ABSTRACT
Contracts by government raise some problems which do not or cannot possibly arise in the case of contracts entered into by private persons. In order that public funds may not be depleted by clandestine contracts made by any and every public servant, there is often a specific procedure according to which governments’ contracts must be made. Section 65 of the Indian Contract Act enshrines the principle of restitution. It provides that any person who has received any advantage under a void contract is bound to restore it, or to make compensation for it, to the person from whom he received it. A contract being “opposed to public policy” is a defence under Section 23 of the Indian Contract Act. The doctrine of public policy is contained in a branch of common law. It is governed by precedents.
