Section 56 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 56 deals with three situations: an agreement to do something impossible from the start, a contract that becomes impossible or unlawful after it is made, and a promisor who knew or should have known the act was impossible or unlawful. Readers often search it as "frustration of contract"; the section itself uses the words "impossible" and "unlawful", not "frustration". If an event has disrupted your contract and you need to decide where you stand, our legal dispute resolution team can review the position.
An agreement to do an act impossible in itself is void. A contract to do an act that afterwards becomes impossible, or becomes unlawful by reason of some event which the promisor could not prevent, becomes void when the act becomes impossible or unlawful. A promisor who knew, or with reasonable diligence might have known, that the act was impossible or unlawful, when the promisee did not know, must make compensation for the promisee's loss. A footnote refers to section 65 for what follows when a contract becomes void.
Paragraph 1: agreement to do an impossible act
"An agreement to do an act impossible in itself is void."
The test is "impossible in itself", which looks at the act itself and not at one party's difficulty. The Act's illustration (a): A agrees with B to discover treasure by magic. The agreement is void.
Paragraph 2: contract to do an act afterwards becoming impossible or unlawful
"A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful."
Four things to read carefully:
- Timing. The contract was valid when made. The change comes "after the contract is made".
- Two triggers. The act becomes impossible, or it becomes unlawful "by reason of some event which the promisor could not prevent". The words "which the promisor could not prevent" attach to the unlawful limb as the text is printed.
- Effect. The contract "becomes void when the act becomes impossible or unlawful". The word "when" fixes the moment: the contract is void from then.
- What follows. A footnote cross-refers to section 65, which deals with restoring advantages received under a contract that becomes void; see sections 63 to 65.
The section does not define "impossible", and it does not say that higher cost, delay or hardship alone makes an act impossible. It also does not list events. The Act's illustrations show what it has in mind.
The Act's illustrations to the second paragraph
| Illustration | Facts | Result |
|---|---|---|
| (b) | A and B contract to marry each other. Before the time fixed, A goes mad. | The contract becomes void. |
| (d) | A contracts to take in cargo for B at a foreign port. A's Government afterwards declares war against the country in which the port is situated. | The contract becomes void when war is declared. |
| (e) | A contracts to act at a theatre for six months for a sum paid in advance by B. On several occasions A is too ill to act. | The contract to act on those occasions becomes void. |
Illustration (e) is instructive: the contract becomes void on those occasions, not for the whole six months. The Act's illustration does not alter the rest of the contract.
Paragraph 3: compensation where impossibility or unlawfulness was known
"Where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know, to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the non-performance of the promise."
Three conditions must come together:
- The promisor knew, or with reasonable diligence might have known, that the thing was impossible or unlawful.
- The promisee did not know.
- The promisee sustains loss through the non-performance.
The Act's illustration (c): A contracts to marry B, being already married to C, and being forbidden by the law to which he is subject to practise polygamy. A must make compensation to B for the loss caused to her by non-performance of his promise. The compensation here comes from the promisor's knowledge, not from the later event.
Summary table
| Paragraph | Situation | Effect |
|---|---|---|
| 1 | Act impossible in itself at the time of agreement | Agreement void |
| 2 | Act becomes impossible, or becomes unlawful by an event the promisor could not prevent, after the contract is made | Contract void when that happens |
| 3 | Promisor knew or could with reasonable diligence have known; promisee did not know | Promisor must compensate the promisee's loss |
A modern example (ours)
Lakshya Events books a hall for a three-day conference for Rs. 3 lakh with a part advance. Before the event, the hall is destroyed by fire, a cause beyond either party's control, and the hall owner cannot supply it. If the act of giving the hall has become impossible, the contract becomes void when that happens under paragraph 2. Compare: if the hall owner already knew, when signing, that the building was under a demolition order but did not tell Lakshya, paragraph 3 asks whether he knew or could with reasonable diligence have known of the impossibility or unlawfulness while the promisee did not, and if so the owner must compensate Lakshya's loss. Return of the advance is a matter for section 65, which our overview of that section covers.
What can the parties change?
Section 56 has no "unless a contrary intention appears" words. In practice, many contracts include their own force majeure clause listing events and consequences such as suspension, extension or termination. The text of section 56 does not say whether such a clause displaces the section or works alongside it, and that has been developed in case law outside this article. A clause that names events and consequences clearly reduces the need to rely on the section.
Practical points
- Add a force majeure clause naming events (war, fire, order of a public authority, epidemic) and the consequences: time extension, suspension, termination, refund of advances.
- Do not assume cost increases amount to impossibility. The section's words are "impossible" and "unlawful".
- Disclose known obstacles before signing; paragraph 3 turns on what the promisor knew or might have known.
- Record the date the event occurred, since the contract becomes void "when" the act becomes impossible or unlawful.
- Claim back advances in writing; see section 65 in our article on sections 63 to 65. If the problem is only lateness, not impossibility, read section 55.
Need help when an event disrupts your contract?
When a contract cannot go ahead because of an event outside anyone's control, the next steps matter: what is void, what must be returned, and what can be claimed. Our legal dispute resolution team can read your contract and the facts and explain the options. Bring the contract, the notices exchanged and the dates.
Key takeaways
- An agreement to do an act impossible in itself is void.
- A contract to do an act that afterwards becomes impossible, or unlawful by an event the promisor could not prevent, becomes void when that happens.
- A promisor who knew or might with reasonable diligence have known of the impossibility or unlawfulness, where the promisee did not, must compensate the promisee's loss.
- The Act's five illustrations: treasure by magic, a bride or groom going mad, bigamy, a declaration of war and an actor's illness.
- The section does not use the word "frustration" and does not define "impossible".
Read next
- Section 55: time as essence of contract and effect of late performance
- Sections 57 and 58: reciprocal promises partly illegal and alternative promises
- Sections 63 to 65: remission of performance, rescission and restitution
- Void and voidable contracts: overview of Sections 24 to 30
Disclaimer: Based on the text of the Indian Contract Act, 1872 as consulted on 1 October 2026. Many questions under this Act turn on case law and on the wording of the particular contract, which this article does not cover. It is general information, not legal advice; check the official text and take advice before acting.