What is the law in India about past consideration?

 Consideration is an essential element of contract and has been defined under Section 2(d) of the Indian Contract Act 1872. 

It provides that when, at the desire of the promisor, the promisee or any other person has done or abstained, from doing or does or abstains from doing, or promises ‘to do or to abstain from, doing, something, such act or abstinence or promise is called a consideration for the promise.

Depending on factor of time, consideration can be of three types, “past consideration”, present consideration or “executed consideration”, and future consideration or “executory consideration.” The definition in Section 2(d) contemplates all the three kind of considerations and accordingly in India, even the past consideration is valid and good consideration and a contract on the basis thereof, shall be valid contract.

The past consideration is recognised in section 25 of the Contract Act as past voluntary services. However, in English law a past consideration is not a good consideration and accordingly a contract on that basis is not valid.

If one party makes a promise in exchange for an act by the other party, when that act is completed, it is executed consideration. It is basically present consideration. Illustration- “A offers Rs. 50 reward for the return of her lost handbag, if B finds the bag and returns it, B’s consideration is executed.”

Whereas consideration is executory when there is an exchange of promises to perform acts in the future. For example- A promises to deliver an article to B at some future date and B promises to pay A for the article when he receives the shipment. If A does not deliver the widgets to B, B can sue A for breach of contract.