Government of India
Bare Act As Per The Government of India

Section 11 of Indian Contract Act

11. Who are competent to contract.— Every person is competent to contract who is of the age of majority according to the law to which he is subject, and who is of sound mind, and is not disqualified from contracting by any law to which he is subject.

MCQs Based on Section 11 of the Indian Contract Act, 1872

Q1. Who among the following is not competent to contract under Section 11 of the Indian Contract Act, 1872?

A. A person who is 25 years old and of sound mind
B. A minor
C. A person not disqualified by law
D. A person of sound mind

Answer: B. A minor

Explanation: As per Section 11, a person must be of the age of majority to be competent to contract. A minor (below 18 years) is not competent to contract.

Q2. What is the minimum age required to enter into a valid contract in India (in general cases)?

A. 16 years
B. 18 years
C. 21 years
D. 17 years

Answer: B. 18 years

Explanation: As per the Indian Majority Act, 1875, the general age of majority is 18 years, unless a court-appointed guardian is involved, in which case it is 21 years.

Q3. A contract made by a minor is:

A. Valid
B. Voidable
C. Void ab initio
D. Enforceable with consent

Answer: C. Void ab initio

Explanation: In the famous case Mohori Bibee v. Dharmodas Ghose, it was held that a contract with a minor is void from the beginning (void ab initio) and cannot be enforced.

Q4. A person who is usually of unsound mind, but occasionally becomes of sound mind, can enter into a contract:

A. Anytime
B. Only when of sound mind
C. Only with court’s permission
D. Never

Answer: B. Only when of sound mind

Explanation: A person must be of sound mind at the time of entering the contract. If they are sane at that moment, the contract is valid.

Q5. Which of the following is not a condition for competency to contract under Section 11?

A. Person must be of majority age
B. Person must be literate
C. Person must be of sound mind
D. Person must not be disqualified by law

Answer: B. Person must be literate

Explanation: Literacy is not a requirement under Section 11. A person can enter into a contract even if illiterate, provided other conditions (majority age, sound mind, not disqualified) are met.

Q6. Which of the following laws governs the age of majority in India?

A. Indian Penal Code
B. Indian Evidence Act
C. Indian Majority Act, 1875
D. Constitution of India

Answer: C. Indian Majority Act, 1875

Explanation: The Indian Majority Act, 1875 defines the age of majority as 18 years, or 21 years if a guardian is appointed.

Q7. A person disqualified by law to contract cannot enter into a valid contract. Which of the following is an example?

A. A teacher
B. A company acting beyond its Memorandum
C. A shopkeeper
D. A housewife

Answer: B. A company acting beyond its Memorandum

Explanation: A company cannot enter into a contract beyond the scope of its Memorandum of Association. Such contracts are ultra vires and void.

Q8. A drunken person enters into a contract. It is:

A. Valid
B. Voidable
C. Illegal
D. Void ab initio

Answer: B. Voidable

Explanation: If a person is so intoxicated that they cannot understand the contract, it is voidable at the option of the intoxicated person.

Q9. Under Indian Contract Act, the term “sound mind” means:

A. Ability to make money
B. Ability to run a business
C. Ability to understand the contract and make rational decisions
D. Ability to argue in court

Answer: C. Ability to understand the contract and make rational decisions

Explanation: A person is said to be of sound mind if they are capable of understanding the contract and can make decisions about their interest rationally at the time of making the agreement.

Q10. Which landmark case established that a minor’s contract is void ab initio in India?

A. Carlill v. Carbolic Smoke Ball Co.
B. Donoghue v. Stevenson
C. Mohori Bibee v. Dharmodas Ghose
D. Kedar Nath v. Gauri Mohamed

Answer: C. Mohori Bibee v. Dharmodas Ghose

Explanation: This is the leading case in Indian contract law which held that a contract with a minor is completely void from the beginning and cannot be enforced.

Section 11: Condition-Based Practice Questions

Question 1:

Condition: Ramesh is 19 years old, of sound mind, and is not disqualified by any law.

