Author- SHIVRAJ KADLIMATTI
INTRODUCTION;-
A contract is an agreement executed by law, made between two or more parties or individuals by which rights are accessed by one or more to acts of illegal the part of the other or others. A contract is an agreement creating and defining considerations between the parties.
The Indian Contract Act, 1872 lays down general principles relating to formation and execution of contracts; rules governing the information of agreement; the various types of contracts including those o guarantee, bailment and pledge. It also contains conditions leads to breach of a contract.
The Indian Contract Act, 1872 came into force on the first day of September, 1872. The Indian Contract Act deals with the common principles and rules regulationing the contracts. The Act is separated into two parts:
— The first part (Section 1-75) related with the common rules of the law of contract, and hence applies to all contracts irrespective of their applications.
— The second part (Sections 124-238) related with certain special kinds of contracts, namely contracts of Indemnity and Guarantee, Bailment, Pledge, and Agency.
CONTRACT:-
The Indian Contract Act has defined “Contract” in Section 2(h) as “An agreement enforceable by law”. This definition indicate that a contract consists of two distinct parts.
At First, there must be an of
Proposal. Secondly, such an agreement must be implemented by law. To be implemenable, an agreement must be coupled with an obligation.
AGREEMENT:-
As per Section 2(e) of the Indian Contract Act every promise and every set of promises, forming the consideration for each other, is an agreement.
According to Section 2(b) of the Indian Contract Act “when the person to whom the offer is made declares his permission there to, the offer is said to be started. A proposal, when started, becomes a promise.
Offer or Proposal and Acceptance:-
One of the early steps in the formation of a contract includes in arriving at an agreement between the contract parties by means of an offer and acceptance. Thus, when one party (the offeror) makes a definite proposal to another party (the offeree) and the offeree accepts it in its entirety and without any qualification, la contract comes into being, assuming that all other elements are also intial.
A proposal is also termed as an offer. The word ‘proposal’ is related with the English word “offer”. An offer is a proposal by one person, whereby he expresses his willingness to enter into a contractual obligation in return for a promise, act or forbearance. Section 2(a) of the Indian Contract Act defines proposal or offer as “when one person signifies to another his willingness to do or avoiding from doing anything with a scence to obtaining the assent of that other to such act or avoidenance he is said to make a proposal”. The person making the offer is called the or offeror and the person to whom the proposal is made is called the offeree.
Rules Governing Offers
A valid offer must comply with the following rules:-
(a)An offer must be clear, definite, complete and final. It must be clear.
(b)An offer must be communicated to the offeree. An offer becomes effective only when it has been transmitted to the offeree so as to give him an opportunity to accept or reject the same.
(c)The communication of an offer may be made by express words-oral or written-or it may be made by conduct.
(d)The communication of the offer may be general or specific. Where an offer is made to a specific person it is called specific offer and it can be accepted only by that person. But when an offer is addressed to an uncertain body of individuals i.e. the world at large, it is a general offer and can be accepted by any member of the general public by fulfilling the condition laid down in the offer’.
Lacking of Offer;-
Section 6 deals with various modes of lacking of an offer. It states that an offer lacks if—
(a)It is not accepted within the specified time (if any) or after a reasonable time, if none is specified.
(b)It is not accepted in the mode prescribed or if no mode is prescribed in some usual and reasonable manner, e.g., by sending a letter by mail when early reply was requested;
(c)The offeree rejects it by distinct refusal to accept it;
(d)Either the offeror or the offeree dies before acceptance;
(e)The acceptor fails to fulfil a condition precedent to an consideration.
(f)The offeree makes a counter offer, it amounts to rejection of the offer and an offer by the offeree may be accepted or rejected by the offeror.
Acceptance;-
. Under Section 2(b) of the Contract Act when a person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A offer when accepted becomes a promise.
Rules Governing Acceptance-
(a)Acceptance may be express i.e. by words spoken or written or implied from the conduct of the parties.
(b)If a particular method of acceptance is prescribed, the offer must be accepted in the prescribed manner.
(c)Acceptance must be unqualified and absolute and must correspond with all the terms of the offer.
