone
c) Handed over to B
(d) Handed over to anyone.
[Link] of general lien cannot be exercised by -
(a) Factor (b) Banker
(c) Auctioneer (d) All of these

6. Unpaid Seller sells goods to the new buyer who was in

possession of the goods. The new buyer -
(a) Gets Good Title to the Goods
(b) Does not get Good Title to the Goods
(c) Gets Good title to the goods subject to consent of original
buyer.
(d) None of these.

7. an Unpaid Seller when the property in goods has passed to

the Buyer –
(a) Right of Lien
(b) Right of Stoppage of goods in transit
(c) Right of Re-sale
(d) Right of withholding delivery of goods

8. The right of lien is available to the Unpaid Seller, only when

–
(a) he is not in possession of the goods
(b) he is in possession of the goods
(c) he has delivered the goods to the Carrier / Transporter
(d) he has delivered the goods to the Buyer

[Link] of lien is lost for the seller, when

(a) Goods are delivered to the carrier
(b) Buyer or his agent obtains possession of goods lawfully
(c) Seller waives his right of lien
(d) In all the above cases

10. Goods are deemed to be in transit from the time they are
delivered to the Carrier or other bailee for transmission to the
Buyer, until –
(a) Buyer becomes solvent
(b) Buyer or his agent takes delivery of the goods
(c) Seller becomes solvent
(d) Seller or his agent takes delivery of the goods

11. Unpaid Seller's right of stoppage in transit can be exercised

only when the Buyer is insolvent.
(a) True (b) Partly True
(c) False (d) None of the above
12. Where the goods are of perishable Nature, unpaid seller
can
(a) Sue for price
(b) Repudiate the contract before due date
(c) Resell the goods
(d) Sue for damages

13. An unpaid seller pledged his goods, than resale to a bona

fide buyer, such buyer acquires:
(a) No title (b) Better Title
(c) No title after pledge of Goods (d) None of the above

14. Which of the following rights are not available to unpaid

seller against the buyer?
(a) Suit for price (b) Suit for damages
(c) Suit for interest (d) Stoppage of goods in transit

15. Rights of unpaid seller does not include:

(a) Stoppage of goods in transit
(b) Claim for price
(c) Suit for interest
(d) None of the above
MISCELLANEOUS

16. A bid at an auction is an acceptance of offer which is

confirmed by the fall of hammer.
(a) True (b) Partly True
(c) False (d) None of the above

[Link] Sale Completes by -

(a) Fall of Hammer (b) Acceptance
(c) Offer (d) None of these.

18. Auction sale can be subject to:

(a) Reserve price
(b) Market price
(c) Any price
(d) None of the above

19. Risk follows ownership –

(a) only when goods have been delivered
(b) only when price has been paid
(c) whether delivery has been made or not
(d) even when price has not been paid.
 ANSWERS TO MCQs
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
d d b b c a d b d b a c b d d c a a

19
c