S
Sahaj Vidhi
Chhattisgarh Pre 2019

A agrees to buy from B a certain horse. It turns out that the horse was dead at the time of bargain though neither party was aware of the fact.

Verified Answer
A. This agreement is void.
B. This agreement is valid for compensation.
C. Either (1) or (2)
D. None of these

Explanation:

Section 20 of the Indian Contract Act, 1872, states that where both the parties to an agreement are under a mistake as to a matter of fact essential to the agreement, the agreement is void. The existence of the horse is an essential fact, and both parties were mistaken about it being alive.