A sold some land to B. At the time of sale both the parties believed to be in good faith that the area of the land sold was 10 hectares. It however, turned out that the area was 7 hectares only. How is the contract of sale affected?

A bilateral mistake (both parties mistaken) about a fundamental fact essential to the contract - here, the actual area of the land - can make the agreement void. Since both parties believed the area was 10 hectares when it was actually only 7 hectares, this mutual mistake about a material fact affects the contract's validity.