A contract is any agreement between two or more parties that is enforceable by law. Knowingly or unknowingly, we get into a lot of contracts in our day to day activities, for example, we get into a contract with the restaurant when we go to the restaurant and order food. We are obligated to pay the restaurant bill. similarly, we are getting into a contract with the shopkeeper when we go to the shop to buy some goods, we are obligated to pay for the foods purchased. The law that governs all such contracts is called contract law. Contracts are an inherent part of our life. The contract law was officially enacted through the Indian Contracts Act,1872 in India. It came into force on the first day of September 1872. The Indian contracts act earlier contained the partnership act and sale of goods act within itself. Contract was defined by Salmond as an agreement creating and defining obligation between the parties. Halsbury defined contract as an agreement between two or more persons which is intended to be enforceable at law and is contracted by the acceptance by one party of an offer made to him by the other party to do or abstain from doing some act. The major intention behind entering into a contract is to gain some sort of benefit. If there was no benefit then why would any one what to get into a contract. It is also understood that all the parties are gaining some kind of benefit from the contract. One can wonder that contracts are for the benefit of two or more parties and what does law have to do with it? It is important to know that all agreements do not become contracts. This means that only those agreements that are legally valid are considered to be contracts. For example, if A enters into an agreement with B to sell Drugs (in a country where drugs are considered illegal), then this agreement will be considered illegal and will not be considered as a contract because it is not enforceable by the law of the land. The first provisions of The Indian Contracts Act,1872 says that it is applicable to the whole of India. The Indian contracts act gives various steps to explain the process of entering into a contract. The second section of the Indian Contracts act says that one person makes an offer by conveying his/her willingness to do or abstain from doing anything, to obtain the assent of the other party/partiers (section 2(a)). Then the person to whom the assent is made, responds to the offer made by the offeror by accepting the offer (section 2(b)). After accepting the offer, the parson who makes the proposal or offer is called the promisor and the person Accepting it is called promisee (section 2(c)). As explained earlier both the parties enter into a contract to gain some benefit from the contract and this is called quid pro quo, which means something in return for something. The parties give something or perform an act to receive something in return. This is called as the consideration for the act. It is explained in the section2(d) of the Indian Contracts ac,1872. Consideration is the one of the most important elements of a contract. An agreement is a promise or a set of promises having a consideration for each other (section 2(e)). Section 2(h) of the Indian contracts act,1872 defines a contact as an agreement enforceable by Law. and if the agreement is not enforceable by law, it is considered to be void (section 2(i)). If an agreement in enforceable by law as to one or more parties and not enforceable by law as to the other parties, then it will be considered as a voidable contract (section 2(j)). A contract may initially be valid and may become void.
An agreement must have some essential elements to make it a valid contract. these elements are written given in the Section 10 of the Indian Contracts Act,1872. There are five elements that are called essential elements of a contract. the first element is consent. It is important for the parties to willingly enter into a contract and not with any external force or pressure or any other reason. The consent of the parties must therefore be freely granted by their will. This also means that both the parties are agreeing to the same aspects of the contract in the same sense. Consent is explained in the section 13 of the act and further elaborated in the section 14, section 15, section 16, section 17, section 18, section 20, section 21 and section 22 of the Indian Contract Act ,1872. The parties must be competent to contract to enter into a valid contract. this means that a minor or a person who is of unsound mind or a person disqualified by the law to contract cannot enter into a contract. this concept is explained in the section 11 and section 12 of the Act. As explained under section2(d) there must exist a valid consideration between the parties. The consideration may not be unlawful of illegal. this is explained under section 24 and section 25 of the act. There must be a lawful object behind the contract and if not, the contract will not be considered void. Another essential element is that the contracts must not be expressly declared to be void by the law. This is explained under section 26, section 27, section 28, section 29, section 30. The chapter 3 of the Indian contracts act,1872 talks about contingent contracts. This includes sections 31 to 36. The chapter 4 of the Indian contracts act,1872 explains the performance of contracts. This includes sections from 37 to 67. The chapter 5 of the Indian contracts act,1872 explains about certain relation that resemble those created by contracts. This includes sections from 68 to 72. The chapter 6 of the Indian contracts act,1872 talks about the consequences of the breach of contracts. This includes sections from 73 to 75. This is the general contracts. Special contracts are contained in Sections 124 to 238 of the Indian Contract Act. The special contracts are guarantee, bailment, pledge etc.. and such contracts may not strictly follow the essentials of contract as according to sec.10 of the Indian Contract Act,1872.
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