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Under section 56 of the Indian Contract Act, 1872, in which of the following cases does supervening…

Section 56 discharges a contract when subsequent events make performance impossible or unlawful, including destruction of its essential foundation. Mere difficulty, reduced…

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Under section 56 of the Indian Contract Act, 1872, in which of the following cases does supervening impossibility or illegality NOT discharge the contract? Assume no express contractual provision allocates these risks.
I. Mere difficulty in performance, with performance still possible and the contractual foundation intact.
II. An outbreak of war that makes the agreed performance unlawful by an event the promisor could not prevent.
III. Mere loss of commercial profitability, with performance still possible and the contractual foundation intact.
IV. Temporary strikes, lockouts or civil disturbances that neither make performance impossible or unlawful nor destroy the contractual foundation.

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Answer and explanation

Correct answer C

Section 56 discharges a contract when subsequent events make performance impossible or unlawful, including destruction of its essential foundation. Mere difficulty, reduced profitability and temporary disturbances do not meet that test on the stated facts, while the specified wartime illegality does.

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