Question:

Principle:Sale of liquor is illegal. All agreements relating to prohibited items do not exist in the eyes of law.
Facts: ‘A’ entered into an agreement with ‘B’ for the sale of liquor. ‘A’ failed to supply the agreed quantity of liquor to B.

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In cases of illegal contracts, no legal action can be brought by either party in most jurisdictions.
Updated On: Jul 15, 2026
  • B can bring a legal action against A.
  • B cannot bring any legal action against A.
  • A can bring a legal action against B.
  • A and B can initiate appropriate legal proceeding against each other.
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The Correct Option is B

Approach Solution - 1

The principle provided in the question states that the sale of liquor is illegal and all agreements related to prohibited items (such as the sale of liquor) are not valid in the eyes of the law. The contract between ‘A’ and ‘B’ for the sale of liquor falls into the category of an illegal agreement. As per contract law, when an agreement is illegal, it cannot be enforced by either party, and neither party can seek legal redress for the failure to fulfill obligations under such an agreement.
Since the sale of liquor is prohibited by law, ‘B’ cannot bring a legal action against ‘A’ for failing to supply the liquor. This would violate the principle of not recognizing illegal contracts in the eyes of the law.
Thus, the correct answer is (B).
Option (A) is incorrect because the law does not allow the enforcement of an illegal contract. Option (C) is incorrect for the same reason – 'A' cannot legally take action for not fulfilling an illegal contract. Option (D) is incorrect because both parties cannot initiate legal proceedings under an illegal contract.
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Approach Solution -2

The principle states that the sale of liquor is illegal, and agreements relating to prohibited items do not exist in the eyes of the law. A and B entered into an agreement for the sale of liquor, and A failed to supply the agreed quantity. Let's test each option against this principle.

  1. B can bring a legal action against A: This would require the agreement between A and B to be legally valid, but since it concerns liquor, a prohibited item, the principle treats it as non existent in the eyes of the law, so it cannot be enforced by either party.
  2. B cannot bring any legal action against A: Since the agreement is for the sale of liquor, a prohibited item, the principle treats it as non existent in the eyes of the law. A non existent agreement gives neither party an enforceable right, so B has no legal ground to sue A.
  3. A can bring a legal action against B: The facts describe A's failure to supply, not any default by B, so this option does not even fit the facts, and the same illegality would in any case bar A from suing too.
  4. A and B can initiate appropriate legal proceeding against each other: This assumes the agreement is enforceable enough to support lawsuits from both sides, but an agreement involving an illegal, prohibited item is treated as void from the start.

Because the agreement was for the sale of liquor, a prohibited item the principle treats as legally non existent, B cannot bring any legal action against A for failing to supply it.

Therefore, the correct answer is B cannot bring any legal action against A.

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Approach Solution -3

The principle's necessary condition is that the subject matter be a prohibited item, and once that condition is met, the consequence is that the agreement does not exist in the eyes of the law at all. We can test each option by checking whether this condition and consequence apply to an agreement for the sale of liquor.

  1. B can bring a legal action against A: This requires the agreement to carry enough legal weight to be enforced; but liquor is expressly a prohibited item, triggering the principle's non-existence consequence, so no enforceable right arises for either side.
  2. B cannot bring any legal action against A: This follows directly once the necessary condition, a prohibited subject matter, is met, since a legally non-existent agreement gives B no ground to sue.
  3. A can bring a legal action against B: The facts describe A's own failure to supply, not any default by B, so this does not even match the facts, and the same non-existence consequence would bar A from suing in any case.
  4. A and B can initiate appropriate legal proceeding against each other: This assumes some residual enforceability survives the illegality, contradicting the principle's flat statement that such agreements do not exist in law.

Since the agreement concerns liquor, a prohibited item, the principle's non-existence consequence applies, leaving B with no legal action against A.

Therefore, the correct answer is B cannot bring any legal action against A.

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