Indian Contract Act, 1872 Consideration

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Consideration is defined as something in return. In simple words consideration can be defined as the amount paid to receive the advantage under a contract. It is a general rule there cannot be a valid contract without consideration. It is important to note that if there is consideration it should also be lawful. There are certain rules provided in Indian Contract Act 1872and for a consideration to be lawful should fulfill these conditions.
 
As per Section 2(d) of the Indian Contract Act 1872 “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”.
 
RULES FOR A VALID CONSIDERATION
             Consideration must move only at the desire of the promisor: If the case consideration is not moved at the desire of the promisor it will not be considered as a valid Consideration.  Leading Case Durga Prasad v. Baldeo
             Consideration may move from the promisee or any other person: Though it is important that consideration must move at the desire of the promisor, however it is immaterial who moves it. It can be moved by promisee or any other person. Leading Case Chinnayya Vs. Ramayya
             Consideration may be past, present or future: In India consideration may by past present or future as defined in section 2(d)
             Consideration may be an act or an Act of abstinence: A valid Consideration may be to do something or to abstain from doing something. Examples of act of abstinence as a valid consideration Forbearance to Sue, Compromise with creditors.
             A valid Consideration may not be adequate: For a valid Contract there must be a Valid and Lawful Consideration. However it may not be adequate to return consideration.
             A valid Consideration must be real and not illusionary
             A valid Consideration must not be for what promisor is already bound to do
             A valid Consideration must not be illegal, immoral or opposed public policy
 

 READ ONLINE NOTES FOR CONSIDERATION FOR CSEET

  
PRIVITY OF A CONTACT: It means Stranger To A Contract Can Not Sue
A Contract Creates Jus in Personam  which means Right against a person.  General rule is that a Contract cannot provide any right or liability to any stranger to a contract or to the person who is not the party to the contract. There are certain exceptions to this rule.
             In the case of trusts, the beneficiary may enforce the contract even though he is not the party to the contract
             In case of Family Settlement or family partition any member of Hindu family may sue for the enforcement of the contract
             In case of Assignment of A Contract a stranger may enforce the contract
             In case of Contracts through Agents a stranger may enforce the contract
             In case of Contracts Covenants running with the land if the stranger has the notice to such covenant.
 
NUDUM PACTUM: Contract without Consideration Ares Void
 
 For a valid contract it is important that there must be a valid consideration. Even if the consideration is insufficient it is enough to make contract valid.  As general rule a contract without consideration are void. Still there are certain exceptions where a contract without consideration shall valid.
             Love and Affection
             Compensation for Voluntary Services
             Promise to Pay a Debt Barred by Limitation Act
             Completed gifts
             Charity
 Read More About Contract Which are Valid without Consideration
 
Students preparing for CSEET (CS Executive Entrance test) must study these online notes and then practice for CSEET online test series for topic consideration from CSEET Subject Legal Aptitude and Logical Reasoning

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