Brain Booster Articles
AUCTION SALE IN REGARD WITH SALES OF GOODS ACT 1930
Updated: Jan 5, 2021
Author: Kaushiki Sharma, II year of B.B.A., LL.B.(Hons.) from Amity University, Jaipur
Whenever the word sale comes to mind, the first thing which we think about is some goods property and the exchange of money, from any shop mall or online through person to person. But there is one more kind of sale which is done publicly, where a prospective buyer can buy the goods or property and this kind of sale is known as the auction sale.
This kind of sale concept is continued from 500 B.C especially in Greece; well the auction of the woman was done for the marriages. Is higher the bid of the buyer from the reserved price woman was sold to that buyer. And the same was used to do with the goods now.
As the era was changing a new economic policy was introduced in India in 1990, many new changes were brought in every aspect. As technology was growing it gave the chance to auction many other goods, suggest computers, machines etc.
The auctioneer may be the sailor himself or maybe an appointed agent. The auction area should work in the bona fide intention towards the seller.
Before discussing the provision of auction sale under sales of goods act let’s know what is the sales of goods act 1930.
This is the act dealing with the contract related to sales. The saga was the part of contract act till 1930, 1930 but after 1930 it was separated from the Indian contract act and came into existence on 1st July 1930, which deals with movable properties.
There is another act called transfer of property act 1882 which deals with immovable property.
According to the sales of goods act 1930, it deals with the goods that include
· Any movable property except actionable claim money.
· Stokes and shares.
· The growing crops, standing timber, and grass.
· The things that are attached or forming part of the land which is agreed to be severed from the land before the sale.
PROVISION FOR AUCTION SALE UNDER SALES OF GOODS ACT COVERED UNDER SECTION 64
1. Where the goods are put in lots for sale, each lot will be considered a separate item and will have a separate contract of sale.
2. The bidder has the right to withdraw his bid until the auction announces the completion of the sale by the fall of the hammer or in another manner.
Harris v. Nickerson 
There were the items to be sold and were auctioned on a particular place for three days. but before buying something from the plaintiff, the goods were withdrawn from the sale. The plaintiff sued the defendant for the expenses caused by him. The court held that the advertisement for the auction Is not the Offer an advertiser can withdraw the goods on his will before the auction, Hence he is not liable for any expenses incurred by the plaintiff.
Payne v. Cave 
In this case, the defendant was the highest bidder for the goods at the auction. but before the auction put down the hammer he withdrew his bid. It was held by the court that defendant is not liable to purchase the goods as he has withdrawn his bid before the auction was completed and he has right to withdraw the bid anytime before the auction according to his will.
1. The sealer two has the right to bid to do so he must expressly reserve such right to bid. For this, the seller on his behalf can appoint any person at the auction.
2. If the right to bid of the seller is not notified He cannot do so under any situations. Then the seller, nor any person on his behalf can bid in the auction. If done it will be treated as unlawful. If any sale contravenes this tool will be treated as fraudulent by the buyer.
3. The auction sale is subject to reserve price or upset price which means the auctioneer will not sell the goods below the said reserved price.
4. The buyer has the right to choose to honour or can choose to void it if the seller or any person appointed by him pretends to raise the price of the goods. This type of sale is voidable at the option of the buyer.
5. The auctioneer cannot deal with the buyer on credit or cannot accept a bill of exchange on his own will. Unless the seller himself is ready for it.
Mcmanus v. Fortescue 
In this case, where the auctioneer sold the property below the reserve price and the seller refused to sign the memorandum of sale. The court held that it was done mistakenly. so, the auctioneer will not be held liable.
Barry v. Davies 
If there is no reserve price for the property to be auctioned, so the property should be sold to the highest bidder. with the exception that, seller not authorized to sell, unlawful selling of goods, the buyer not have enough money to buy, or if he's not authorized.
Auction seals have continued in our country since ancient times. The matter involves falling over the hammer to declare the completion of the sale which is the most important part of this type of public sale known as an auction sale. The highest bid of a person the property would be sold to that person or a bidder. The bid by a buyer can be said as an offer and declaration of completion of the sale can be said as acceptance. The two parties involved are, one is the auctioneer and another is bidder or buyer, dealing in some of the other goods. Hence, it is the contract of sale, which is covered under section 64 off sales of goods act 1930. And this type of sale is still prevailing in our country with new and different goods and property.