Types of Offers

Meaning An offer is the starting point in the making of an agreement. An offer is also called `proposal’. According to Section 2(a) of The Indian Contract Act, 1872, “A person is said to have made the proposal when he 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.”
Essential Elements An offer involves the following essential elements:
(a)       It must be made by one person to another person. In other words, there can be no proposal by a person to himself.
Example: X says to Y that he wants to sell his car to himself for Rs. 1 lakh. There is no proposal because there can be no proposal by a person to himself.
(b)       It must bean expression of readiness or willingness to do (i.e. a positive act) or to abstain from doing something (i.e. a negative act).
Example I: X offers to sell his car to Y for Rs 1 lakh. It is a positive act on the part of X.
Example II: X offers not to file a suit against Y if Y pays X an outstanding amount of Rs. 1,00,000. It is a negative act on the part of X.
  •    TYPES OF OFFER
1.         Specific Offer
            A specific offer is one which is made to a definite person or particular group of persons. A specific offer can be accepted only by that definite person or that particular group of persons to whom it has been made.
            Example X offers to buy car from Y for Rs 1.0 lakh. This offer is a specific offer which has been made to a definite person Y No person other than Y can accept this offer

2.       General Offer 
This offer is one which is not made to a definite person, but to the world at large or public in general. A general offer can be accepted by any person by fulfilling the terms of the offer. In case of general offer, the contract is made with person who having the knowledge of the offer comes forward and acts according to the conditions of the offer.
Example  X advertiser! In the newspaper that he would pay Rs 5,000 to anyone who traces his missing boy. Y who knew about the reward traced that boy and sent a telegram to X that he had found his soil, It was held that X was entitled to receive the amount of reward. [Harbhajan Lal v. Harcharan Lal (AIR All 539)]

3.         Cross Offers
            Meaning Two offers which are similar in all respects made by two parties to each other, in ignorance of each other’s offer are known as `cross offers’.
            Effect Cross offers do not amount to acceptance of one’s offer by the other. Hence, no contract is entered into on cross offers.
            Example X of Agra sends a letter by post to Y of Delhi offering to sell his car for    Rs 1 lakh. The letter is posted on 1st January and the same day. Y of Delhi sends a letter by post to X of Agra offering to buy X’s car for Rs 1 lakh. These two letters cross each other. Y’s letter is merely an offer and not the acceptance of X’s letter. Here, both the parties are making offer and no party has accepted the offer Therefore, no contract has been entered into. If they want to enter into a contract, at least one of them must send his acceptance to the offer made by the other.
4.        STANDING OFFER/OPEN OFFER/CONTINUING OFFER
            Meaning An offer of a continuous nature is known as ‘standing offer’.
            Nature A standing offer is in the nature of a tender.
            Contract A contract is said to have been entered into only when an order is placed on the basis of the tender.
            Example X Ltd. requires a large quantity of certain goods during the 12 months period and gives an advertisement inviting tender in the leading newspaper Z submitted the tender to supply those goods at a specific rate. Z’s tender is accepted or approved. Now, Z’s tender becomes a standing offer. Each order given bY X Ltd. will be an acceptance of the offer.

Comments

Post a Comment

Popular posts from this blog

Work certified and uncertified

Meaning of Work Certified  When contractor takes the contract to complete any construction work, it may complete in 4 or 5 years. but contractor has to pay different expenses for material, labor and others. So, it is very necessary to pay him some money of contract. This money is given on the basis of work done. So, any part of construction which is completed by contractor will be work certified if it is certified by an authority. Authority may be independent engineer or architect who can estimated the work. He will issue the certificate of work done after certifying the work of construction. On this work certified, contractor has right to get money of contract. Meaning of Work Uncertified Work uncertified means work done but not certified by authority. So, contractee will cut some money on the basis of work uncertified and will keep in his pocket. This will be retention money. Accounting Treatment of Work Certified and Work Uncertified  (I) Work  certified...
Read more

factors influencing choice of advertising agency

The Advertiser looks for an advertising agency whose services and expertise meets his requirements. Following factors should be considered while selecting an advertising agency:- Services offered by Ad-agency  - There are different agencies provides different services, some provides all the services, some provide selected services, some provides only media services. It depends on the requirement of advertiser whether he need a fulls service agency, creative boutique, media buying service agency, or a  sweet shop . Experience of Agency  - An experienced agency performs better then a new agency  because it is familiar with different components of marketing environment like- competitors' policies, taste of consumer, income of consumer, consumer responses, fashions and trends, reputation of different media etc. Location  - A major factor to be considered while selecting ad-agency is location of office of agency. A considerable amou...
Read more

Environment of International Marketing

Image
Apple is so successful because of their effective marketing efforts. They are good in identifying relevant environmental factors and trends which helps in taking advantage of opportunities and minimising threats.  New technological developments, global economic conditions, worldwide population changes, increased competition, legislative requirements, and political events are some of the factors affecting current and future marketing activities of the organisations around the world. Combination of such factors makes the International Marketing Environment. The long term performance of any organisation depends on its ability to identify and respond effectively to the key changes in its marketing environment.  Meaning of International Marketing Environment  International Marketing Environment is the combination of various factors external to an organisation that can affect the international marketing decisions of the organisation in international market. These fac...
Read more