Sections 31-32 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Chapter IV is about performance. Section 31 states the two basic duties: the seller must deliver the goods, the buyer must accept and pay for them, in accordance with the terms of the contract. Section 32 adds that, unless otherwise agreed, delivery and payment are "concurrent conditions": each side must be ready and willing to give what it owes in exchange for what it is to receive.
It is the duty of the seller to deliver the goods and of the buyer to accept and pay for them, in accordance with the terms of the contract (section 31). Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions: the seller must be ready and willing to give possession in exchange for the price, and the buyer must be ready and willing to pay the price in exchange for possession (section 32).
Reading note
This article follows the consolidated text of the Act consulted (latest amendment shown: Act 28 of 1993); later amendments should be checked in the official text. "Delivery" is defined in section 2(2) as "voluntary transfer of possession from one person to another", and "price" in section 2(10) as "the money consideration for a sale of goods". The mechanics of delivery follow in sections 33 to 44. A supply agreement that spells out delivery and payment steps is the practical tool, and it is the work of agreement drafting.
Section 31: the two basic duties
"It is the duty of the seller to deliver the goods and of the buyer to accept and pay for them, in accordance with the terms of the contract of sale."
The section has three features.
- The seller's duty is to deliver the goods.
- The buyer's duty has two parts: to accept and to pay for the goods.
- Both duties are to be performed "in accordance with the terms of the contract of sale". The contract sets the detail: what, when, where and how.
Notice that the buyer's duty is two-fold. Accepting and paying are named together. The Act deals later with what acceptance means (section 42) and with the buyer who refuses to take delivery (section 44); those are covered in later articles.
Example (the writer's own, not printed in the Act): Tandon Pumps agrees to sell ten pumps to Uppal Farms at an agreed price, delivery at the buyer's farm on 15 August. Tandon Pumps' duty is to deliver the ten pumps in accordance with that term. Uppal Farms' duty is to accept them and pay for them in accordance with the contract.
The general law of the performance of promises is in the Indian Contract Act, 1872; see Section 37 of the Indian Contract Act, 1872 and Sections 38-39 of that Act (tender of performance). Under section 3 of this Act those provisions continue to apply to a contract of sale, save so far as they are inconsistent with its express provisions.
Section 32: concurrent conditions
"Unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, that is to say, the seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price, and the buyer shall be ready and willing to pay the price in exchange for possession of the goods."
"Unless otherwise agreed"
The section opens with the words that let the parties choose another order. If the contract says "payment 30 days after delivery" or "payment in advance", the contract prevails.
What "concurrent" means here
The section explains its own word: "that is to say". There are two halves.
- The seller shall be ready and willing to give possession of the goods to the buyer in exchange for the price.
- The buyer shall be ready and willing to pay the price in exchange for possession of the goods.
Each side's performance is tied to the other's. Neither has to go first. The test the section uses is readiness and willingness, not completed performance.
Example (the writer's own): Vora Trading agrees to sell 500 bags of rice to Wadhwa Stores and the contract is silent on the order of performance. On the delivery day Vora Trading has the rice loaded and ready at its godown, and Wadhwa Stores arrives with a bank draft for the price. Each is ready and willing to perform in exchange for the other's performance. That is the position section 32 describes. If Vora Trading had refused to part with the rice until paid and Wadhwa Stores refused to pay until it had the rice, each would be pointing to the other's duty, which is the situation the concurrent-condition rule is designed to describe.
Second example (also the writer's own): The contract between the same parties says "payment within 30 days of delivery". The opening words, "Unless otherwise agreed", then apply: the contract has made a different arrangement, and the concurrent-condition rule does not govern.
For the Contract Act on the order in which reciprocal promises are performed, see Sections 51-53 of the Indian Contract Act, 1872.
Table: sections 31 and 32
| Point | Section 31 | Section 32 |
|---|---|---|
| Subject | the duties themselves | the order in which the duties are performed |
| Seller | to deliver the goods | to be ready and willing to give possession in exchange for the price |
| Buyer | to accept and pay for the goods | to be ready and willing to pay the price in exchange for possession |
| Source of the detail | terms of the contract of sale | "Unless otherwise agreed", the section's own rule |
Links with sections 5 and 11
Section 5(1) says the contract may provide for immediate or postponed delivery or payment, or for either by instalments. Section 32's default gives way to such terms. Section 11 says that stipulations as to time of payment are not deemed to be of the essence unless a different intention appears. Read together: the parties choose when delivery and payment occur; if they say nothing, delivery and payment are concurrent; and time of payment is not, by default, of the essence. See Section 5 and Section 11.
Practical points
- Write the sequence. Say whether payment is in advance, on delivery or after delivery, and for each instalment.
- Show readiness. Under section 32 each side must be "ready and willing". A seller who has the goods ready, and a buyer who has the funds ready, can each show it, by a dated notice if need be.
- Keep delivery proof. A challan or receipt shows the transfer of possession.
- Do not assume credit. Unless the contract allows time, the default is exchange.
- Check the next steps. How delivery is made, and what happens on a wrong quantity or a refusal, is set out in the sections that follow in Chapter IV, starting with sections 33 to 35 and section 36.
Need help with delivery and payment terms?
If delivery dates, payment dates and the order of performance in your supply contract are unclear, we can draft or revise the agreement so that each side knows what it must do first, and what it may wait for.
Key takeaways
- The seller's duty is to deliver; the buyer's is to accept and pay, in accordance with the terms of the contract.
- Unless otherwise agreed, delivery and payment are concurrent conditions.
- Each side must be ready and willing to perform in exchange for the other's performance.
- The parties can change the order by agreement, for example payment after delivery.
Read next
- Section 11 of the Sale of Goods Act, 1930: stipulations as to time of payment and other time terms
- Sections 33-35 of the Sale of Goods Act, 1930: delivery, part delivery and buyer to apply for delivery
- Section 36 of the Sale of Goods Act, 1930: rules as to delivery, place, time and expenses
- Section 37 of the Indian Contract Act, 1872: obligation of parties to perform or offer to perform
Disclaimer: Based on the consolidated text of the Sale of Goods Act, 1930 consulted on 2 October 2026, whose latest amendment shown is Act 28 of 1993. It explains the words of the statute only; later amendments and the way courts apply these sections should be checked. This article is general information, not legal advice; check the official text before acting.