Indian Contract Act, 1872

1. OFFER
BUSINESS LAW
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES,
NMCC, MARTHANDAM

2. OFFER / PROPOSAL
• According to Sec.2(a),
• when one person signifies his willingness
to another
• to do or to abstain from doing anything
• with a view to obtaining the assent of the
other person to such act or abstinence,
• he is said to make a proposal.
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM

3. HOW IS AN OFFER MADE ?
1. By words (Express offer)
• written or oral
• Written – through letters, emails, etc.
• Oral – over telephone or in person.
• Example : Mr. Somu proposes by letter to sell his
house to Mr. Ramu for Rs. 50,00,000.
2. By conduct (Implied offer)
• Through positive acts or signs
• Example : Passengers boarding a public transport bus
with the intention to become a passenger by paying
the ticket fare.
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM

4. ESSENTIAL REQUIREMENTS OF A VALID OFFER
1. Must be communicated to the other party.
2. Must be made with a view to obtain the consent of the offeree.
3. Terms of the offer must be definite and certain.
4. Must be capable of creating a legal relationship.
5. Must be express or implied from the circumstances.
6. May be conditional.
7. Mere statement of intention is not an offer.
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM

5. TENDER
• Tender is an offer.
• It is a response to the invitation to offer.
• 2 types :
• A) A Definite offer to supply goods or services
• Example : A invites tenders for the supply of 1,00,000 bricks.
X, Y and Z submit the tenders. A accepts X’s tender. Now,
there is a binding contract between A and X.
• B) A Standing offer
• Example : A invites tenders for the supply of bricks
each month for 12 months in 2021. Number of bricks
may vary based on the order from time to time.
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM

6. REVOCATION OF OFFER
• An offer may be revoked or withdrawn any
time before the offer gets accepted.
• Revocation may happen by :
• By giving notice of revocation
• By lapse of time
S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM

7. S.M. GOLDYN ABRIC SAM, ASST. PROFESSOR, DEPT. OF MANAGEMENT STUDIES, NMCC,
MARTHANDAM