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Report No. 13

Section 19.- For section 19 of the principal Act, the following section shall be substituted, namely:-

"19. Voidability of agreements without free consent.

(1) When consent to an agreement is caused by coercion, fraud or misrepresentation, the agreement is a contract voidable at the option of the party whose consent was so caused.

(2) A party to a contract, whose consent was caused by fraud or misrepresentation, may, if he thinks fit, claim that the contract shall be performed and that he shall be put in the position in which he would have been if the representations made had been true. Where such a claim is made, the court shall, in deciding thereon, have due regard to the following considerations -

(a) whether, and if so, how far, the claim is reasonable; and

(b) whether it is in the power of the party against whom the contract is voidable to perform it fully.

(3) Where such a claim is disallowed, the court may award compensation in money for the injury caused by the fraud or misrepresentation.

Exception.- If such consent was caused by misrepresentation, or by silence fraudulent within the meaning of section 17, the contract, nevertheless, is not voidable, if the party whose consent was so caused had the means of discovering the truth with ordinary diligence.

Explanation.- A fraud or misrepresentation which did not cause the consent to a contract of the party on whom such fraud was practised, or to whom such misrepresentation was made, does not render a contract voidable."

Indian Contract Act, 1872 Back

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