Multiple choice

Companies XYZ and ABC agreed that XYZ shall pay ABC Rs. 1000, for which ABC shall afterwards deliver to XYZ either rice or smuggled opium. Which of the following is the type of contract in relation to the facts given above?

  1. Void contract

  2. Valid contract to deliver rice

  3. Wagering contract

  4. Contingent contract

  5. None of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

According to Section 58 of the Indian Contract Act, in case of an alternative offer and acceptance (one branch of which is legal and the other illegal), the legal branch alone can be enforced. Illegal will be void. Thus, the contract is valid to deliver rice and void to deliver smuggled opium.

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