Question: Is Ramesh competent to enter into a contract?

Answer: Yes, Ramesh is competent to contract.

Explanation: As per Section 11, a person who is (i) of the age of majority (18+), (ii) of sound mind, and (iii) not disqualified by any law, is competent to contract. Ramesh meets all these conditions.

Question 2:

Condition: Fatima is 17 years old and wants to sign a rental agreement for a flat.

Question: Can Fatima enter into a valid contract under Indian Contract Act?

Answer: No, Fatima cannot enter into a valid contract.

Explanation: Since she is a minor (below 18 years), any contract entered into by her is void ab initio under Section 11.

Question 3:

Condition: Ajay is 30 years old but currently under the influence of heavy alcohol when signing a contract.

Question: Is Ajay competent to contract?

Answer: No, Ajay is not competent to contract at that time.

Explanation: Even though Ajay is of majority age and not disqualified by law, he is not of sound mind while intoxicated, so the contract is voidable.

Question 4:

Condition: Seema is 21 years old and has been declared an insolvent by the court.

Question: Can Seema enter into any contract?

Answer: Seema is competent for general contracts but may be disqualified for certain contracts (e.g., dealing with property).

Explanation: An insolvent person is not completely barred from contracting, but certain contracts like transfer of property may be restricted under law.

Section 11: Problem-Based Practice Questions

Problem 1:

Problem: Rahul, a 17-year-old boy, enters into a contract with a mobile phone company to buy a smartphone on monthly installment payments. After paying two installments, Rahul refuses to pay further and claims that he is not legally bound.

Question: Is the contract valid and enforceable against Rahul?

Answer: No, the contract is not valid and cannot be enforced against Rahul.

Explanation: Under Section 11, Rahul is a minor, and any contract with a minor is void ab initio. Therefore, the mobile phone company cannot enforce the agreement.

Problem 2:

Problem: Suresh, who suffers from intermittent mental illness, entered into a property sale agreement during a time when he was mentally unstable. The buyer now wants to enforce the contract.

Question: Is the contract valid and enforceable?

Answer: No, the contract is not valid.

Explanation: A person must be of sound mind at the time of making the contract. Since Suresh was of unsound mind, the contract is voidable and not enforceable.

Problem 3:

Problem: An American diplomat in India signs a lease agreement for a private office space. Later, he refuses to pay the rent, claiming he is exempt due to diplomatic status.

Question: Is the diplomat bound by the contract?

Answer: No, the diplomat may not be bound depending on diplomatic immunity laws.

Explanation: Under Section 11, persons disqualified by law (including foreign sovereigns or diplomats) may not be competent to contract. Enforcement will depend on international and domestic law provisions.

Problem 4:

Problem: Kavita, 22 years old and of sound mind, enters into a contract to sell land that legally belongs to her minor brother, acting as his guardian, without court approval.

Question: Is the contract valid?

Answer: No, the contract is not valid.

Explanation: A guardian cannot sell a minor’s property without court permission. Though Kavita is competent herself, the contract involves a minor’s interest, making it invalid without proper legal sanction.

Final Thoughts

This section highlights three important conditions to be eligible for entering into a valid contract:

Person must be of the age of majority

Example: If a 17-year-old boy signs a contract to buy a bike, the contract is not valid, and it cannot be enforced in a court of law.

Person must be of sound mind

Important Note: If a person is usually of unsound mind, but was of sound mind at the time of making the contract, then that contract is valid.

Example: A person suffering from mental illness who is mentally stable for a short time and makes a contract during that time – the contract will be valid.

Person must not be disqualified by any law

Even if a person is a major and of sound mind, he or she may still be disqualified by law to make a contract. Some examples include:

Conclusion

Section 11 of the Indian Contract Act clearly defines the qualifications of a person to make a valid contract. It ensures that:

can enter into legal agreements. This protects the interests of all parties involved and avoids misuse or unfair dealings, especially with minors or people of unsound mind.