Page 1 - 01. Indian Contract Act, 1872

Contract Act, 1872

 It extends to whole of India, except the state of Jammu & Kashmir.

Meaning of Contract:
 Sec 2(h) of Indian Contract Act defines contract as: “ An agreement enforceable

by law”.

Contract = Agreement + enforceability by law

Contract is made by acceptance of one party of an offer made to him by the other party.
To do or abstain from doing some act.

Contract = Agreement +obligation

Meaning of Agreement & Promise:
 Sec 2(e) of Indian Contract Act defines it as,

“ Every‟ promise or very act of promises forming consideration for each other”.

 It has two characteristics
(i) Two or more persons are required to make an agreement.

(ii) Both parties must agree to same thing in same sense. (Consensus – ad –

idem).
 Sec 2(b) of Indian Contract defines promise as, “ A proposal when accepted

becomes a promise”.
Agreement = Promise

= Accepted proposal
= Offer + Acceptance

Meaning of Obligation

 It refers to the legal duty to do or abstain from doing what one has promised to
do or abstain from doing .

Rights & Obligations
 They are created between the parties as a result of a binding contract.

 They are correlative

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