Question

    Under the Sale of Goods Act, 1930, Section 50, the right

    of stoppage in transit can be exercised by an unpaid seller when:
    A The goods are in the buyer's possession Correct Answer Incorrect Answer
    B The buyer becomes insolvent and goods are in transit Correct Answer Incorrect Answer
    C The buyer fails to accept delivery Correct Answer Incorrect Answer
    D The seller changes his mind before delivery Correct Answer Incorrect Answer
    E The goods are defective or damaged Correct Answer Incorrect Answer

    Solution

    Section 50 of the Sale of Goods Act, 1930, provides that when the buyer becomes insolvent, the unpaid seller who has parted with possession of goods has the right to stop them in transit, meaning the seller may resume possession as long as goods remain in transit. This right protects the seller's interests when the buyer's financial condition deteriorates after goods leave the seller's possession but before delivery completion.

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