Site navigation

Under Section 62 of the Indian Contract Act, 1872, 'novation of a contract' means:

Section 62 provides that the original contract need not be performed if the parties agree to substitute a new contract for it, rescind it or alter it. Novation is the first…

Choose your answer

Under Section 62 of the Indian Contract Act, 1872, 'novation of a contract' means:

Select one answer
Answer and explanation

Correct answer B

Section 62 provides that the original contract need not be performed if the parties agree to substitute a new contract for it, rescind it or alter it. Novation is the first of these alternatives. The statutory illustrations include substitution involving a new party.

Option feedback

Option A

Extending the term alone leaves the existing contract in place.

Option B

Novation occurs when the parties agree to replace the original contract with a new one.

Option C

Rescission by agreement discharges the existing contract without requiring a substitute.

Option D

An alteration changes terms of the existing contract without necessarily replacing it with a new contract.

Practice for these exams

Related exam syllabi

Related questions in this topic