Sec.2(a) defines the term ‘proposal‘ as follows:
“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. “

An offer can be made by any act which has the effect of communicating it to the other. An offer may either be an ‘express offer’ or an ‘implied offer’. An offer can be made by any act which has the effect of communicating it to the
other. An offer may either be an ‘express offer’ or an ‘implied offer’.

Implied Offer: It is an offer which is not made by words spoken or written. An implied offer is one which is inferred from the conduct of a person or the circumstances of the particular case. For example, public transport like DTC in Delhi or BEST in Bombay runs buses on different routes to carry passengers who are prepared to pay the specified fare.

CLASSIFICATION OF OFFER:

1) SPECIFIC OFFER: Sometimes an offer is made to a particular person, part or org. , such offer is known as a specific offer. This specific offer can be accepted only by that particular person or org.
2) GENERAL OFFER: It is an offer which is made to a group of people or public at large. Such offer can be accepted by any member of that group or public.
3) CROSS OFFER: Two parties exchange identical offers with each other. They are ignorant about each other’s offers.
4) COUNTER OFFER: Incomplete and conditional acceptance of an offer is known as a counter offer. In other words, the acceptor, instead of accepting the offer as such along with all its terms and conditions deviates from it. Such acceptance becomes a counter offer.

ESSENTIALS OF VALID OFFER:

1) Offer must create a legal relationship and consequence: The whole concept of contract is based on legal relationships or obligations of legal consequences .Thus the formation of contract with starts with an offer, its acceptance followed by the legal relationships and its consequences means the party making an offer must have clear intention to establish the legal relationship with other party.
2) Offer may be express or implied: The offer may be made either by the word of mouth or in writing. Such an offer is known as an express offer. On the other hand if the offer is inferred, or indirectly understood either from the conduct of parties or from the circumstances, such offer is known as implied offer.
3) Offer may be specific or general: The offer being made to a particular individuals or orgs. Is known as specific offer. On the other, if an offer has been made to a group of people or public at large is known as general offer.
4) Offer must be communicated: An offer is made with a view to create, legal relationships so it must be communicated to the person to whom it is made. Without communications the offer is incomplete and cannot be accepted.

5) Offer must be distinguished from a mere expression of intention or invitation: Sometimes one party merely shows his intention for making an offer or invites other party for making it. Such intention or invitation for making an offer will not be considered as a valid offer.
6) Offer maybe conditional: While making an offer the offeror may impose conditions for the acceptor, such conditional offer is valid subject to the following conditions:
a) Offeror cannot impose any such condition the non‐fulfillment of which would lead to acceptance of that offer.
b) The terms and conditions imposed by the offeror must be mentioned in the offer in such a way that a person of a reasonable prudence may find indication for those conditions and those conditions must be reasonable eyesight.

REVOCATION OF OFFER:

Revocation of offer means withdrawal, cancellation or lapse of offer. According to Sec 6 of this act, Offer can be revoked under the following circumstances:
a) By notice, b) By lapse of time, c) Death or insanity of offeror D) Non‐fulfillment of prerequisite conditions, e) by counter offer, f) by compliance of prescribed mode or manner.

What Constitutes a Revocation of Offer?

The main criteria for a binding revocation is that it’s communicated to the offeree before they accept the offer.

Communication of revocation can be direct or indirect and can be made by a third party. If the communication is indirect, it must meet several requirements. It needs to be:

• Correct
• Communicated by a reliable source
• Able to be understood by a “ reasonable person”

Selling an item to someone else is considered a legal revocation so long as the original offeree is notified of the sale before they accept the offer.

Offers made through a publication are something of a special case. These offers can be revoked by a notice in that publication without specifically contacting the offeree.

When Are Offers Considered Irrevocable?

Offers are considered irrevocable under the following conditions:

• If it is stated that the offer shall be kept open as part of consideration.
• If the offeree relied on the offer being open to their detriment (detrimental reliance).
• If the contract is unilateral, has been partially completed or is underway and the offeree is still in compliance with the terms.
• Signed offers with firm terms that guarantee a party will buy or sell goods that include an assurance that the offer must be held open, even if no consideration is present.
• If a stated period is provided, the offer is irrevocable for the lesser of that period or three months time.

1)In Balfour vs. Balfour (1919)

Mr. Balflour was a civil engineer and worked for the government as the Director of Irrigation in Ceylon(now Sri Lanka).In 1915 both of them came back to England when Mr. Balflour was on leave but due to an illness(arthritis) of Mrs. Balfour, she was unable to come back to Ceylon with her husband. The husband promised to pay 30 euros per month to his wife until she rejoined him in Ceylon. The husband failed to pay her the said amount hence the wife sued him for the amount. The court held that the husband was not liable as there was no intention to create a legal relationship.

ACCEPTANCE

According to Sec 2(b) of Indian contract act 1872, defines the term acceptance “as a proposal or offer is said to have been accepted when the person to whom the proposal is made signifies his assent to the proposal”.

ESSENTIALS OF VALID ACCEPTANCE:

1.) Acceptance must be absolute and unconditional: Offer may be made for a specific quantity, volume and price. It may also contain terms and conditions. It is necessary for the acceptor that he must give his acceptance for the entire quantity and volume offered.
2.) Acceptance must be given in a prescribed mode or manner: While making an offer the offeror may prescribe a particular mode or manner of acceptance and the acceptor must abide by it. If the acceptor does not follow that particular mode for sending his acceptance, the offeror that further insist the acceptor to abide by it. But if it is still not followed the offeror can reject the acceptance. On the other if no mode is prescribed, by the offeror then the acceptor can follow the usual mode of acceptance.
3.) Time of acceptance: To make it valid acceptance, it must be given within stipulated period of time if any. When no time is specified, acceptance must be given within reasonable period of time.
4.) Acceptance must be communicated: As the offer needs to be communicated, so does the acceptance. Acceptance to be legally effective must be communicated and brought to the knowledge of the offeror. Even if the acceptor has accepted the offer but if it is not communicated properly it would not result into an agreement.

5.) Acceptance may be expressed or implied: The acceptor may give his assent for the proposed act by the word of mouth or in writing. Such acceptance is known as express acceptance. If the acceptance is directly understood either from conduct of the party or from circumstance, it is known as implied acceptance.
6.) Acceptance must be made before offer is revoked: Acceptance implies mental readiness of the person for proposed act or abstinence. Therefore, it must be given before the offer lapses or is withdrawn or cancelled. Once the offer is dead due to any reason if it is dead for ever, and to revive it, such offer is to be made afresh.
7.) Acceptance is not implied from silence if the party: Acceptance of offer is not implied from silence. The offeror cannot impose condition on offered that his silence will amount to acceptance. Silence on the part of offered regarding the offer in no case may amount to acceptance.

REVOCATION OF ACCEPTANCE:

The Revocation of Acceptance is complete ONLY at any time before the communication of acceptance is complete as against the acceptor, but not afterwards. Revocation of Acceptance too can be either oral or written. Acceptance has to be revoked mandatory before the same reaches the Offerer.

1) Failure of acceptor
2) Death or insanity of acceptor
3) No reasonable time and manner
4) By rejection
5) By supervising impossibility.

Conclusion:

Offer and acceptance analysis is a traditional approach in contract law used to determine whether an agreement exists between two parties. An offer is an indication by one person to another of their willingness to contract on certain terms without further negotiations. If the “contract” is too vague, uncertain or incomplete it will not be enforceable and we cannot be considered as Contract.