The principle says an agreement may be formed orally, in writing, or through conduct, meaning actions alone can create a binding agreement without any words being exchanged. A picked up a toothbrush from B's shop, handed over a cheque for Rs. 20, and left. Let's check each option against this principle.
Since the principle allows an agreement to form purely through conduct, A picking up the toothbrush and paying by cheque is enough to show an agreement was formed with B.
Therefore, the correct answer is A entered into an agreement with B.
The principle can be read as a conditional rule: if the parties' words or actions show them arriving at a common transaction, whether through speech, writing, or conduct, an agreement exists, and nothing in that rule ties the validity of the agreement to how payment is made. Applying that rule to the facts, A picked up a toothbrush, handed B a cheque for its price, and left, while B permitted this exchange to occur. Let's test each option against this rule.
Only the first option follows directly from applying the rule's condition, conduct showing mutual assent, to the facts as given, since the exchange itself satisfies that condition regardless of the payment instrument used.
Therefore, the correct answer is A entered into an agreement with B.