(d)A counter offer or conditional acceptance operates as a rejection of the offer and causes it to lapse
(e)Acceptance must be transmitted to the offeror, for acceptance is complete the moment it is transmitted . Where the offeree simply intendes to accept but does not transmitted his intention to the offeror, there is no contract. Small psychological acceptance is not enough.
(f)simple silence on the part of the offeree does not amount to acceptance.
Generally the offeror cannot frame his offer in such a way as to make the silence or inaction of the offeree as an acceptance. In other words, the offeror can describe the mode of acceptance but not the mode of rejection.
(g)If the offer is one which is to be accepted by being acted upon, no transmission of acceptance to the offeror is important, unless communication is stipulated for in the offer itself.
(h)Acceptance should be given within a fixed time and before the offer lapses or is revoked. An offer becomes inchangeable by acceptance.
An acceptance never repeats an offer. There can be no redianess to an offer which is not transmitted. Synonymous performance of conditions of an offer without the knowledge of the offer, is no acceptance.
Consideration-
Sir Fredrick Pollock has defined consideration “as an act or forbearance of one party, or the promise hence is the price for which the promise of the other is made.
The Section 2(d) of the Indian Contract Act, 1872 defines consideration “when at the willingness of the promisor, the promise or any other person has done or avoided from doing, or does or avoided 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”.
The fundamental principle that consideration is essential in every contract –
Consideration at the desire of the offerror :
The Section 2(d) of the Act begins with the statement that consideration must move at the desire or request of the promisor. This means that something which is done should have been done at the desire of the promisor and not voluntarily or not at the desire of a third party.
(a)Consideration may move from the promise or any other person : In English law, consideration must move from the promise, so that a stranger to the consideration cannot sue on the Agreement.
Kinds of Consideration be:
(a)Executory or future which means that it makes the form of promise to be performed in the future.
(b)Implemented or present in which it is an act or forbearance made or suffered for a promise. In other words, the act adds up to consideration is wholly or completely performed.
(c)Past which means a past act or forbearance, that is to say, an act constituting consideration
Rules Governing Consideration’-
(a)Every simple contact must be supported by valuable consideration otherwise it is formally void subject to some exceptions.
(b)Consideration could be an act of abstinence or promise.
(c)There must be mutuality
(d)Consideration must be real, and not vague, indefinite, or illusory.
eConsideration must be lawful.
Consideration must be something more than the promise is already bound to do for the promisor.
Void Agreement
According to Section 2 (j) of the Indian Contract Act, a contract which ceases to be implemented by law becomes void when it ceases to be enforceable. Void means a lack of existence or a unlawful
When Contract becomes Void
— An agreement not enforceable by law is void ab initio – Section 2(g).
— A contract which ceases to be implementable by law becomes void when it ceases to be enforceable – Section 2(j)
— A contract becomes illegal when, by reason of some actions which the promisor could not prevent, the performance of the contract becomes inexecutable.
— A contract becomes illegal by reason of subsequent illegality.
Breach of Contract;-
The breach of contract may be (i) actual; or (ii) anticipatory.
Breach of contract may reslut, in the intial time for performance is due. This may happen where one of the parties definitely violate the contract and show their intentions not to perform it or does some act which makes performance impossible. The other party, on such a breach being committed, has a right to act for damages.
Protection for Breach of Contract
Where a contract is violated, the injured party has several courses of action open to him. The appropriate preventions in any case will depend upon the subject-matter of the contract and the nature of the breach.
IN CASE OF BREACH OF CONTRACT, THE INJURED PARTY MAY:
End the contract and
Avoid further performance of the contractSue for damages
Under Section 65, when a party treats the contract as violated, he makes himself responsibile to give any benefits he has received under the contract to the party from whom such benefits were taken.
E – CONTRACT-
Digital contracts are not paper based but rather in digital form are born out of the need for speed, convenience and efficiency. In the technology age, the whole transaction can be completed in seconds, with dual individuals simply affixing their digital signatures to an electronic copy of the contract. The normal law relating to contracts is not sufficient to address all the issues that arise in technological agreement. The IT Act, 2000 solves .
