Question

Which one of the following statements is correctly worded?

• A. In India, consideration must follow from promisee only.
• B. In India, consideration must follow from only promisor or only promisee.
• C. In India, consideration must follow from promisor or any other person.
• D. In India, consideration must follow from promisee or any other person.

Hint:

Under Indian law, consideration may move from the promisee or any other person, unlike English law where it must move from the promisee only. This distinction is known as the "Doctrine of Privity of Consideration."

Answer 1

The Correct Option is D

Step 1: Understanding the Concept.
Section 2(d) of the Indian Contract Act, 1872, defines "consideration." It states that when, at the desire of the promisor, the promisee or any other person has done or abstained from doing something, such act or abstinence or promise is called a consideration for the promise.

Step 2: Explanation.
This definition clearly establishes that consideration in India may move from the promisee or any other person, provided it is done at the desire of the promisor. This is different from the position under English law, where consideration must move only from the promisee.
- Option (A): Incorrect — reflects the English law principle, not Indian law.
- Option (B): Incorrect — consideration does not move from the promisor.
- Option (C): Incorrect — consideration cannot move from the promisor; it must move from the promisee or a third person at the promisor's desire.
- Option (D): Correct — accurately states the Indian legal position as per Section 2(d).
Step 3: Final Answer.
Hence, under Indian law, consideration can move from the promisee or any other person, making Option (D) the correct answer.