Question

Which among the below mentioned option is correct as per the Indian Contract Act?

• A. Consideration can be present only
• B. Consideration can only be present or future
• C. Consideration can be past, present, or future
• D. Past consideration is no consideration

Hint:

Mnemonic: PPF. Consideration in India is like a bank account; it can be Past, Present, or Future.

Answer 1

The Correct Option is C

Concept: Consideration is defined under Section 2(d) of the Indian Contract Act, 1872. It is the "price" paid by one party for the promise of the other.

• Definition: "When, at the desire of the promisor, the promisee... has done or abstained from doing..."

• English vs. Indian Law: Indian law is broader regarding the timing of consideration.

Step 1: Analyzing the language of Section 2(d).
The Act uses three specific verb tenses to describe consideration.

"Has done" refers to Past Consideration.

"Does or abstains from doing" refers to Present Consideration.

"Promises to do" refers to Future (Executory) Consideration.

Step 2: Differentiating from English Law.
In English Law, "Past Consideration" is generally considered no consideration at all. However, the

Indian Contract Act specifically recognizes all three. This means if you performed a service for someone in the past at their request, and they promise to pay you today, that past service is valid consideration for the new promise.