THE SALE OF GOODS ACT 1930
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Meaning of right of stoppage in transit: The right of stoppage in transit means the right of stopping the goods while they are in transit, to regain the possession and to retain them till the full price is paid. 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. This right is the extension of the right of lien because it entitles the seller to regain possession even when the seller has parted with the possession of the goods.
When does the transit come to an end? When the buyer or other bailee obtains delivery. . Buyer obtains delivery before the arrival of goods at destination. . .. Where the carrier or other bailee acknowledges to the buyer or his agent that he holds the goods as soon as the goods are loaded on the ship, unless the seller has reserved the right of disposal of the goods. .If the carrier wrongfully refuses to deliver the goods to the buyer.
-Where goods are delivered to the carrier hired by the buyer, the transit comes to an end. -Where the part delivery of the goods has been made to the buyer, there the transit will come to an end for the remaining goods which are yet in the course of transmission. - Where the goods are delivered to a ship chartered by the buyer, the transit comes to an end.
Distinction between Right of Lien and Right of Stoppage in Transit (i) The essence of a right of lien is to retain possession whereas the right of stoppage in transit is right to regain possession. (ii) Seller should be in possession of goods under lien while in stoppage in transit (i) seller should have parted with the possession (ii) possession should be with a carrier, & (ii) buyer has not acquired the possession. .
. (ii) Right of lien can be exercised even when the buyer is not insolvent but it is not the case with right of stoppage in transit. (iv) Right of stoppage in transit begins when the right of lien ends. Thus the end of the right of lien is the starting point of the right of stoppage in transit.
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