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Under Section 21 of the Indian Contract Act, 1872, what is the effect of a contract caused by a mistake as to a law in force in India?

Question and options

Under Section 21 of the Indian Contract Act, 1872, what is the effect of a contract caused by a mistake as to a law in force in India?

  1. It is void if the law mistaken is Indian, but not if it is foreign

  2. It is voidable at the option of the mistaken party

  3. It is not voidable merely on account of that mistake

  4. It is void, as with a mistake of fact essential to it

Answer and explanation

Correct answer: C - It is not voidable merely on account of that mistake

Section 21 of the Indian Contract Act, 1872 provides that a contract is not voidable because it was caused by a mistake as to any law in force in India. A mistake as to a law not in force in India has the same effect as a mistake of fact, so the foreign-law case falls under Section 20 instead.

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