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Under section 62 of the Indian Contract Act, 1872, what is the parties' agreed substitution of a new…

Novation replaces the original contract with a new contract by agreement. Section 62 separately recognizes rescission and alteration. A new promise that leaves the old…

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Under section 62 of the Indian Contract Act, 1872, what is the parties' agreed substitution of a new contract for the whole of an existing contract called?

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Correct answer B

Novation replaces the original contract with a new contract by agreement. Section 62 separately recognizes rescission and alteration. A new promise that leaves the old contract in force does not amount to novation.

Option feedback

Option A

Rescission cancels the existing contract. The question describes an agreed replacement contract.

Option B

Novation is the agreed substitution of a new contract in place of the original contract.

Option C

Renovation is not a mode of discharge under section 62.

Option D

Alteration changes the terms of the existing contract. Novation replaces the original contract.

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