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Comparison between Sale and Agreement to Sell

S. No.
Basis
Sale
Agreement to Sell
1
Nature of contract
A sale is an executed contract.
An agreement to sell is an executory contract.
2
Transfer of property
In a sale, the property in goods are transferred from the seller to the buyer when the contract is made.
In an agreement to sell, transfer of property takes place at a future date.
3
Nature of goods
The contract is for existing and specific goods.
The contract is mostly for future and contingent goods.
4
Risk of loss
In a sale, the risk passes to the buyer as the buyer becomes the owner when the sale takes place.
In an agreement to sell, the risk is with the seller as he remains the owner.
5
Insolvency of the buyer
In a sale, if the buyer is declared insolvent, before he pays for the goods, the seller must deliver the goods to the Official Receiver or Assignee.
In an agreement to sell, when the buyer becomes insolvent before he pays for the goods, the seller may refuse to deliver the goods to the Official Receiver or Assignee unless paid for, as ownership has not passed to the buyers.
6
Insolvency of the seller
In a sale, if the seller becomes insolvent, the buyer being owner of goods is entitled to recover the goods from the Official Receiver or Assignee of the seller.
In an agreement to sell, if the seller has become insolvent and the buyer has paid the price for the goods, then the buyer can only claim as a creditor and not the goods because property in goods still rests with the seller.
7
Consequences of breach by buyer
In a sale, in case of breach by the buyer, the seller can sue for the price even though the goods are still in his possession.
In an agreement to sell, in case of breach by buyer, the seller can sue for damages only and not for price.
8
Consequences of breach by seller
In a sale, in case of breach by seller, the buyer can compel the seller to deliver the goods to him or pay the damages.
In an agreement to sell, in case of breach by seller, the buyer can sue for damages only and cannot compel the seller to deliver the goods to him as ownership has not been transferred.




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