The Indian Contract Act 1872 governs the laws and regulations related to contracts in India. One of the most important aspects of a contract is the mode of revocation of an offer. In this article, we will explain the various modes of revocation of an offer as per the Indian Contract Act 1872.
Revocation of Offer
Before we delve into the modes of revocation of an offer, let us first understand what an offer is. An offer is a proposal made by one party to another with the intention of entering into a contract. It is important to note that an offer must be made with an intention to create legal relations.
Modes of Revocation of an Offer
1. Revocation by the Offeror Before Acceptance
The offeror has the right to revoke the offer at any time before the acceptance of the offer. The revocation can be made either orally or in writing. The offeror has to communicate the revocation to the offeree. It is important to note that the revocation is effective only when it is actually communicated to the offeree.
2. Revocation by the Offeree Before Acceptance
The offeree also has the right to revoke the offer before its acceptance. The revocation by the offeree can be either express or implied. An express revocation is one where the offeree informs the offeror about the revocation. An implied revocation is one where the offeree does a certain act which is inconsistent with the acceptance of the offer.
3. Revocation of Offer by Operation of Law
There are certain circumstances where an offer is revoked by operation of law. Some of these circumstances include:
a) Death or insanity of either party before acceptance of the offer.
b) Destruction of the subject matter of the contract.
c) Revocation by the passing of time.
d) Disappearance of the offeror or the offeree.
It is important to note that in all these circumstances, the offer is revoked automatically without any communication between the parties.
Revocation of an offer is an important aspect of a contract. The Indian Contract Act 1872 lays down the various modes of revocation of an offer. It is important for parties entering into a contract to be aware of these modes to ensure that their contract is legally binding.