Consideration is the basis of valid contract. When a party to an agreement promises to do something, he must get something in return. This something is called consideration. A promise without consideration is purely gratuitous and cannot create legal obligation. An analysis of contract will show that it consists of two clearly separable parts:
(1) the promise and
(2) the consideration for the promise.
A person who makes a promise to do or obtain from doing something usually does so a return or equivalent of some loss, damages, or inconvenience that may have been occasioned to the other party in respect of the promise. The benefit so received or the loss or damage or trouble so caused is regarded in law as the consideration for the promise. Thus consideration is the price by the promise for the promise of the promiosr.