Consideration is the foundation of every contract. The law enforces only those promises which are made for consideration. Where one party promises to do something, it must get something in return. This ‘something in return’ is called consideration. It is the very life-blood of every contract. In the absence of consideration or undertaking is purely gratuitous. However, sacred and binding in honor, it creates no legal obligation.
Definition: Consideration in contract law is simply the exchange of one thing of value for another. Without consideration, a contract cannot be enforced or is otherwise voidable. It has been defined in many ways –
According to Pollock – “Consideration is the price for which the promise of some other is brought and the promise is thus given for value is enforceable.”
It is something which is of some value in the eyes of law. According to section 2 (d) of the Indian Contract Act defines consideration as –
(a) When at the desire of the promisor,
(b) The promise or any’ other person,
(c) Has done or abstained from doing, or does or abstain from doing, or promises to do or abstain from doing,
(d) Something, such act or abstinence or promise is called a consideration for the promise.
Example: A agrees to sell his horse to B for Rs. 1000. Here A’s promise’ to sell Iii horse is for B’s consideration to pay Rs. 1000 is A’s consideration to sell his horse to B.