Ritvik sold 500 bags of wheat to Anoj. Each bag contains 50 Kilograms of wheat. Ritvik sent 450 bags by road transport and Anoj himself took…

CA Foundation · Business Laws · RTP · September 2026
Ritvik sold 500 bags of wheat to Anoj. Each bag contains 50 Kilograms of wheat. Ritvik sent 450 bags by road transport and Anoj himself took remaining 50 bags. Before Anoj receives delivery of 450 bags sent by road transport, he becomes bankrupt. Ritvik being still unpaid, stops the bags in transit. The official receiver, on Anoj's insolvency claims the bags. Decide the case with reference to the provisions of the Sale of Goods Act, 1930.

Suggested Answer and Working Notes:

Right of stoppage in transit (Section 50 of the Sale of Goods Act, 1930): Subject to the provisions of this Act, when the buyer of goods becomes insolvent, the unpaid seller who has parted with the possession of the goods has the right of stopping them in transit, that is to say, he may resume possession of the goods as long as they are in the course of transit and may retain them until paid or tendered price of the goods. When the unpaid seller has parted with the goods to a carrier and the buyer has become insolvent, he can exercise this right of asking the carrier to return the goods back, or not to deliver the goods to the buyer. In the instant case, Anoj, the buyer becomes insolvent, and 450 bags are in transit. Ritvik, the seller, can stop the goods in transit by giving a notice of it to Anoj. The official receiver, on Anoj's insolvency cannot claim the bags.

Topics: The Sale of Goods Act, 1930

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