THE INDIAN CONTRACT ACT : COMPLETE E-BOOK

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UNIT-4

CHAPTER-2

THE INDIAN CONTRACT ACT

OBJECTIVE OF THE ACT

The Objective of the Contract Act is to ensure that the rights and obligations arising out of a contract are honoured and that legal remedies are made available to an aggrieved party against the party failing to honour his part of agreement. The Indian Contract Act makes it obligatory that this is done and compels the defaulters to honour their commitments.

The Act as enacted originally had 266 Sections, it had wide scope and

General Principles of Law of Contract – Sections 01 to 75

Contract relating to Sale of Goods – Sections 76 to 123

Special Contracts- Indemnity, Guarantee, Bailment & Pledge and Agency – Sections 124 to 238

Contracts relating to Partnership – Sections 239 to 266

At present the Indian Contract Act may be divided into two parts:

Part 1: deals with the General Principles of Law of Contract Sections 1 to 75

Part 2: deals with Special kinds of Contracts such as

Contract of Indemnity and Guarantee

Contract of Bailment and Pledge

Contract of Agency…………..

INDIAN CONTRACT ACT-1872

Interpretation-clause.—In this Act the following words and expressions are used in the following senses, unless a contrary intention appears from the context:—

(a) When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal;

(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;

(c) The person making the proposal is called the “promisor”, and the person accepting the proposal is called the “promisee”;

(d) When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise;

(e) Every promise and every set of promises, forming the consideration for each other, is an agreement;

(f) Promises which form the consideration or part of the consideration for each other are called reciprocal promises;

(g) An agreement not enforceable by law is said to be void;

(h) An agreement enforceable by law is a contract;

(i) An agreement that is enforceable by law at the option of one or more of the parties thereto,

but not at the option of the other or others, is a voidable contract;

(j) A contract that ceases to be enforceable by law becomes void when it ceases to be enforceable…………………………

CHAPTER I

THE COMMUNICATION, ACCEPTANCE AND REVOCATION OF PROPOSALS
1. Communication, acceptance and revocation of proposals.—The communication of proposals
the acceptance of proposals, and the revocation of proposals and acceptances, respectively, are deemed to be made by any act or omission of the party proposing, accepting or revoking by which he intends to communicate such proposal, acceptance or revocation, or which has the effect of communicating it.. ……………………….READ MORE