CAIIB · BRBL

Meaning and Essentials of a Contract

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Banking Regulations and Business Laws — CAIIB.

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What is the definition of a contract under the Indian Contract Act, 1872?

A contract is an agreement enforceable by law. Section 2(h) of the Indian Contract Act defines it as every agreement made between two or more parties with free consent, competency, lawful consideration, and lawful object.

What is the legal meaning of 'consensus ad idem' in contract law?

Meeting of minds on the same thing in the same sense

Which Section of the Indian Contract Act, 1872 defines the term 'agreement'?

Section 2(e) defines an agreement as 'every promise and every set of promises forming the consideration for each other.' An agreement is the foundation of a contract.

Which section of the Indian Contract Act defines a 'contract'?

Section 2(h) defines a contract as enforceable agreement

What is the difference between an agreement and a contract?

All contracts are agreements, but not all agreements are contracts. An agreement becomes a contract only when it is enforceable by law, meaning it satisfies all essential elements of a valid contract.

What is an 'express contract' under the Indian Contract Act?

Contract formed by explicit words spoken or written

What are the essential elements of a valid contract under Indian law?

The essential elements include: offer and acceptance, free consent, competency of parties, lawful consideration, lawful object, certainty and possibility of performance, and the agreement must not be expressly declared void.

What is an 'implied contract' in the context of Indian law?

Contract inferred from conduct or circumstances of parties

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