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Which statement correctly describes immorality and public policy as grounds of unlawful consideration under section 23 of the Indian Contract Act, 1872?

Question and options

Which statement correctly describes immorality and public policy as grounds of unlawful consideration under section 23 of the Indian Contract Act, 1872?

  1. Only opposition to public policy is sufficient, and immorality is irrelevant

  2. Only immorality is sufficient, and public policy is irrelevant

  3. A description as unethical is the sole test, and the other grounds are irrelevant

  4. Either immorality or opposition to public policy is sufficient

Answer and explanation

Correct answer: D - Either immorality or opposition to public policy is sufficient

Under section 23 of the Indian Contract Act, 1872, consideration is unlawful if the court regards it as immoral or opposed to public policy. Either ground is sufficient; both need not coexist. A description as unethical, without facts placing it within a statutory ground, is not an additional independent test in section 23.

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