Question based Jain Assignment Solution and other course
Answer:
Section 23 declares the agreement whose either object or consideration is unlawful and void. What kinds of considerations and objects are unlawful shown as under?
- If it is Forbidden By Law, i.e. it has specifically been declared to be unlawful by any of the country for the time being in force. An act or an undertaking is forbidden by law:
- when it is liable to be punished by the criminal law of the country, or
- when it forbidden by the special legislation or regulations made by a expert authority under the powers resulting from the legislature.
Case: An agreement to pay consideration to a tenant to induce him to vacate premises governed by the Rent Restriction Act is illegal and can be enforced because such an act is forbidden by the said act [Mohanchana v. Manindra AIR (1955) Cal.442.]
Example: A agrees to sell certain gems to B which B will smuggle out of the country. The contract is unlawful.
- If it is of Such a Nature That, if Permitted, Would Defeat the Provisions of Law– This clause includes cases where the object or consideration of an agreement is of such a nature that, though not directly prohibited by law, it would indirectly lead to a breach of law, whether enacted or otherwise (e.g. Hindu and Mohammedan Laws). Such an agreement is also void.
Example: A gives a loan of Rs. 10,000 to B. B agrees not to raise the plea of limitation in case a sue has to be filed against him for recovery of loan even if it becomes time barred. The agreement is void as it defeats the provisions of the Indian Limitation Act.
Case: An agreement between husband and wife to live separately is invalid as being opposed to Hindu Law [A.E. Thimmal Naidu v. Rajammal (1968), AIR Mad. 201]
- If it is Fraudulent, i.e. the object of the contract is to cheat the other party by concealment of any material fact or otherwise.
Example: (i) A promises to pay Rs. 20,000 to B, if B would commit fraud on C. B agrees. B’s agreeing to trick is unlawful consideration for A’s promise to pay. Hence, the agreement is illegal and void.
Example: (ii) A, B and C enter into an agreement of partnership for the division profits earned by them from business as well as by illegal activities. The agreement is void, as its object is unlawful.
- If it Involves or Implies Injury to the Person or Property of Another:
Case: An agreement which compels a debtor to do manual labor for the creditor as long as the debt is not paid in full is void [Ram Sarup vs Bansi Mandar (1915) 42 Cal. 742.]
Example: An agreement to put certain property to fire is illegitimate and void under this clause.
- If the court regards it as Immoral — ‘Immorality’ depends upon the principles of morality existing at a particular time and as approved by courts. Such agreements whose object and consideration are immoral, is illegal and therefore, void. The scope of word ‘immoral’ here extends to the following:
(i) Sexual Immorality e.g. Illicit Cohabitation or Concubinage or Prostitution
Example: A agrees to let her daughter to B for concubinage. The agreement is void because it is immoral, though the letting may not be punishable under the Indian Penal Code. ( Illustration (k) to Section 23).
It is important to note that consideration paid for past cohabitation and promise to pay for future cohabitation both are immoral and thus, illegal and void. Past immoral consideration does not become right with the passage of time, it remains unlawful.
(ii) Furtherance of Sexual Immorality
Case: A prostitute was sued for the hire money of a carriage in which she used to go every evening in order to make a display of her beauty and thus to attract customers. The suit was dismissed on the ground that the plaintiff contributed towards the performance of an immoral and illegal act and hence he was liable to suffer. [Pearce v. Brooks (1866), L.R. 1 Ex. 213].
Case: A man who intentionally lets out his house for prostitution cannot recover the rent, it being an act for furtherance of sexual immorality [Choga Lal v. Piyasi (1909), All. 58]. The landlord may, however, recover if he did not know the purpose.
(iii) Interference With the Marital Status
Case: Money advanced to a married woman to enable her to procure divorce and to marry the plaintiff could not be recovered back as the object of the agreement was held immoral. [Bai Vijli v. Nansa Nagar (1885) 10 Bom. 152].
Example: An agreement for future separation between a husband and a wife is void ab initio, it being immoral in the eye of Law.
(iv) Such acts which are against Good Public Morals
Case: An agreement for future marriage, after the death of first wife is against good morals and hence would be void. [Wilson v. Cornley (1908), 1 KB. 729].
