“A”, is the buyer of rice under a ‘cost, insurance and freight’ (C.I.F.) contract. Immediately after taking the delivery of the goods, he sold a part of rice and dispatched the same to sub-buyer. Later on, “A” came to know that the quality of purchased rice was not in accordance with the contract and wants to reject the same. Is “A” entitled for any relief under the law? Give reasons.

Question: “A”, is the buyer of rice under a ‘cost, insurance and freight’ (C.I.F.) contract. Immediately after taking the delivery of the goods, he sold a part of rice and dispatched the same to sub-buyer. Later on, “A” came to know that the quality of purchased rice was not in accordance with the contract and wants to reject the same. Is “A” entitled for any relief under the law? Give reasons. [DJS 2019]

Find the answer to the mains question of the Law of Contract only on Legal Bites. [“A”, is the buyer of rice under a ‘cost, insurance and freight’ (C.I.F.) contract. Immediately after taking the delivery of the goods, he sold a part of rice and dispatched the same to sub-buyer. Later on, “A” came to know that the quality of purchased rice was not in accordance with the contract and wants to reject the same. Is “A” entitled for any relief under the law? Give reasons.]

Answer

In the given scenario, "A" purchased rice under a 'cost, insurance, and freight' (C.I.F.) contract, took delivery of the goods, and subsequently sold a part of the rice to a sub-buyer. However, "A" later discovered that the quality of the purchased rice does not meet the contractual requirements and wishes to reject it. Whether "A" is entitled to any relief under the law depends on the terms of the contract and the applicable laws. Here are some considerations:

Examination and Acceptance of Goods: Generally, under a C.I.F. contract, the buyer is entitled to examine the goods upon delivery to ensure they conform to the contract specifications. If the buyer fails to reject the goods within a reasonable time after delivery, they may be deemed to have accepted the goods.

Notice of Rejection: If "A" wants to reject the rice due to quality issues, they should provide timely notice to the seller. The notice should clearly state the grounds for rejection and should be given within a reasonable time after "A" discovered or should have discovered the defect in the goods.

Contractual Terms: The C.I.F. contract may contain specific provisions regarding the quality of the goods, inspection, rejection, and remedies in case of non-conformity. It is essential to review the terms of the contract to determine the rights and obligations of the parties in such situations.

Legal Remedies: Under the Indian Sale of Goods Act, 1930, if the goods delivered do not conform to the contract, the buyer may have various legal remedies, such as rejecting the goods, seeking damages for any loss suffered, or requesting specific performance.

In this case, if "A" promptly notified the seller about the quality issues and the rejection of the rice, and if the rejection is in accordance with the terms of the contract and the provisions of the Sale of Goods Act, "A" may be entitled to relief. This could include returning the non-conforming goods and seeking a refund or replacement, or pursuing a claim for damages.