Consideration is one of the most important elements of a valid contract. In simple words, it means “something in return”. Every agreement must have some value exchanged between the parties, otherwise it cannot become a contract.
According to law, consideration is when one party does something, promises to do something, or even promises not to do something, at the desire of the other party. This can be in the form of money, service, act, or even a promise.
For example, if A agrees to sell a book to B for ₹500, then the book is consideration for B, and ₹500 is consideration for A. Both parties are giving something in return.
One important point to remember is that consideration can be past, present, or future:
👉 Past – something already done
👉 Present – done immediately
👉 Future – promised to be done later
Also, consideration must be lawful. If it is illegal or against public policy, the agreement becomes invalid.
So, whenever you study a contract, just check:
✔ Is there something given in return?
If yes, then consideration exists.