Question

Frustration of contract implies

• A. Commercial hardship
• B. Physical impossibility due to disappearance of the subject-matter of the contract or the object has failed to materialize
• C. Both (a) and (b)
• D. None of the above

Hint:

Frustration under Section 56 requires impossibility, not mere difficulty or financial loss.

Answer 1

The Correct Option is B

Under the Indian Contract Act, 1872, frustration of contract (Section 56) occurs when performance becomes impossible due to unforeseen events, such as the destruction of the subject matter. Commercial hardship does not constitute frustration. Thus, the correct answer is: \[ {\text{Physical impossibility due to disappearance of the subject-matter of the contract or the object has failed to materialize}} \]