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What is the effect of agreeing to give up a bona fide disputed claim as part of a lawful settlement…

Under section 2(d) of the Indian Contract Act, 1872, an act or abstinence at the promisor’s request can constitute consideration. A party’s agreement to give up a bona fide…

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What is the effect of agreeing to give up a bona fide disputed claim as part of a lawful settlement under the Indian Contract Act, 1872?

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Correct answer D

Under section 2(d) of the Indian Contract Act, 1872, an act or abstinence at the promisor’s request can constitute consideration. A party’s agreement to give up a bona fide disputed claim in a lawful settlement can therefore supply consideration.

Option feedback

Option A

Contract law allows consideration in the form of a requested abstinence.

Option B

A dispute over the underlying claim does not by itself make a lawful settlement void.

Option C

Giving up a bona fide claim is a form of abstinence that can support a promise.

Option D

Giving up a bona fide disputed claim as part of the bargain can supply consideration.

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