CHANAKYA NATIONAL LAW UNIVERSITY

NYAY NAGAR MITHAPUR PATNA

SYLLABUS
LAW OF CONTRACT- I

MODULE I: FORMATION OF CONTRACT

1. AGREEMENT AND CONTRACT
2. PROPOSAL AND ACCEPTANCE
3. COMMUNICATION, ACCEPTANCE AND REVOCATION OF PROPOSAL AND ACCEPTANCE
4. STANDARD FORM CONTRACT

MODULE II
1. CONSIDERATION: DEFINITION, PRIVITY OF CONTRACT, PAST PRESENT AND FUTURE
CONSIDERATION
2. CAPACITY TO CONTRACT: POSITION OF A MINOR AND AN UNSOUND PERSON
3. FREE CONSENT: COERCION, UNDUE INFLUENCE, FRAUD, MISREPRESENTATION, MISTAKE

MODULE III
1. LEGALITY OF THE OBJECT AND CONSIDERATION
2. VOID AGREEMENTS: AGREEMENT IN RESTRAINT OF TRADE, MARRIAGE, LEGAL
PROCEEDINGS, AMBIGUOUS AND UNCERTAIN AGREEMENTS, AGREEMENT BY WAY OF
WAGER
3. CONTINGENT CONTRACTS

MODULE IV
1. PERFORMANCE OF CONTRACT
2. DISCHARGE OF CONTRACT
3. QUASI CONTRACTS
4. REMEDIES FOR BREACH OF CONTRACT

MODULE V: SPECIFIC RELIEF ACT, 1963

PREPARED BY: - Mrs. Sneha, Faculty of Law & Centre Coordinator Child Rights Centre, CNLU
 INTRODUCTION

Law of Contract – I
The law of contract is such an important subject which applies in almost every once life where
people are willing to create legal obligation. This branch of law deals with law relating to promises,
their formation, performance and enforceability. It is scattered over several legislations. The main
object of this course is to build the transactional capability in the students.
This paper will include a study of general principles of contracts mentioned in sections1-75 of The
Indian Contract Act, 1872. The remaining provisions of this Act will be covered separately in next
paper of III Semester – Law of Contract – II (Specific Contracts, partnership Act and Sale of Goods
Act,).
The statutory provisions would be supplemented with judicial pronouncements.
Prescribed Legislations:
(a) The Indian Contract Act, 1872
(b) The Specific Relief Act, 1963
Prescribed Books:
1. Nilima Bhadbhade, Pollock &Mulla, Indian Contract & Specific Relief Acts
2. JogaRao S. V. Cases and materials on contract LexisNexis, ButterWorths Publication.
3. Athiya, P. S. Essays on Contract, OxfordUniversity Press London.
4. Friedman Law in the changing society Univeristy Book House Delhi.
5. H.K. Saharay, Dutt on Contract – The Indian Contract Act, 1872
6. Avtar Singh, Law of Contract and Specific Relief, Eastern Book Company
Reference Books:
1. M.P.Furmston, Cheshire, Fifoot and Furmston’sLaw of Contract (16th ed., 2008)
2. J. Beatson, Anson’s Law of Contract (28th ed., 2002), English Language Book Society &
Oxford
University Press, London.
3. Cheshire and Fiefoot Cases and Materials on Contract, Butterworth’s London,
4. Moitra’s Commentries on Law of Contract, Eastern Book publications 2008.
5. McNeil Economic analysis of contractual relations 13 Stanford L. R.
Law Commission Report
1. 13th report of Law Commission of India on law of Contract.
2. 9th Report of Law Commission of India, on Specific relief Act
3. 147th Report of law Commission of India on Specific relief Act 1963.

PREPARED BY: - Mrs. Sneha, Faculty of Law & Centre Coordinator Child Rights Centre, CNLU
 TOPICS TO BE COVERED WITH CASE LAWS

Topic 1: Genesis of contract

Contract: meaning of contract, how to make, Types of Contract
Topic 2: Formation of an Agreement
Intention to create legal relationship; offer and invitation to treat; kinds of offer, communication,
acceptance and revocation of offer and acceptance; modes of revocation ofoffer - Indian Contract
Act,
1872, sections 2 – 10, Standard form of Contract.
Related case laws
1. Carlill v. Carbolic Smoke Ball Co. (1891-4) All ER Rep.127
2. Pharmaceutical Society of Great Britain v. Boots Cash Chemist
(Southern) Ltd. (1952) 2 All ER Rep. 456
3. Balfour v. Balfour (1918-19) All ER 860 (CA)
4. LalmanShukla v. GauriDatt(1913) XL ALJR 489 (All.)
5. BhagwandasGoverdhandasKediav. M/s. Girdharilal Parshottamdas& Co., AIR 1966 SC 543
6. M/s. J.K. Enterprises v. State of M.P., AIR 1997 MP 68
7. M/s. Progressive Constructions Ltd. v. Bharat Hydro Power
Corporation Ltd., AIR 1996 Del. 92
U nit 3: Consideration
Meaning; basis and the nature of consideration; Doctrine of Privity of Contract and
ofconsideration, its
exceptions; Exceptions of consideration – Indian Contract Act, 1872,sections 2(d), 2(f), 23 and 25
Related case laws
08. KedarnathBhattacharjiv. GorieMahomed(1886) 7 I.D. 64 (Cal.)
09. DoraswamiIyerv. ArunachalaAyyar(1935) 43 LW 259 (Mad.)
10. Abdul Aziz v. Masum Ali, AIR 1914 All. 22
11. Venkata Chinnaya Rau v. Venkataramaya Garu
(1881) 1 ID 137 (Mad.)
12. NawabKhwaja Muhammad Khan v. NawabHusainiBegam
(1910) LR 37 I.A. 152

