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There was a contract to supply oil-seeds. But the Government rendered the sale and purchase of oilseed…

Under the second paragraph of section 56 of the Indian Contract Act, 1872, a contract becomes void when, after it is made, performance becomes impossible or unlawful through…

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There was a contract to supply oil-seeds. But the Government rendered the sale and purchase of oilseed illegal under the Defence of India Rules. Identify the effect.

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Correct answer C

Under the second paragraph of section 56 of the Indian Contract Act, 1872, a contract becomes void when, after it is made, performance becomes impossible or unlawful through an event the promisor could not prevent. The later prohibition under the Defence of India Rules made the sale unlawful, so "Both parties are discharged from the performance of such contract" and neither party is liable for default.

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