Report No. 103
3.4. Section 16(3).-
Section 16(3) of the Contract Act provides that, where a person who is in a position to dominate the will of another, enters into a contract with him, and the transaction appears, on the face of it or on the evidence adduced to be unconscionable, the burden of providing that such contract was not induced by undue influence shall lie upon the person in a position to dominate the will of the other. But this sub-section has been interpreted1 as meaning that both the elements of dominant position and the unconscionable nature of the contract will have to be established, before the contract can be said to be brought about by undue influence. This decision, though given so long ago, has not been departed from, with the result that section 16(3) is not of much relevance in the present context.
1. Poosathurai v. Kannappa Chettair, 1919 ILR 43 Mad 546 (PC).