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CMA Foundation · Fundamentals of Business Laws and Business Communication · Consideration and Legality of Object

Under Section 2(d) of the Indian Contract Act, 1872, an act, abstinence or promise is a consideration for a promise when it is done or promised:

Consideration under Section 2(d) arises when the promisee or any other person acts, abstains, or promises to do so at the desire of the promisor. The promisor's desire is essential, and the act need not come only from the promisee.

  1. AAt the desire of the promisor, by the promisee or any other personCorrect
  2. BAt the desire of the promisee, by the promisor only
  3. CAt the desire of a third party, by the promisee only
  4. DBy the promisee on his own initiative, without any desire from the promisor

Explanation

Section 2(d) requires that the act, abstinence or promise be done at the desire of the promisor. It may be done by the promisee or any other person. Option B reverses the roles of the parties, and option D ignores the requirement of the promisor's desire.

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