Methods of discharging a contract by mutual agreement.

Since a contract is created by means of an agreement, it may also be discharged by another agreement between the same parties. Sections 62 and 63 provide for the following methods of discharging a contract by mutual agreement:

1. Novation: “Novation occurs when a new contract is substituted for an existing contract, either between the same parties or between different parties, the consideration mutually being the discharge of the old contract.” When the parties to a contract agree for “novation,” the original contract is discharged and need not be performed. The following points are also worth nothing in connection with novation:
i. Novation cannot be compulsory; it can only be with the mutual consent of all the parties.
ii. The new contract must be valid and enforceable. If it suffers from any legal flaw on account of which it becomes unenforceable, then the original contract revives.

2. Alteration: Alteration of a contract means change in one or more of the material terms of a contract. If a material alteration in a written contract is done by mutual consent, the original contract is discharged by alteration and the new contract in its altered form takes its place. A material alteration made in a written contract by one party without the consent of the other, will, make the whole contract void and no person can maintain an action upon it.

3. Rescission: A contract may be discharged, before the date of performance, by agreement between the parties to the effect that it shall no longer bind them. Such an agreement amounts to “rescission” or cancellation of the contract, the consideration for mutual promises being the abandonment by the respective
parties of their rights under the contract. An agreement of rescission releases the parties from their obligations arising out of the contract. There may also be an implied rescission of a contract e.g., where there is non-performance of a contract by both the parties for a long period, without complaint, it amounts
to an implied rescission.

4. Remission: Remission may be defined “As the acceptance of a lesser sum than what was contracted for or a lesser fulfilment of the promise made.” Section 63 lays down that a promisee may give up wholly or in part, the performance of the promise made to him and a promise to do so is binding even though there is no
consideration for it. An agreement to extend the time for the performance of a promise also does not require consideration to support it on the ground that it is a partial remission of performance.

5. Waiver: Waiver means the deliberate abandonment or giving up of a right which a party is entitled to under a contract, whereupon the other party to the contract is released from his obligation.

Objectives of statutory meeting as per companies Act  Under what circumstances membership of a company can be cancelled?

Objectives of statutory meeting as per companies Act.

Under what circumstances membership of a company can be cancelled?

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