Question

A past consideration under Indian Law

• A. Invalid
• B. Valid
• C. Void
• D. Voidable

Hint:

Note this key difference: Indian law accepts past, present, and future consideration. English law generally only accepts present (executory) and future (executed) consideration, not past consideration (with some exceptions).

Answer 1

The Correct Option is B

Step 1: Understanding the Concept:
The question asks about the validity of 'past consideration' under the Indian Contract Act, 1872. Consideration is the 'quid pro quo' or 'something in return' that is essential for a valid contract.
Step 2: Detailed Explanation:
The definition of consideration is given in Section 2(d) of the Indian Contract Act. It states: "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..."
The phrase "has done or abstained from doing" explicitly recognizes acts that were completed in the past as valid consideration for a present promise, provided the past act was done at the desire of the promisor.
For example: A requests B to find his lost dog. B finds the dog. A then promises to pay B Rs. 1000. Here, the act of finding the dog is a past consideration for A's promise to pay, and the contract is valid under Indian law.
This is a notable difference from English law, where past consideration is generally not considered good consideration.
Step 3: Final Answer:
The Indian Contract Act, under Section 2(d), explicitly recognizes past consideration as valid. Therefore, option (B) is the correct answer.