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Indian Contract Act 1872 Details

The Indian Contract Act, 1872 defines a contract as an agreement enforceable by law, consisting of an offer and acceptance, with essential elements including lawful consideration, capacity, free consent, and legal object. It categorizes contracts based on validity, formation, performance, and obligation, distinguishing between valid, void, voidable, illegal, and unenforceable contracts. Additionally, contracts can be express, implied, quasi, executed, executory, or unilateral/bilateral depending on their nature and obligations.

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32 views2 pages

Indian Contract Act 1872 Details

The Indian Contract Act, 1872 defines a contract as an agreement enforceable by law, consisting of an offer and acceptance, with essential elements including lawful consideration, capacity, free consent, and legal object. It categorizes contracts based on validity, formation, performance, and obligation, distinguishing between valid, void, voidable, illegal, and unenforceable contracts. Additionally, contracts can be express, implied, quasi, executed, executory, or unilateral/bilateral depending on their nature and obligations.

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Indian Contract Act, 1872

Definition of Contract

According to Section 2(h) of the Indian Contract Act, 1872:

"A contract is an agreement enforceable by law."

Related Definitions:

- Agreement [Section 2(e)]: Every promise and every set of promises, forming the consideration for each

other.

- Promise [Section 2(b)]: When the person to whom the proposal is made signifies his assent thereto, the

proposal is said to be accepted. A proposal when accepted becomes a promise.

Thus: Contract = Agreement + Legal Enforceability

Essential Elements of a Valid Contract

1. Offer and Acceptance: Clear and unambiguous agreement between parties.

2. Intention to Create Legal Relationship: Both parties must intend for the agreement to be legally binding.

3. Lawful Consideration: Something of value must be exchanged.

4. Capacity of Parties: Must be major, of sound mind, and not disqualified by law.

5. Free Consent: Consent must be free from coercion, undue influence, fraud, misrepresentation, or mistake.

6. Lawful Object: The object of the contract must be legal and not against public policy.

7. Not Declared Void: Contract must not be one declared void by law.

8. Possibility of Performance: Performance must be possible.

9. Certainty of Terms: Terms must be clear and certain.

10. Legal Formalities: Must meet legal requirements if prescribed.


Indian Contract Act, 1872

Kinds of Contracts

A. Based on Validity:

- Valid Contract: Enforceable by law.

- Void Contract: No legal effect.

- Voidable Contract: Enforceable at the option of one party.

- Illegal Contract: Forbidden by law.

- Unenforceable Contract: Cannot be enforced due to technical defects.

B. Based on Formation:

- Express Contract: Terms are stated in words.

- Implied Contract: Formed through conduct.

- Quasi-Contract: Imposed by law.

C. Based on Performance:

- Executed Contract: Fully performed.

- Executory Contract: To be performed in the future.

- Partly Executed/Executory: One party performed, the other yet to.

D. Based on Obligation:

- Unilateral Contract: Only one party makes a promise.

- Bilateral Contract: Both parties exchange promises.

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