Indian Contract Act 1872
Unit I
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.
Extent and Commencement
•It extends to the whole of India except the
State of Jammu and Kashmir
•It came into force on the first day of
September, 1872.
•The sale of Goods was repealed from this
Indian Contract Act in 1930. Contracts relating
to partnership were repealed in 1932.
Present Contract Act
•Basic Principles of Contract (Sections 1 to 75)
•Indemnity and Guarantee (Sections 124 to
147)
•Bailment (Sections 148 to 181)
•Agency (Sections 182 to 238)
Proposal
•When one person signifies to another his
willingness to do or to abstain from doing
anything, with a view to obtaining the assent
of the other to such act or abstinence, he said
to make a proposal.
Promise
•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.
•The person making the proposal is called the
“Promisor” and the person accepting the
proposal is called the “Promisee”.
Consideration
•When at the desire of the promisor, the
promise or any other person has done or
abstained from doing, or does or abstains