Two parties

Hello my reader friends. This is one more blog in the series of Law of Contract. This blog is discussing about "Two parties". Please read this blog till the end and share it with all law students. These are the notes for preparing exams of Law degree. 

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As per Section 2(a) of Indian Contract Act, 1872 an offer or proposal is defined as, “When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal”. Thus for a valid offer there must be at least two persons involved.

Hence a Valid Contract must involve at least two parties identified by the contact. One of these parties will make the proposal and the other is the party that shall eventually accept it. Both the parties must have either what is known as a legal existence e.g. companies, schools, organizations, etc. or must be natural persons.

To constitute a contract there must be at least two parties, i.e. one party making an offer (offeror/proposer) and the other party accepting the offer (offeree/proposee). The terms of the offer must be definite. Offer means when a person reveals to another his willingness to do or to decline from doing something. Acceptance means when the person to whom the acceptance is made signifies his assent to it.

Section 2(c) of the Indian Contract Act, 1872 defines both the parties involved in the contract as, “The person making the proposal is called the “promisor” (offeror), and the person accepting the proposal is called the “promisee” (propose)”.

For Example: In the case State of Gujarat vs Ramanlal S & Co. – A business partnership was dissolved and assets were distributed among the partners as per the settlement. However, all transactions that fall under a contract are liable for taxation by the office of the State Sales Tax Officer. However, the court held that this transaction was not a sale because the parties involved were business partners and thus joint owners. For a contract of sale, we need a buyer (party one) and a seller (party two) which must be different people.


This blog is discussing about one of the essentials of a valid contract. All the essential features of a valid contract are:

1) Two parties

2) offer and acceptance.

3) Intention to create legal relations

4) Lawful consideration

5) Capacity of parties

6) Free & Genuine consent

7) Lawful objects

8) Writing & registration - legal formalities

9) Certainty

10) Possibility of performance

11) Not expressly declared void.

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