Section 30: Agreements by way of wager void

Leading cases

• Gherulal Parakh v. Mahadeodas Maiya (1959)A partnership formed to carry on wagering transactions is not unlawful under Section 23 of the Contract Act, because a wager, though void under Section 30, is not forbidden by law, opposed to public policy or immoral.

Questions on this section

4 questions in 11 of our papers cite Section 30. Try these from the free papers:

1. 1. Assertion (A): In Dr. K.R. Lakshmanan v. State of Tamil Nadu (1996), the Supreme Court held that horse-racing is a game of skill, so that betting on horse-races was not 'gaming' under the law considered. Reason (R): Section 30 of the Indian Contract Act, 1872 does not render unlawful a subscription or contribution towards any plate, prize or sum of money of the value of five hundred rupees or upwards to be awarded to the winner of a horse-race.

   A.Both A and R are true, and R is the correct explanation of AB.Both A and R are true, but R is not the correct explanation of AC.A is true, but R is falseD.A is false, but R is true
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2. 2. In Gherulal Parakh v. Mahadeodas Maiya (1959), the Supreme Court examined a partnership formed to carry on wagering transactions. Which of the following correctly states its holding?

   A.A wager is void and also forbidden by law, so a partnership collateral to it is unlawful under Section 23B.A wager is void, and Section 30 itself makes every agreement collateral to a wager equally void and illegalC.A wager is void but not forbidden by law, so an agreement collateral to it is not unlawful under Section 23D.A wager is valid unless shown to be opposed to public policy, which must be proved on the facts of each case
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3. 3. A and B each bet Rs. 20,000 on the result of a cricket match and deposit their stakes with C, who is to pay the total to the winner. A wins, but C refuses to pay him. Under Section 30 of the Indian Contract Act, 1872:

   A.A can sue C for Rs. 40,000, as C holds the money only as a stakeholderB.A can sue B for Rs. 20,000, since B has lost the wagerC.A can sue C, as Section 30 bars only suits between the parties to a wagerD.no suit lies to recover the money entrusted to C to abide the result
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