UNIT – 03 (DETAILED NOTES)

1. Contract Law Under the Indian Legal System

Introduction

A contract is a legally enforceable agreement between two or more persons. In India, contract laws
are governed mainly by the Indian Contract Act, 1872. It lays down the rules regarding formation,
validity, performance, and discharge of contracts.

Definition

Section 2(h), Indian Contract Act, 1872:

Thus,
Agreement + Enforceability = Contract

Essential Elements of a Valid Contract

1. O er and Acceptance

 One party makes a lawful o er.

 Other party gives lawful acceptance.

 Must be communicated clearly and unconditionally.

2. Intention to Create Legal Relations

Social agreements (e.g., dinner invitation) are not contracts.

3. Lawful Consideration

Something of value must be exchanged (money, services, etc.).

4. Capacity of Parties

Parties must be:

 Above 18 years

 Of sound mind

 Not disqualified by law

Consent must not be obtained through:

 Coercion

 Undue influence

 Fraud

 Misrepresentation

 Mistake

6. Lawful Object

Object must not be illegal, immoral, or opposed to public policy.

7. Possibility of Performance

The act must be capable of being performed.

8. Certainty of Terms

Contract must be clear; vague terms are void.

9. Not Expressly Declared Void

Certain agreements (like wagering contracts) are void.

Types of Contracts

 Valid Contract

 Void Contract

 Voidable Contract

 Illegal Contract

 Unenforceable Contract

 Express & Implied Contracts

 Executed & Executory Contracts

A contract may be discharged by:

1. Performance

2. Mutual agreement

3. Impossibility

4. Lapse of time

5. Breach

6. Operation of law

Remedies for Breach

1. Damages (compensation)

2. Specific performance

3. Injunction

4. Quantum meruit

5. Rescission

Importance of Contract Law

 Facilitates business transactions

 Protects rights of parties

 Ensures fairness and predictability

 Forms backbone of commercial law

2. Tribunals in India

Introduction

Tribunals are quasi-judicial bodies created to reduce the burden on regular courts and provide
speedy, specialized, and low-cost justice. They operate under Article 323-A and 323-B of the
Constitution.
Purpose of Tribunals

 Resolve specialized disputes

Types of Tribunals

(A) Administrative Tribunals

Created under Article 323-A.

 Central Administrative Tribunal (CAT)

 State Administrative Tribunal (SAT)

(B) Tribunals under Article 323-B

For matters like:

 Taxation
 Industrial disputes
 Land reforms
 Elections
 Consumer protection
 Company laws

Important Tribunals in India

1. National Company Law Tribunal (NCLT)

 Deals with corporate disputes

 Insolvency and Bankruptcy Code (IBC)

2. National Green Tribunal (NGT)

 Environmental cases

 Conservation of forests and wildlife

4. Consumer Disputes Redressal Commissions

 District/State/National Levels

5. Armed Forces Tribunal (AFT)

Powers and Functions of Tribunals

 Pass judgments and orders

 Summon witnesses

 Enforce attendance

 Admit evidence

 Appeal authority in specified matters

Advantages

 Speedy justice

 Low cost

 Subject expertise

 Flexible procedures

Limitations

 Sometimes lack independence

 Appeals still go to courts

 Quality varies across states

3. Indian Judicial System

Introduction

India follows a single, integrated, and independent judicial system. The judiciary interprets laws,
protects fundamental rights, and ensures justice.
Structure of Judicial System

1. Supreme Court of India (Top Court)

 Established under Article 124

 Highest court of appeal

 Guardian of Constitution

 Exercises Judicial Review

 Deals with:

o Constitutional cases

o Inter-state disputes

o Appeals from High Courts

2. High Courts (State Level)

 One in every state or for a group of states

 Supervises lower courts

 Issues writs under Article 226

 Hears civil & criminal appeals

3. Subordinate Courts

(a) District Courts

Headed by District Judge.

(b) Sessions Courts

Handle criminal cases including murder, rape, etc.

(c) Civil Courts, Family Courts, Magistrate Courts

Lower courts handling local disputes.

 Independent (free from government control)

 Integrated (single hierarchy)

 Accessible (courts at multiple levels)

 Guardian of Fundamental Rights

Role of Judiciary

 Interprets laws

 Protects Constitution

 Ensures rule of law

 Checks misuse of power

 Resolves conflicts

4. Legislative Assembly (Vidhan Sabha)

Introduction

Legislative Assembly is the lower house of the State Legislature. It represents the people of the state.

Composition

 Members elected directly through elections

Powers and Functions

1. Legislative Powers

 Makes laws on State List subjects

 Shares powers on Concurrent List subjects

 Controls state budget

 Money Bill can be introduced only in Legislative Assembly

3. Executive Powers

 Council of Ministers is responsible to the Assembly

 Can remove government through No-Confidence Motion

4. Electoral Functions

 Participates in the election of:

o President

o Rajya Sabha members

5. Constitutional Powers

 Approves Constitutional Amendments (where required)

Importance

 Directly represents people

 Controls state government

 Makes laws essential for state development

5. District Court & District Consumer Forum

Introduction

District Court is the highest court at the district level for civil and criminal matters. It functions
under the supervision of the High Court.

Structure

 District Judge → Civil matters

 Sessions Judge → Criminal matters

Functions

 Hears appeals from lower courts

 Handles major civil disputes

 Tries serious criminal o ences

 Supervises all magistrate and civil courts

 Maintains law and order through judicial role

Powers

 Pass decrees in civil cases

 Pass sentences including life imprisonment

 Grant bail

 Hear appeals

B. District Consumer Forum (District Consumer Disputes Redressal Commission)

Introduction

Formed under the Consumer Protection Act, it resolves consumer disputes at district level.
Functions

 Handles complaints regarding:

o Defective goods

o Deficient services

o Unfair trade practices

Powers

 Order refund or replacement

 Award compensation

 Penalize erring traders or service providers

 Conduct investigation and examinations

Importance

 Protects consumer rights

 Quick and a ordable justice

 Encourages fair business practices