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IAI Actuarial Core Principles · Business Management · Sources of Indian law and valid contracts

Kabir, aged 17, enters an agreement to buy a laptop from a Delhi shop on credit for Rs 60,000 and takes delivery. The shop later sues him for the price. Which statement is correct under Indian law?

The shop cannot recover the price. A minor's agreement in India is void from the start, not merely voidable, so it cannot be enforced against Kabir, and neither his taking the goods nor any later parental approval makes it valid.

  1. AThe shop can recover the price because Kabir took the benefit of the goods
  2. BThe contract is voidable at Kabir's option and he must restore the laptop
  3. CThe agreement is void ab initio, so the price cannot be recovered from Kabir personallyCorrect
  4. DThe agreement is valid if Kabir's parents had verbally approved it afterwards
  5. The agreement is valid because laptops are not luxury items

Explanation

Following Mohori Bibee v Dharmodas Ghose, a minor's agreement is void from the beginning. The shop cannot recover the price from Kabir, and later ratification on attaining majority or by parents does not validate it. Voidable treatment is the English-style error.

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