CMA Intermediate · Business Laws and Ethics · Indian Contracts Act, 1872
Ishaan, a majority-age adult of sound mind, signs a written agreement with Jaya. Which statement about the effect of the Act on formalities is correct?
The Act leaves untouched any other law that requires a contract to be in writing or witnessed, or that relates to registration of documents. It neither imposes such formalities on all contracts nor abolishes them.
- AThe Act does not affect any law requiring a contract to be in writing or witnessed, or relating to registration of documentsCorrect
- BThe Act abolishes all requirements of writing for contracts
- CThe Act requires every contract to be registered
- DThe Act requires two witnesses for every contract
Explanation
The second paragraph of Section 10 preserves laws in force that require writing, witnesses or registration. The Act itself does not impose these for every contract, nor does it abolish them.
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