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Section 63, Contract Act 1872: Promisee May Dispense With Or Remit Performance Of Promise

Section 63 under the Chapter IV (Of the performance of contracts, Contracts which must be performed) of the Contract Act, 1872 of India - 'Promisee may dispense with or remit performance of promise', is reproduced hereunder:—

“Every promisee may dispense with or remit, wholly or in part, the performance of the promise made to him, or may extend the time for such performance, or may accept instead of it any satisfaction which he thinks fit.

Illustrations

(a) A promises to paint a picture for B. B afterwards forbids him to do so. A is no longer bound to perform the promise.

(b) A owes B 5,000 rupees. A pays to B, and B accepts, in satisfaction of the whole debt, 2,000 rupees paid at the time and place at which the 5,000 rupees were payable. The whole debt is discharged.

(c) A owes B 5,000 rupees, C pays to B 1,000 rupees, and B accepts them, in satisfaction of his claim on A. This payment is a discharge of the whole claim.

(d) A owes B, under a contract, a sum of money, the amount of which has not been ascertained. A, without ascertaining the amount, gives to B, and B, in satisfaction thereof accepts, the sum of 2,000 rupees. This is a discharge of the whole debt, whatever may be its amount.

(e) A owes B 2,000 rupees, and is also indebted to other creditors. A makes an arrangement with his creditors including B, to pay them a composition of eight annas in the rupee upon their respective demands. Payment to B of 1,000 rupees is a discharge of B's demand.”




Extra Notes for Readers

(1) Also refer relevant section 135 (Discharge of surety when creditor compounds with, gives time to, or agrees not to sue, principal debtor).
(2) With reference to illustration (c) as mentioned above - further refer section 41 (Effect of accepting performance from third person) - click here.
(3) The word 'composition' in illustration (e) as mentioned above was substituted for word "compensation" by Act 12 of 1891.

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