Consideration-Definition and essentials

When a party to an agreement promises to do something, he must get “something” in return .This “something” is defined as consideration.

The essentials or legal rules of a valid consideration are as under:-

  1. It must move at the desire of the promisor:

In order to constitute legal consideration the act or abstinence forming the consideration for the promise must be done at the desire or request of the promisor.


X saves Y’s house from the fire without being asked to do so. X cannot demand payment for his services because X performed this act voluntarily and not at the desire of Y.

  1. It may move from the Promisee or any other person:

The second essential of a valid consideration is that consideration may move from the promisee or from a third person on his behalf.

[Chinnaya v. Ramayya ]

  1. It may be past, present or future:

Consideration may be past present or future.

A) Past Consideration:

When the consideration for a present promise was given before the date of the promise it is called a past consideration. It is not a valid consideration.

B) Present Consideration:

When consideration is given simultaneously by one party to another at the time of contract, it is called Present Consideration. The act constituting the consideration is wholly or completely performed.


A sells a book to B and B pay its price immediately it is a case of present consideration.

C) Future Consideration:

When the consideration on both sides is to be given at a future date, it s called future consideration or executory consideration. It consists of promises and each promise is a consideration for the other.

  1. It need not be Adequate:

It is not necessary that consideration should be adequate to the value of the promise. The law only insists on the presence of consideration and not on its adequacy. It is for the parties to the contract to consider the adequacy of consideration and the courts are not concerned about it.


A agrees to sell his car worth Rs.20000 for Rs.5000 only and his consent is free. The agreement is valid contract.

  1. It must be real:

It is necessary that consideration must be real and competent. Example:

A promise to put life in X’s dead body on B’s promise to pay him Rs.1000. It is not real.

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