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17. Law of Contract is codified law. Though the Contract Act is not a complete Code but where the Act is applicable and covers a case, it is not necessary to look beyond the statute and apply principles of equity, justice and good conscious. (Refer, Lala Kapoor Chand Godha v. Mir Nawab Himayatali Khan ).

18. Sections 2(g) - 2(i) of the Contract Act define the terms "contract", "void contract" and "voidable contract". An agreement enforceable by law is contract. The contract is an agreement or set of promises giving rise to obligations which can be enforced or are recognized by law. Public notices issued by MCD invited offers. It was an invitation but restricted to unauthorized dairy owners. The petitioners, therefore, have made a misrepresentation of fact in their applications seeking allotment, which as per law of contract was an offer. The respondent/MCD on the basis of misrepresentation initially/provisionally had made allotment to the petitioners but subsequently rescinded/cancelled the allotment but before possession is given.

19. The terms "void" and "voidable" contract are separate and distinct. A void contract is invalid since inception. It is no contract and is still born. Void contracts have to be distinguished from voidable contracts or contracts which become void subsequently after they have been validly executed and entered into. Voidable contracts are not still born and are contracts in the eyes of law. Voidable contracts are enforceable in law at the instance or option of the innocent party or can be rescinded by the said party. They remain a contract till the right to rescind is exercised.

22. Once an innocent party exercises the option and rescinds the contract, the contract becomes void and thereafter right to restitution in terms of Section 64 of the Contract Act gets attracted. In Satgur Prasad v. Har Narain Das , it was observed that once a voidable contract has been avoided, any person who has received any advantage under such contract is bound to restore it to the person from whom he had received it, or make compensation therefore. Quoting from Kerr on Fraud and Mistake it was held that a party exorcising his option to rescind is entitled to be restored as far as possible to his former position.

25. It is in this context that the legislature has been careful to use the words "restore as far as may be" in Section 64 of the Contract Act. A person rescinding the contract is bound to return the benefit he has received under the contract and is entitled to set off damages suffered at the hands of the defaulting party. In Murlidhar Chatterjee v. International Film Co. Ltd. , it was held that a party that has rightfully rescinded a contract can recover damages from the party at default and is afforded facility of set off. His just claims have to be met but further exaction is not justified by the default in view of Section 64 of the Contract Act. Where a payment has been made under a contract which -for what so ever reason - becomes void, duty of restitution would seem to emerge.