Question

Karan and Arjun had entered into a contract where Karan was to supply 50,000 phones to Arjun within 2 months from the date of signing of contract. Karan was to procure the phones from China and deliver the same to Arjun. The rate of the phone was Rs. 5000/- a piece (inclusive of all taxes and duties). At the time of the execution of the contract, the duty was at 5% (five percent). Immediately after the execution of the Agreement, India had increased the duties to 1000% (one thousand percent). Therefore, Karan was finding it difficult to sell the phones at the price agreed earlier. In the circumstances, kindly advice:
a. How can Karan discharge such a contract? (5 Marks)
b. How can Arjun enforce such a contract?

Answer 1

Answer:

The said questions are from Business Law and in the current context, by applying sound principles of the subject, both Karan and Arjun can get a favorable deal for themselves.

Since the context in which the questions are being asked has changed considerably since the signing of contract, hence both parties can claim to execute it as per their preference.

But by applying Business Law correctly, a middle path can be arrived so that it stays a win-win deal for both parties

Thanks.