Contracts play a vital role in our daily lives, and it’s essential to be aware of the various provisions under the Indian Contract Act.
SECTION 62 (Effect of Novation, Rescission, and Alteration of Contract) :
This section states that if a contract is altered, rescinded, or substituted by a new contract with the consent of all parties involved, the original contract ceases to exist. The performance of the original contract becomes unnecessary, and the parties are bound by the terms of the new agreement.
SECTION 63 (Promisee May Dispense with or Remit Performance of Promise) :
Under this section, the promisee has the right to dispense with the performance of a promise made to them, or they can also accept any performance different from what was originally promised. However, this power can only be exercised by the promisee, and not by any third party.
SECTION 64 (Consequence of Rescission of Voidable Contract) :
When a contract becomes voidable due to coercion, fraud, misrepresentation, or undue influence, the party with the power to rescind the contract has the right to do so. Once the contract is rescinded, both parties are released from their respective obligations, and any consideration exchanged must be returned.
SECTION 65 (Obligation of person who has received advantage under void agreement, or contract that becomes void) :
This section states that if a person receives any advantage under a void agreement or a contract that becomes void, they are bound to compensate the other party for the value of the advantage received. The compensation can be in the form of money or any other agreed-upon method.
SECTION 66 (Mode of Communication of Revocation or Rescission) :
This section deals with the mode of communication for revocation or rescission of a contract. It states that the revocation or rescission must be communicated in the same manner as the original contract or by any other reasonable means.
SECTION 67 (Mode of Revocation or Rescission When revoking or rescinding a contract) :
This section specifies that the revocation or rescission must be made in a manner similar to that of making an offer or acceptance. It should be communicated to the other party or their authorized agent.
Understanding the provisions mentioned in sections 62 to 67 of the Indian Contract Act is crucial when dealing with contracts that need not be performed. These sections provide clarity on novation, rescission, alteration, and compensation in case of voidable or void agreements. By being aware of these provisions, individuals can ensure that their contractual rights and obligations are upheld.
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