The Indian Contract Act, 1872
10. What agreements are contracts
All agreements are contracts if they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void.
Nothing herein contained shall affect any law in force in 1India, and not hereby expressly repealed, by which any contract is required to be made in writing 2or in the presence of witnesses, or any law relating to the registration of documents.
Breach of statutory provision
Railway invited tenders for the supply of jaggery to the railway grain shops. The respondent submitted his tender for the supply of 14,000 imperial maunds of cane jaggery during the month of February and March and the tender was accepted by the letter. So far, the offer of a supply of a definite quantity of jaggery during a specified period at a certain rate and the acceptance of the offer would constitute an agreement, but would fall short of amounting to a legal contract inasmuch as the date of delivery of the jaggery was not specified. Once the order is placed for such supply on such dates, that order amounts to a binding contract making it incumbent on the respondent to supply jaggery in accordance with the terms of the order and also making it incumbent on the Dy. General Manager to accept the jaggery delivered in pursuance of that order; Union of India v. Maddala Thathaiah, (1964) 3 SCR 774.
What agreements are Contract
If entering into a contract containing prescribed terms and conditions is a must under the statute then that contract becomes a statutory contract. If contract incorporates certain terms and conditions in it, which are statutory then the said contract to that extent is statutory; Thermal Power Ltd. v. State of Madhya Pradesh, AIR 2000 SC 1005.
In order to constitute a contract, both the parties must consent to the agreement; Steel Authority of India Ltd. v. Salem Stainless Steel Suppliers, AIR 1994 SC 1415.
A person who by reason of infancy is incompetent to contract cannot make a contract within the meaning of the Act. The question whether a contract is void or voidable presupposes the existence of a contract within the meaning of the Act, and cannot arise in the case of an infant; Mohoribibi v. Dharmodas Ghose, (1903) 30 IA 114.
What agreements are not Contract
Agreement subject to ratification by others who are not parties to it is not a conclusive contract; M.V. Shankar Bhat v. Claude Pinto (Deceased) by LRs, (2003) 4 SCC 86.
1. Subs. by Act 3 of 1951, sec. 3 and Sch., for “Part A States and Part C States”. Earlier the words “Part A States and Part C States” were substituted by the A.O. 1950, for the words “the Provinces”.
2. See e.g., sec. 25, the Copyright Act, 1957 (14 of 1957), section 19, the Carriers Act, 1865 (3 of 1865) sections 6 and 7; the Companies Act, 1956 (1 of 1956) sections 12, 30, 46 and 109.