Revocation of Proposals and Acceptance for CLAT - Practice Questions & MCQ

Revocation of Proposals:

• Definition: In contract law, a proposal (also known as an offer) is a communication made by one party (the offeror) to another (the offeree) with the intention of creating a legally binding contract. Revocation of a proposal refers to the offeror withdrawing or canceling the offer.
• Offeror's Right to Revoke: An offeror typically has the right to revoke their proposal at any time before the offeree accepts it. This means that until the offeree communicates their acceptance to the offeror, the offeror can change their mind and withdraw the offer.
• Communication of Revocation: To be effective, the revocation must be properly communicated to the offeree. This means that the offeree must receive the notice of revocation before or at the same time as they receive the acceptance.

Example 1:

• Offer: A offers to sell his car to B for Rs. 5,00,000.
• Revocation: A sends a message to B before B has a chance to accept, saying, "I've decided not to sell the car."
• Result: The revocation is valid since it reached B before any acceptance.

Acceptance:

• Definition: Acceptance is the offeree's unqualified agreement to the terms and conditions outlined in the offer. It's a critical step in forming a legally binding contract.
• Mirror-Image Rule: Acceptance must precisely mirror the terms of the offer. Any deviation or addition to the offer constitutes a counter-offer and not an acceptance.
• Communication of Acceptance: Acceptance must not only be a mental agreement; it must be communicated to the offeror in some form, whether verbally, in writing, or through conduct, depending on the circumstances.

Example 2:

• Offer: A offers to rent his apartment to B for a year at a specified monthly rent.
• Acceptance: B responds by email, saying, "I accept your offer and agree to the monthly rent as stated."
• Result: B's email effectively communicates acceptance to A.

Indian Case Law:

• Shankar Bhai v. Union of India (1984): In this Indian case, the Supreme Court emphasized that mere silence or inaction by the offeree does not constitute acceptance. Acceptance must be communicated to the offeror to form a contract.
• Bhagwandas Goverdhandas Kedia v. Girdharilal Parshottamdas & Co. (1966): This case highlighted that an offer can be revoked if it has not been accepted within a reasonable time, with reasonableness determined based on the specific circumstances of the case.

Indian Constitution:

• Contract law, including an understanding of the principles of offer, acceptance, and revocation, is essential for individuals and businesses exercising their rights under Article 19(1)(g) of the Indian Constitution, which guarantees the right to practice any profession, carry on any occupation, trade, or business.