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CMA Foundation · Fundamentals of Business Laws and Business Communication · Capacity of Parties, Free Consent

Ravi, a trader in Pune, buys a machine from Meena believing it is an imported model, though Meena made no statement on the point and did not know of his belief. The machine is in fact locally made. Ravi seeks to avoid the contract. Under the Indian Contract Act, 1872, what is the position?

The contract is not voidable. Under Section 22, a contract is not voidable merely because one party was under a mistake as to a matter of fact. Since Meena made no representation causing the belief, Ravi's unilateral mistake gives him no right to avoid it.

  1. AVoidable at Ravi's option because he was mistaken
  2. BVoid because consent was not free
  3. CThe contract is not voidable merely because Ravi was under a mistake as to a matter of factCorrect
  4. DVoidable at Meena's option

Explanation

Section 22 states that a contract is not voidable merely because it was caused by one party's mistake as to a matter of fact. Meena made no misrepresentation or fraud, so Ravi cannot avoid the contract on this ground alone.

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