Time and place for the performance of the promise |Law Notes

Introduction

According to the Indian contract act, 1872 deals with description under section 2(h) as an agreement that is enforceable by law. It is determine that, the contract has numerous imperative essentials, which makes it a valid contract under this act.

All the vital requirements should be chased to make a valid and legal contract but sometimes even the parties to the contract contain satisfied these basics but then as well its legality or validity can be issues when the contract is not fulfilled in suitable time and place and in the system agreed in the contract.

It is significance that a contract is completed in suitable time and place for the reason that a postponement in its performance might aggravate and contain an consequence on the valid contract.

This act deals with Section (46 to 50) of the Time and place for performance of contract. This act detailed various rules and regulations.

Section (46-50):- Time and place for the performance of the contract under the Indian contract act-

The set of laws concerning the time and place for the performance of contact are contained in Sections 46 to 50 of the Indian Contract Act, 1872 which are following-

Section 46

Time for performance of promise, when no application is to be made and no time is specified.

Where the day for performance is not specified in the contract and the promisor himself has to act upon the promise without being asked (i.e. without any type of demand) by the promisee the promise must be performed within a reasonable time. 

In this, the reasonable time is defined to be so much time as is required, compulsory, under the valid circumstances, to do conveniently  what the contract or duty requires should be done in a particular case. Simply it means amount of time which is fairly necessary according to the contract. Hence here time is not important since a specified date for completion is not mentioned but this does not mean that the promisee does not have the right to have the contract performed by the promisor.

Moreover, the term reasonable time depends on the facts and circumstances of the case and it will as well depend on the nature of the transaction.

Illustration

A takes a loan of Rs 10,000 from B and says that he will return it to her when he receives his next salary. Here the reasonable time for performance of the contract is after A receives his next salary. 

Dinkerrai Lalit Kumar vs Sukhdayal Ramblas, 19 august, 1946, the honorable high court of Bombay held that failure to act upon the contract within reasonable time amounted to breach of contract if there was no explicit refusal to perform the contract. 

In the case of Bhadra Chand vs. Betts in which the court held that he was entitled to recover as the parties intended that time should be of the essential of the contract.

In the case of Hungerford Investment trust Ltd vs. Haridas Mundhra, the court held that unreasonably long delay in a contract cannot be regarded as reasonable. The reasonable time for performance in contract is necessary. 

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Section 47

Time and place for performance of promise, where time is specified and no application to be made.

Where the time for performance of the contract is not specified in the contract and the promisor himself has to perform the promise without being asked or requested by the promisee (i.e. without any type of demand), the promise may be performed at any time during the usual hours of business on the specified day and at the place at which the promise ought to be performed and exact date which is specified by the promisee.

Illustration

X Promises to deliver 200 bags of sugar at Y’s shop on the first October. On that day X brings the 200 bags of sugar at Y’s shop, but after the usual hour for closing it, hence the sugar’s bags are not received. It is held that X has not performed his promise. 

In the case of Saraswati Trading Agency vs. Union of India the court held that if the promisor brings the goods after the business or usual hours and they are not received then it cannot be said that the promise has been performed.

Section 48

Application for performance on certain days to be at proper time and place.

Where the day for the performance is specified in the contract and the promisor has to perform his duty only on being asked (i.e. any type of demand) by the promisee, then the promisee must first apply to the promisor (i.e. make a demand on the promisor) for the performance of the promise the duty of the promisee to apply for performance on that day. He must apply during usual business hours.

Illustration

A agrees to supply 50 bags of tea to B on 20th September. As per terms of contract, B would have to request A for performance. Thus on due date and within usual business hours, B should request A regarding a time and place of supply for tea of bags to him.

Section 49

A place for the performance of promise, where no application is to be made and no place is fixed for performance.

Where the place for performance is not specified in the contract, and the promisor himself has to perform the promise without being asked or requested by the promisee, thus it is the duty of the promisor that he must contact the promisee to decide on a reasonable place for the performance of the promise. And thereafter, he should act upon the basis at the place agreed by the promisee.

The reasonable place of performance is fixed in a contract; the promisor is bound to perform at that place only. The performance of place which is fixed in a contract must be reasonable for both the parties. The performance of the place is implies on both place for delivery of goods and place of payment also.

Illustration

X entered in to a contract for supplying 100 bags of rice to y on 20th October at a specific price. On due date of performance, X must apply to Y for determining a reasonable place and must deliver the bag of rice to him at that place and also make the payment at the same specified place.

In the case of L.N. Gupta vs. Tara Mani , 1983 the high court of the Delhi held that debtor must find the creditor in the promissory note payable on demand in which the place of payment is not specified. The payee settled in New Delhi and demanded payment there only. It was held that under sec 49 of the act it is the duty of the debtor to seek his creditor and to pay him there.

Section 50

Performance in manner or at the time prescribed or sanctioned by the promisee.

Section 50 of the Indian contract act deals with the manner and time for performance is prescribed by the promisee himself, the promise should be performed in the manner and at the time prescribed by the promisee.

The promisor must perform his promise in any manner and at any time, being prescribed by the promisee.

Illustration

• Y owes to Z, Rs. 8000. Z asks Y to deposit this amount in Z’s bank account. Y deposits the amount in Z’s account after some time bank fails and Z has no information regarding transfer of money to his account. There had been good payment by Y and in this way he is discharged from obligation.
• X owes Rs. 7000 to Y. Y agrees to agree to some goods supplied by X in the assumption of the debt. The delivery of goods will be considered as a part of the payment. 

Conclusion

Time and Place for Performance of contract under the Section 46 to 50 of Indian contract act, 1872 is for the parties to a contract to decide about the time and place of contract for the performance of contract. Specified times as well as place both are important for the good legal relationship between parties and also for contract.