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Section 54 of the Transfer of Property Act defines Sale in India. Sale is the transfer of ownership in exchange for a price paid or promised or partly paid and partly promised.
Exchange is defined in Section 118 of the Transfer of Property Act. Where two  persons mutually transfer the ownership of one thing for the ownership of another, it is called an Exchange.
http://senseoflaw.blogspot.com/2012/11/minor-as-plaintiff-and-defendant-in_20.html
Now let us look into the distinctive features of both these things. In essence both are transfers. But both are having certain unique features.
There are two or more persons in Sale and Exchange. They are called Seller and Buyer.
The subject matter of sale must be specific immovable property which must be in existence at the time of transaction. The consideration for sale is money only. The subject matter of exchange is not only money. Money may become part of the transaction to equate certain transfers. But in exchange, another property is given in consideration of the transfer. It is just like barter system. For instance, A gives his plot worth one lakh rupees to B and in turn B gives his house worth seventy thousand and an amount of thirty thousand rupees to A. This is called an exchange.
In Transfer of Property Act, there can be sale of only immovable property. But there can be exchange of movable property.

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