Distinction/Difference Between Consignment and Sale:
What is the
distinction/difference between consignment and sale?
The following are the main
points of the difference between consignment and sale.
Transfer of Legal Ownership of the Goods:
In case of sale, the legal ownership of
the goods sold is transferred to the purchaser of goods. Whereas in case
of a consignment of goods , the legal ownership of the goods is not
transferred to the consignment but the ownership of the goods remains vested
in the consignor till the goods consigned are sold by the consignee.
Relationship Between Consignor and Consignee:
In case of a sale of goods, the
relationship between the seller and the purchaser of the goods is that of a
creditor and a debtor whereas in case of a consignment the
relationship between the consignor and the consignee is that of a
principal and agent. because the consignee is to sell goods on behalf of
In consignment, expenses incurred by the
consignee in connection with the goods consigned to him are usually borne by
the consignor whereas in case of a sale, expenses incurred after sale of
goods are born by the purchaser.
Risk Attached to the Goods:
In case of consignment, risk attached to
the goods sold lies with the consignor till the goods consigned are sold
by the consignee. But in case of a sale, risk attached to the goods sold
is transferred to the buyer of goods.
Return of Goods:
In case of consignment, return of goods is
possible if the goods are not sold by the consignee. But in case of sale,
return of goods is not possible as goods once sold are not returnable.
Requirement of Account Sale:
In case of consignment, account sale is
required to be submitted periodically by the consignee to the consignor. But
in case of sales no account sale is required to be submitted by the
purchaser to the seller.