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Section 50: Performance in manner or at time prescribed or sanctioned by promisee

Indian Contract Act • Official Statutory Text & Practice Guide

Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 1872
Section 49 All 266 Sections of Indian Contract Act Section 51

Legal Commentary & Landmark Judgments: Section 50

Section 50 of the Indian Contract Act, 1872 codifies the principle of party autonomy regarding the mode and timing of contractual performance, providing that performance of any promise may be made in any manner, or at any time, which the promisee prescribes or sanctions.

  • Promisee's Statutory Prerogative: The promisee possesses plenary authority to prescribe, sanction, or alter the manner, method, and timing of performance (e.g., payment by cheque, post, electronic transfer, or delivery to a third-party warehouse).
  • Complete Statutory Discharge: Performance tendered strictly in accordance with the prescribed or sanctioned method constitutes a complete legal discharge of the promisor, even if the benefit is delayed or lost in transit without promisor fault.
  • Agency and Risk Shifting: Where the promisee prescribes delivery or remittance through a specific transmission agency (such as postal dispatch or a designated bank), that agency becomes the agent of the promisee, shifting all transit risks onto the promisee.
Key Landmark Precedents:
  • CIT v. Ogale Glass Works Ltd. 1955 SCR 185 / AIR 1954 SC 429: A 5-Judge Constitution Bench held that where a creditor requests payment by cheque sent through the post, the post office acts as the agent of the creditor; posting of the cheque constitutes payment under Section 50 at the place of posting.
  • Badri Prasad v. State of M.P. (1971) 3 SCC 23: The Supreme Court recognized that performance rendered in the manner sanctioned by the state or promisee satisfies the statutory requirements of Section 50, precluding claims of contractual default.
Courtroom Practice & Strategic Litigation Guidance:

When transmitting settlement funds, earnest money, or time-sensitive notices, ensure that the transmittal adheres precisely to the mode sanctioned in writing by the counterparty (e.g., RTGS to designated account, or courier to specified address). Under Section 50 r/w Ogale Glass Works, obtaining an email confirmation of the sanctioned payment method protects your client against default if funds are delayed in interbank clearance.

Section 49 All 266 Sections of Indian Contract Act Section 51