The Government has notified an order under an appropriate Statue in the month of September, 2022 that no one shall buy or sell a particular explosive chemical except under license obtained by the specified authority. Tar

The definition of Fraud has been provided under section 17 of the Indian Contract Act, 1872. 'Fraud' is an untrue statement made knowingly with the intent to deceive. The party defrauded can avoid the contract and also claim damages. The chief ingredients of fraud are: a false representation or assertion, of fact (and not mere opinion), made with the intention that it should be acted upon, the representation must have actually induced the other party to enter into the contract and so deceived him, the party deceived must thereby be indemnified, for there is no fraud without damages, and the statement must have been made either with the knowledge that it was false or without belief in its truth or recklessly without caring whether it was true or false. It is immaterial whether the representation takes effect by false statement or with concealment. Therefore, Tarun can recover advance payment paid from Brju because it is voidable contract on account of 'fraud' committed by Brju. Thus, Tarun can rescind/cancel/ avoid the contract and can sue to recover the advance paid to Brju. Also Tarun has right to claim compensation for any damage which he has sustained through non-fulfilment of the contract. Alternate answer to above paragraph A voidable contract is initially considered legal and enforceable but can be rejected by one party if the contract is discovered to have defects. If a party with the power to reject the contract chooses not to reject the contract despite the defect, the contract remains valid and enforceable. Now, in the given situation Brju defrauded Tarun to enter into contract. But later on Tarun found that contract was entered into by fraud. Tarun could have avoided the contract at that time and can recover advance paid. But Brju conviced Tarun that he shall obtain the license within reasonable time, this means Tarun does not rejected the contract and agreed to continue an illegal agreement, as buying & selling of explosive chemical without licence has been prohibited by Government. In view of the above, Tarun cannot recover advance paid if Brju failed to obtain the license as illegal agreement is not enforceable at law.