-BY Pranya Arora, Bba.Llb (H)

Vivekananda Institute of Professional Studies (VSLLS)




The case of Lalman Shukla v Gauri Dutt is one of the famous landmark judgments under the Indian Contract Act and is based upon the principle of Valid acceptance. The case was filed in Allahabad high court in 1913 and the judgment was held by Hon’ble Justice J. Banerjee.

The Indian Contract Act 1872 [1]explains valid acceptance in Section 2 (b) as “When the person to whom the proposal has been made signifies his assent thereto, the offer is said to be accepted. Thus, the proposal when accepted becomes a promise.” [2]

“When the person to whom the offer is made signifies his consent thereto, the proposal is said to be accepted. A proposal, when accepted, becomes a promise.”[3][4][5]

This benchmark case is based on the command that if the proposal is not known at all then no acceptance to the proposal is made, hence the proposal is void and no damages can be claimed for the same.


In the case, the nephew of the defendant went from his home quietly and no one was ready to find him. The defendant assigned his servants to several places to search for his nephew. All the servants left for Haridwar to search for the nephew of the defendant. The defendant for their way handed over some money for travel and used it on their other expenses.

While the defendant announced handbills demanding that if anyone finds his nephew and brings him back then he would be remunerated with Rs. 501. In Haridwar, the plaintiff found the nephew of the defendant and communicated the likewise to the defendant, and brought him back to Cawnpore. The plaintiff on his arrival was rewarded with two sovereigns and twenty rupees. The plaintiff satisfied with the award and started with his usual daily work.[6]

After 6 months, the defendant withdrew the plaintiff from work due to some conflict. [7]Consequently, the plaintiff claimed Rs. 499 as the award for tracing the defendant’s nephew. The plaintiff asserted that while leaving for Haridwar, with the expenses and other gifts, he was further assured to be paid Rs. 501. The central demand of the plaintiff against the defendant was that he did not present him with an award even after finishing the given task.


  1. Whether the judgment delivered by the lower court is correct?
  2. Can the action of the plaintiff be termed as a valid acceptance of the proposal addressed by the defendant?
  3. Can this be considered a valid contract?
  4. Whether the award of Rs. 499 challenged by the plaintiff should be granted?



The petitioners firmly argued that the performance of an act is adequate for granting awards associated with such performance. They declared that it is unnecessary that whether the person performing the act knows the awards correlated with it or not.[8]


He also explained that Section 8 of the Indian Contracts Act, 1872 says that performance of a condition of the offer is an agreement of offer and in the present case the situation was that the person who will find the missing nephew will be remunerated and hence as per this provision he has satisfied the condition, hence plaintiff is entitled to claim the award.



It was contested by the respondents that there must be an agreement to the proposal to turn it into a contract and agreement is the basic essential to establish a contract. At the time he was tracking the boy he was uninformed about this award connected with the child, so without knowing how can it constitute a contract within parties.[9]


It was also claimed by them that at the time of tracing the missing nephew he was serving as a servant and thus satisfying the responsibilities and duties for which he was sent to Haridwar from Cawnpore.


The Allahabad High Court accurately decided on the case, that the acceptance of the proposal as was required to be fulfilled by the plaintiff was not a complete one because the plaintiff did not know about the hand-bills. For the acceptance of a proposal, knowledge of the proposal is necessary. The handbills were issued after the plaintiff went for discovering the defendant’s nephew near Haridwar. The performance of the plaintiff to seek for the defendant’s nephew was not because of the award granted in the hand-bill but was because it was his responsibility to search for him. He then had a subsisting employee commitment to be satisfied.

The proposal and agreement cannot also be declared to be valid because the plaintiff did not do any new act for securing the prize. The act that the plaintiff worked as a part of the profession and not a bit of the agreement for remuneration. There was no consideration on account of the plaintiff for which he can allege the defendant’s remuneration. There was no clear advantage for the defendant. No doubt the case indicated by the plaintiff sustained their dispute but their judgments have been scrutinized. [10]


According to Section 10 of the Indian Contract Act, 1872, it is made up that the primary portion of a legitimate contract is the lawful aim to enter one and fulfill its duties. Implementing this in the current case, the necessary purpose to start an agreement was missing concerning the exasperated party. Lalman Shukla to strike out his legitimate responsibilities as he was appointed the task by the litigant to find the escaped nephew. Plus, there was no substantial acknowledgment since the litigant did not know about this offer. And implementing the method of rationalizing held in Ramchandra Chintaman V. Kalu Raju, he was at that time following responsibility to find the kid and couldn’t secure the award, on its achievement. Additionally, on interpreting the decision revealed in Carlill V. Carbolic Smoke Ball concerning the current case. The lack of preceding knowledge of the proposal and a legitimate receiving of it also dismissed their appeal on the award.

Therefore, by looking out these limitations concerning the appealing party to give a real acceptance. The Honorable High Court performed a vital role in rethinking the characteristics of obligations. A lawful duty and legally binding in the contractual world. And as I would perceive it, has legitimately identified the two.

Hence, it is perceived that knowledge and acceptance are the principles of the formation of a valid contract. This means that if a person allows the given proposal only then, the award can be challenged in return. Additionally, information is vital in achieving the award which lacked in the current case. Most importantly, it shows that agreement must be made at a reasonable rate and must be delivered to the offeror. Thus, in one way or another, it indicates that intention to enter in a valid contract is a need to implement the legal responsibilities.

Thus, if responsibilities/agreements made before the contract are in dispute (or are varying) with one another, precession goes to obligations/duties mutually agreed by both parties at the time of agreement. Thus, it is essential to guarantee that prior agreements made mutually by both parties are not invalidated by the current contract, unless and until it is approved by both the stakeholders in interest.[11]


The case heaved light on the primary term and explanation of the General offer. This was presented to people in general on the large not to any individual particularly. As per this case, acknowledgment of an offer, need not be communicated to one proposing that. Mere fulfilling its demanded conditions are enough to make one eligible. He can enjoy the award or compensation as guaranteed fulfillment.

Thus, the proposal, in this case, is the general case,

While acknowledging the importance of both parties that intend to enter a contract and knowing the proposal before conveying their agreement. It was challenging for the Judge to dispute the setup judgment in English Law. This decision declared the Indian perception and way of analysis of contractual law. Other than coinciding with other importance, which enhanced the term Acceptance.


[2] Lalman Shukla vs. Gauri Dutt [1913] 40 ALJ 489










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