AMITY UNIVERSITY
JHARKHAND
COURSE: Law Of Contract
COURSE CODE: LAW119
PROGRAMME: BBA-LLB(H)(SEMESTER 1)
PRESENTED BY:
AKASH KUMAR A36021520001
SUBMITTED TO:-
MS. Palak Jawa
Assignment 3
The influence of the English Common Contract Law over the Indian Contract Act
The Indian law of Contract is somewhat based on the English Common Law of Contract’s
principals. The ICA (Indian Contracts Act) has borrowed extensively from provisions that
govern the contracts law in other countries, but mainly it is based on English Common Law.
Indian courts have considered English Common Law in the absence of express provision in
contract act. This States the reason of the Indian Law remaining same as the English law in
aspects of the principals. The ICA, 1872 was enacted on 25th April 1872 and subsequently came
into force on the first day of September 1872. The history of the act brings to light the very
origin of the economic processes and in this regard, the importance of contracting in order to
conduct one’s business in everyday life. The English common and statue law which was in
force at that time came into India by the charters of the 18th century which established courts
in Calcutta, Madras and Bombay. There was indiscriminate application of the laws by Supreme
Court towards Hindus and Muslims which led to major inconveniences. To resolve these
problems, the statue of 1781 empowered the Supreme Court at Calcutta and the statue of 1797
empowered the courts of Madras and Bombay, to determine all actions and suits of contractual
nature against the natives of the said towns in the case of Muslims by the laws and usages of
them and in the case of Hindus which was known as “Code of Gentoo Laws ” by the laws and
usage of Hindus, where one of the parties was a Muslim or a Hindu, by the laws and usage of
defendants. The result was that in a suit of Hindus, the Hindu Law of Contract was applied and
in the case of Muslims, the Muslim laws of Contract was applied. This practise continued in
the courts until the enactment of the Indian Contracts Act in the Country.
The High Courts were introduced in the country around the year 1862 in the town of
Calcutta, Madras and Bombay. This led to the abolishment of the courts under the statue of
1781 and 1797, the Indian legislature got the power to alter the provisions of the clause 19 of
the charter of 1865. The Indian contract act was enacted to govern the matters of contract.
The Bengal regulation 3 of 1793 and madras regulation 2 of section 1802 directed the judges
in the district and city courts to act according to justice, equity and good conscience in cases
where no specific rule existed. The expression „justice, equity and good conscience‟ was
interpreted to mean the rules of English law so far applicable to the Indian society and
circumstances.
