The security and stability of a business world are depend upon the law of contract indeed the basis of trade and commerce today is the enforce ability of promises In business transactions, where promises are very often made at one time and the performance is to follow later there should be a legally enforceable obligation to perform the agreements. Legally enforceable promises are termed contracts.

DEFINITION

Literally:
The world contract comes from a Latin word “Contractus” Contractus means consent, agreement or to enter into an agreement with a particular subject.

Formal agreement between two people and groups states etc.

Traditionally:
“The agreement which is enforceable by saw is a contract”
Ex, Sumon says to Mamun, “Will you buy my house for Tk.50000?” This is an offer. If Mamun says “Yes”, the offer is accepted and a contract is formed.

Case,Where A purchase property from B and the sale is fictitious A can not recover B money paid by him to save the property from being sold in execution of a decrease against B. Janki Prasid Singh v. Baldeo Prasad,(1908) All.167.

Salmond
A contract is “an agreement creating and defining obligation between the parties”

Sir William Anson
“A contract is an agreement enforceable at law made between two or more persons by which rights are acquired by one or more to acts or forbearances on the part of the other or others”

A contract is an agreement or convenient made between two or more persons by which one or some of the parties acquire legal rights to have the other parties do or to forbear to do certain acts. A contract is an agreement and without consent there is no agreement of the parties.

1.    Professor Carbin defines a contract as “The legal relation between persons arising from voluntary expression of intention and including at least one right in perform actual or potential with it's ’corresponding duty”. Article an “Offer and acceptance and some of the resulting legal relations” (26 Yale Law January, 169).

A contract is an agreement between two or more persons for the violation of which a court of law will give damages. There are many agreements for the breaking of which no damages can be held, either because the agreement can templates no legal relations or because it ends in a relation that is not enforceable in a court of law.
 
Example: Tapash and Polash mutually agree that they will meet each other at a certain place and go to a football game together. Polash failed to keep his promise. This is not a contract, because the agreement contemplates social not legal relation.

Sumon in a spirit of fun offers in writing to purchase for Tk500000 Arif’s old and dilapidated automobile, which is not more than Tk10000, and Arif jokingly accepts the offer. Should Arif attempts to collect the money by filing suit the court would hold there is no intention to create a legal obligation on the part of either of the parties. Hence no damages would be awarded.     

An agreement enforceable by law is a contract.[Section-2 (8)]

The word agreement has been defined as “every promise every set of promises forming the consideration for each other”[Section-2 (5)]

The world promise has been defined as “a proposal when it is accepted”
[Section-2 (2)]

And “when one person signifies to another his willingness to do or to abstain from doing anything with a view to obtaining the assent of that other to such act or abstinence he is said to make a proposal”[Section-2 (1)]

Thus for the formation of a contract it is necessary that one party makes a proposal and accepts it.