Topic 4: Capacity to Contract

PREPARED BY: - Mrs. Sneha, Faculty of Law & Centre Coordinator Child Rights Centre, CNLU
Legal disability to enter into contract - Minors, persons of unsound mind ; person under legal
disability; Lunatics, idiots; Restitution in cases of minor’s agreement; Liability for necessaries
supplied to the minor -
Indian Contract Act, 1872, sections 10, 11, 12, 64, 65, 68; Specific Relief Act, 1963, section 33;
Indian Majority Act, 1875
Related case laws
13. MohoriBibee v. DhurmodasGhose(1903) 30 I.A. 114
14. Khan Gulv. Lakha Singh, AIR 1928 Lah. 609
15. Ajudhia Prasad v. ChandanLal, AIR 1937 All. 610
16. R. Lingaraj v. Parvathi, AIR 1975 Mad. 285
17. RajinderKaur v. Mangal Singh (1987) 91 PLR 444
Topic 5: Free Consent
Free consent; Definition – Coercion, Undue influence, Fraud, Misrepresentation andMistake;
Effect on contracts influenced by any factor vitiating free consent - Indian ContractAct, 1872,
sections 13 – 22
Related case laws
18. Raghunath Prasad v. Sarju Prasad (1923) 51 I.A. 101
19. Subhas Chandra Das Mushibv. Ganga Prasad Das Mushib,
AIR 1967 SC 878
20. Lakshmi Amma v. T. Narayana Bhatta, 1970 (3) SCC 159
21. Tarsem Singh v. Sukhminder Singh (1998) 3 SCC 471
Topic 6: Limitations on Freedom of Contract
Circumstances in which agreements become void or voidable, Distinction between void and
voidable agreements; Unlawful Agreements; Public policy; Agreements with unlawful
consideration in part and objects; Agreements without consideration; Agreements in restraintof
marriage; Agreements in restraint of trade; Agreements in restraint of legal proceedings;
Ambiguous and uncertain agreements & Wagering agreements -Indian Contract Act,
1872,sections 23 – 30, Contingent contract , Sec.31-36.
Related case laws
22. GherulalParakhv. MahadeodasMaiya, AIR 1959 SC 781
23. Niranjan Shankar Golikariv. Century Spinning & ManufacturingCo. Ltd., AIR 1967 SC 1098
24. Central Inland Water Transport Corpn. Ltd. v. BrojoNathGanguly(1986) 3 SCC 156(Also see
D.T.C v. D.T.C. Mazdoor Congress, AIR 1991 SC 101;Bank of India v. O.P. Swarankar, AIR
2003 SC 858)
25. Dhurandhar Prasad Singh v. JaiPrakashUniversity,AIR 2001 SC 2552

Topic 7: Discharge of a Contract

PREPARED BY: - Mrs. Sneha, Faculty of Law & Centre Coordinator Child Rights Centre, CNLU
Modes -Discharge by performance; Frustration; Supervening impossibility of performance;
Grounds of Frustration and its effect; Discharge by Agreement and Novation – IndianContract
Act, 1872, sections 37 – 67
Related case laws
26. SatyabrataGhosev. MugneeramBangur& Co., AIR 1954 SC 44
27. M/s. AlopiParshad& Sons Ltd. v. Union of India,AIR 1960 SC 588
28. Punj Sons Pvt. Ltd. v. Union of India, AIR 1986 Del. 158
29. Easun Engineering Co. Ltd. v. The Fertilizers & ChemicalsTravancore Ltd., AIR 1991 Mad.
158
Topic 8: Quasi – Contracts
Obligations resembling those created by Contract (Quasi – Contracts) : Concept and classification
- Indian Contract Act, 1872, sections 68 – 72
Related case laws
38. State of West Bengalv. S.K. Mondal& Sons, AIR 1962 SC 779
Topic 9: Remedies for Breach of Contract
(a) Damages; Types of Damages ; Basis of Assessment of Damages; Remoteness ofDamages and
Measures of Damages; Mitigation of Damages; Penalty & Liquidated Damages– Indian Contract
Act, 1872, sections 73 – 74
Related case laws
30. Hadley v. Baxendale(1843-60) All ER Rep. 461
31. AKAS Jamal v. MoollaDawood, Sons & Co. (1915) XX C.W.N. 105
32. Karsandas H. Thacker v. M/s. The Saran Engineering Co. Ltd.,AIR 1965 SC 1981
33. M/s. MurlidharChiranjilalv. M/s. HarishchandraDwarkadas,AIR 1962 SC 366
34. MaulaBuxv. Union of India, AIR 1970 SC 1955
35. Shri Hanuman Cotton Mills v. Tata Air Craft Ltd., 1969 (3) SCC 522
36. Ghaziabad Development Authority v. Union of India,
AIR 2000 SC 2003
37. Oil & Natural Gas Corporation Ltd. v. Saw Pipes Ltd.(2003) 4 SCALE 92
Topic 10: The Specific Relief Act, 1963
Recovering possession of property (Sec:- 5 to 8), Specific performance of contract (Sec:- 9 to 25),
Declaratory Decrees (Sec.- 34 to 35), Preventive Relief (Sec.- 36 to 43)

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PREPARED BY: - Mrs. Sneha, Faculty of Law & Centre Coordinator Child Rights Centre, CNLU