Agreement without consideration, void, unless it is in writing and registered, or is a promise to compensate for something done, or is a promise to pay a debt barred by limitation law
Section 25 of the Indian Contract Act, 1872 deals with agreement without consideration, void, unless it is in writing and registered, or is a promise to compensate for something done, or is a promise to pay a debt barred by limitation law. An agreement made without consideration is void, unless (1) it is expressed in writing and registered under the law for the time being in force for the registration of [documents], and is made on account of natural love and affection between parties standing in a near relation to each other ; The Act came into force on 01 Sep 1872.
An agreement made without consideration is void, unless
(1) it is expressed in writing and registered under the law for the time being in force for the registration of 1[documents], and is made on account of natural love and affection between parties standing in a near relation to each other ; or unless
(2) it is a promise to compensate, wholly or in part, a person who has already voluntarily done something for the promisor, or something which the promisor was legally compellable to do; or unless;
(3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorized in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits.
In any of these cases, such an agreement is a contract.
Explanation 1.Nothing in this section shall affect the validity, as between the donor and donee, of any gift actually made.
Explanation 2.An agreement to which the consent of the promisor is freely given is not void merely because the consideration is inadequate; but the inadequacy of the consideration may be taken into account by the Court in determining the question whether the consent of the promisor was freely given.
Illustrations
(a) A promises, for no consideration, to give to B Rs. 1,000. This is a void agreement.
(b) A, for natural love and affection, promises to give his son, B, Rs. 1,000. A puts his promise to B into writing and registers it. This is a contract.
(c) A finds Bs purse and gives it to him. B promises to give A Rs. 50. This is a contract.
(d) A supports Bs infant son. B promises to pay As expenses in so doing. This is a contract.
(e) A owes B Rs. 1,000, but the debt is barred by the Limitation Act. A signs a written promise to pay B Rs. 500 on account of the debt. This is a contract.
(f) A agrees to sell a horse worth Rs. 1,000 for Rs. 10. As consent to the agreement was freely given. The agreement is a contract notwithstanding the inadequacy of the consideration.
(g) A agrees to sell a horse worth Rs. 1,000 for Rs. 10. A denies that his consent to the agreement was freely given.
The inadequacy of the consideration is a fact which the Court should take into account in considering whether or not As consent was freely given
Section 25, The Indian Contract Act, 1872 (Act 9 of 1872).
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Ranganayakamma v. K.S. Prakash
Court's Decision & Legal Precedent
Judgment of Main Case order-9.pdf 2008-05-16 labelled Judgment (index). CA 3635/2008. Sinha. VERIFY warning on cache reuse; body is the named reportable family-partition judgment. A registered family partition/relinquishment is not void under Contract Act s.25 merely because sisters took Re.1; love and affection / a family arrangement can sustain it, and a voidable deed must be set aside rather than ignored. Fraud was not particularised. Map s.25 only. Do not pad 13/17/19 (not isolated). Do not remap CPC 151.
On this section: A family partition/relinquishment is not void under s.25 merely for Re.1 consideration; love and affection can sustain a family arrangement (Ranganayakamma).
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National Insurance Co. LTD vs Seema Malhotra
Court's Decision & Legal Precedent
When an insured gives a cheque towards payment of insurance premium and the cheque is subsequently dishonoured by the bank due to insufficiency of funds, the insurer is not liable to the insured or their legal heirs to honour the insurance contract or pay claims arising from accidents that occurred before the cheque was dishonoured. This is because: (1) a cheque is a conditional promise to pay, not actual payment; (2) Section 64-VB of the Insurance Act requires that premium must be received before the insurer assumes any risk; (3) an insurance contract consists of reciprocal promises, and when the insured fails to pay the premium, the insurer is absolved from providing coverage; (4) the insurer's statutory liability to third parties under the Motor Vehicles Act is distinct from and does not extend to claims by the insured or their legal heirs.
