As per the Indian Contract Act, an agreement is :
Every promise and every set of
promises, forming the consideration for each other, is an agreement;”
So when a person makes a promise, it is
an offer by the person which when accepted by the other resulting in an
agreement. When an agreement is enforceable by law, it is a contract. So a
contract is a valid agreement but the same cannot be said vice versa since not
every agreement is not a valid contract. So, an agreement should also have the
following essential elements:
- For this, first, the person has to make an offer – The initial step
is when the person offers;
- Once an offer is made, then another person has to accept it ;
- Lawful object, that is the legality of the object is also
important;
- Then comes, lawful consideration;
- In addition to the above, the capacity to contract is also an
important element.
Also, free consent of the parties to
the agreement is as important as above. Agreements are in both written form as
well as oral.
What Is A Void Agreement?
In the Act, 1872, it says that:
An agreement not enforceable by law is
said to be void;”
So such agreements which cannot be
enforced by law are void contracts and it means that a contract that cannot be
enforced either of the parties. Contracts become void when the agreement is
related to any unlawful or impossible acts which are against law and so cannot
be enforced. Also, agreements become void when the object and consideration is
unlawful.
A void contract is not a valid one from
the beginning itself and so the performance of the contract is not possible. It
does not exist and cannot be enforced by law.
What Is A Voidable Agreement?
Voidable contract as per the Act :
An agreement which is enforceable
by law at the option of one or more of the parties thereto, but not at the
option of the other or others, is a voidable contract;”
Voidable agreements are those
agreements that are made without free consent, due to any undue influence on
any party to the agreement. Also, when a party prevents the other party from
fulfilling or performing as per the promise or when a party fails to perform at
the specified time period, then the contract becomes voidable.
A voidable contract becomes invalid due to any specific lawful reasons and when one of the parties to a contract does not consider it valid. This contract exists and is valid until it is considered invalid by one of the contracting parties.
In Muhammad Khalilur Rahman
Khan vs Mohammad Muzammilullah Khan, the
Allahabad High Court noted:
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