Question

Every promise and every set of promises, forming the consideration for each other is known as

• A. Consideration
• B. Agreement
• C. Contract
• D. Reciprocal Promises

Answer 1

The Correct Option is B

The Correct Option is (B):Agreement

Answer 2

This question tests the basic definitions given in Section 2 of the Indian Contract Act, 1872, which distinguishes a proposal, a promise, an agreement, and a contract from one another. Let's look at each option against the statutory definition.

1. Consideration: Consideration is defined in Section 2(d) as something done, given, or promised at the desire of the promisor. It is only one ingredient that goes into forming a valid contract, it is not the name given to the whole promise and counter-promise structure, so this option does not fit the definition asked.
2. Agreement: Section 2(e) of the Act states in as many words that every promise and every set of promises, forming the consideration for each other, is an agreement. This is the exact statutory wording used in the question, so this is the term being defined.
3. Contract: Section 2(h) defines a contract as an agreement enforceable by law. A contract is therefore an agreement plus the added element of legal enforceability, a step beyond a bare agreement, not the same thing as the promise-consideration structure described in the question.
4. Reciprocal Promises: Section 2(f) defines reciprocal promises as promises which form the consideration, or part of the consideration, for each other. This is close in wording but is a narrower, specific category used later in the Act, in Sections 51 to 58, to deal with the order of performance of such promises, not the general definition of an agreement itself.

Since Section 2(e) directly defines every promise and every set of promises forming the consideration for each other as an agreement, option (B) is the one that matches the statutory language word for word.

So, the correct answer is Agreement.