On this section: Agreement made without consideration is void; applied to hold that without valid premium payment, no contract of insurance is formed
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Dharampeth Grihanirman Sahakari Sanstha vs Nagpur Improvement Trust
Court's Decision & Legal Precedent
When parties have entered into a clear, unambiguous development agreement without objection, been fully aware of its terms and conditions, and have substantially acted upon its beneficial provisions, they cannot later selectively repudiate clauses they find disadvantageous. In the context of land development agreements between private land owners and government planning authorities, where the agreement provides for composite consideration including abandonment of statutory acquisition, permission to commercially develop and exploit land, and reciprocal transfer of public utility land, such agreements are binding and enforceable. Courts should read such agreements in their totality rather than in isolation, and may not unilaterally rescind clauses on grounds of unconscionability merely because one party is a government agency, particularly where the non-governmental party has enjoyed substantial benefits and does not challenge the agreement contemporaneously. The principle 'qui approbat non reprobat' (one who approbates cannot reprobate) applies with full force to prevent a party from accepting beneficial terms while rejecting onerous ones from the same agreement.
On this section: Agreements without consideration - cited by appellant to argue unregistered and unstamped agreement for free transfer is void; court distinguished this by finding composite consideration in development benefits
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… The relevant portion of the impugned order is reproduced as under: 43. By an absolutely perverse finding and without there being any evidence to prove that there was a promise to pay a time barred debt by the petitioner in accordance with Section 25 (3) of the Indian Contract Act, the arbitrator has passed the impugned award against the petitioner which has to be necessarily set aside by this Court. Apart from determining the amount payable towards refund of the unutilized sums of money, allegedly retained by the petitioner which was meant for purchase of …
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… Key answer of the PSC is "C", however, in accordance with the opinion of the expert, the correct answer is "D". The expert has given following reasonings in support of his opinion :- Section 25 of the Indian Contract Act, 1872 provides that agreement without consideration would be void unless it is in writing and registered or a promise to compensate for something done or is a promise to pay a debt barred by limitation law. Sub-Section (1) of Sec. 25 provides that the contract would not be void if it is …
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… Key answer of the PSC is "C", however, in accordance with the opinion of the expert, the correct answer is "D". The expert has given following reasonings in support of his opinion :- Section 25 of the Indian Contract Act, 1872 provides that agreement without consideration would be void unless it is in writing and registered or a promise to compensate for something done or is a promise to pay a debt barred by limitation law. Sub-Section (1) of Sec. 25 provides that the contract would not be void if it is …
Questions about Section 25
What have the courts held on Section 25 of the Indian Contract Act?
Ranganayakamma v. K.S. Prakash (16 May 2008) is the leading judgment on this section among those set out below: A family partition/relinquishment is not void under s.25 merely for Re.1 consideration; love and affection can sustain a family arrangement (Ranganayakamma). Another 2 judgments on this section are set out below, all of them from the Supreme Court. They run from 2001 to 2016.
How do I find court cases under Section 25 of the Indian Contract Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Contract Act 25, section 25 Contract Act, section 25 of the Indian Contract Act. People searching for it also type contract act 25 3 and contract act 25 1960. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 3 reported judgments on this section are set out on this page, beginning with Ranganayakamma v. K.S. Prakash (16 May 2008).
When did Section 25 of the Indian Contract Act come into force?
Section 25 of the Indian Contract Act, commonly called consideration, and cited as Contract Act 25, came into force on 01 Sep 1872, having been enacted on 25 Apr 1872. It is in force as at the date shown on this page.
Other sections of this Act
- 73. Compensation for loss or damage caused by breach of contract1822 words
- 23. What considerations and objects are lawful, and what not596 words
- 74. Compensation for breach of contract where penalty stipulated for577 words
- 28. Agreements in restraint of legal proceeding void512 words
- 16. "Undue influence" defined397 words
- 133. Discharge of surety by variance in terms of contract393 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 14 Oct 2026. This page is not a substitute for legal advice.