Main Article Content
Abstract
The law of contract was enacted mainly with a view to ensure reasonable fulfilment of expectations created by the promises of the parties and also enforcement of obligations prescribed by an agreement between the parties. The Indian Contract Act is one of the oldest mercantile laws of our country. It came into effect on the 1st of September 1872 and is applicable to the whole of India with the exception of Jammu & Kashmir. Containing a total of 266 sections it is the principal law regulating contracts in India. Now contract Act, 1872 does not affect any usage or custom of trade. A minor amendment in section 28 of the Act was made by the Indian Contract (Amendment Act, 1996. The Indian contract act is largely based on the principles of English law. Even at present, where a case is not covered within the particular provisions of Indian Contract Act nor any other law in force in India the court must follow the principles of English Common Law which are not inconsistent with the Indian conditions. Generally, a contract is an agreement between two or more persons to do a particular act or abstain from doing a particular act. By entering in to a contract, it creates legal obligation between the parties. The Indian Contract Act is closely related to the Pollock's definition and the Section 2(h) of the Act clearly states that "an agreement enforceable by law is a contract." Before the enactment of the Indian Contract Act, 1872, there was no codified law governing contracts in India. Thus, where goods are sold under contract which exempts the supplier from liability and if a third party is injured by the use of them, the supplier will be liable to the third party irrespective of the exemption clause. The law of contract lays down the legal rules relating to promises: their formation, their performance, and their enforceability. Given the rapid growth and increasing importance of the outsourcing industry in India, it is pertinent to study the contractual aspects of how outsourcing transactions, especially offshore ones, are agreed upon and implemented