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Indian Contract Act, 1872 – Section Summary

SectionRuleKey ConceptCase Law
2Definitions (offer, acceptance, consideration, agreement, contract)Explains basic terms used in contract law. Helps understand how a contract is formed.Carlill v Carbolic Smoke Ball Co.
3Communication of OfferOffer is communicated when it comes to knowledge of the other person.Lalman Shukla v Gauri Dutt
4Communication when CompleteCommunication is complete at different times for offer and acceptance.Adams v Lindsell
5Revocation (taking back)Offer or acceptance can be taken back before it is complete.Byrne v Van Tienhoven
6How Revocation HappensOffer ends by notice, time lapse, rejection, or death.Ramsgate Victoria Hotel v Montefiore
7Acceptance RulesAcceptance must be absolute (clear) and unqualified (no changes).Hyde v Wrench
8Acceptance by ConductAcceptance can happen by doing an act (action).Carlill v Carbolic Smoke Ball Co.
9Express and Implied PromisesPromises can be spoken/written or understood from conduct.Brogden v Metropolitan Railway Co.
10Valid ContractAgreement must have free consent, lawful object, and consideration.Mohori Bibee v Dharmodas Ghose
11Competency (capacity)Parties must be major, sound mind, and not disqualified by law.Mohori Bibee v Dharmodas Ghose
12Sound MindPerson must understand contract and its effect.Inder Singh v Parmeshwardhari Singh
13ConsentConsent means both parties agree on same thing in same sense.Raffles v Wichelhaus
14Free ConsentConsent must not be caused by force, fraud, mistake etc.Chikkam Ammiraju v Chikkam Seshamma
15Coercion (force)Using force or threat to get agreement.Chikkam Ammiraju v Chikkam Seshamma
16Undue InfluenceOne party uses position to dominate the other.Raghunath Prasad v Sarju Prasad
17FraudIntentional false statement to cheat.Derry v Peek
18MisrepresentationFalse statement made without intent to cheat.Redgrave v Hurd
19Voidable AgreementsContract can be cancelled if consent not free.Long v Lloyd
20Mistake of FactAgreement is void if both parties are mistaken about fact.Couturier v Hastie
21Mistake of LawMistake of Indian law is not valid excuse.Grant v Borg
23Lawful Consideration/ObjectObject must be legal and not against law.Gherulal Parakh v Mahadeodas Maiya
24Partly Unlawful AgreementIf part is unlawful, whole agreement may become void.Nordenfelt v Maxim Nordenfelt Guns
25Agreement without ConsiderationAgreement without consideration is void, with some exceptions.Kedarnath Bhattacharji v Gorie Mohamed
26Agreement in Restraint of MarriageAgreement stopping marriage is void.Lowe v Peers
27Restraint of TradeAgreement restricting business is void (with exceptions).Nordenfelt v Maxim Nordenfelt Guns
28Restraint of Legal ProceedingsAgreement restricting legal rights is void.Food Corporation of India v New India Assurance Co.
29Uncertain AgreementAgreement with unclear meaning is void.Scammell v Ouston
30Wagering AgreementBetting agreements are void.Carlill v Carbolic Smoke Ball Co.
31Contingent ContractContract depends on happening of future event.N.P.O. v State of Madras
32Enforcement of Contingent ContractContract enforced when event happens.Frost v Knight
37Performance of ContractParties must perform their promises.Taylor v Caldwell
39Refusal to PerformIf one party refuses, other can end contract.Hochster v De La Tour
40Personal ContractsIf contract depends on personal skill, must be done by that person.Robinson v Davison
46Time for PerformanceIf no time fixed, must be done in reasonable time.Startup v Macdonald
52Order of PerformanceWhen order is fixed, must follow that order.Bank of India v O.P. Swarnakar
53Preventing PerformanceIf one party prevents, contract can be cancelled.Holme v Guppy
54Reciprocal PromisesIf one party fails, other need not perform.Kingston v Preston
56Impossibility (Frustration)Contract becomes void if impossible to perform.Taylor v Caldwell
62NovationOld contract replaced by new one.Scarf v Jardine
63Remission (less performance)Promisee can accept lesser performance.Kedarnath Bhattacharji v Gorie Mohamed
64Effect of Voidable ContractIf cancelled, benefits must be returned.Long v Lloyd
65Obligation of Person who Received AdvantageIf contract void, benefits must be returned.State of West Bengal v B.K. Mondal
70Non-Gratuitous ActIf work done lawfully, payment must be made.State of West Bengal v B.K. Mondal
72Money Paid by MistakeMoney paid by mistake must be returned.Sales Tax Officer v Kanhaiya Lal
73Compensation for BreachDamages given for loss due to breach.Hadley v Baxendale
74Compensation for PenaltyCourt gives reasonable compensation even if penalty fixed.Fateh Chand v Balkishan Das
75Right to RescindParty cancelling contract can claim damages.Hochster v De La Tour