REVOCATION OF OFFER AND ACCEPTANCE
REVOCATION OF OFFER
It is only after the acceptance of an offer that there arises a contract and then both the parties become bound bytheir respective promises.
According to sec. 5: "A proposal may be revoked at any time, before the communication of its acceptance is complete as against the proposer, but not afterwards." Thus, an offer can be revoked before it has been accepted. After an offer has been accepted it ripens into a contract and then it cannot be revoked.
WITHDRAWAL OF RESIGNATIONUNION OF INDIA V. GOPAL CHANDRA,
A.l.R. 1978 S.C. 694.
A "prospective" resignation is an offer to quit a post and the same can be withdrawn before the offer is accepted by a competent authority.
MANAGING COMMITTEE, S.G.A. HIGH SCHOOL V. STATE OF BIHAR AND OTHERS,A.l.R. 1981 Pat. 271.
The Supreme Court decision in Union of India v. Copal Chandra, A.l.R. 1978 S.C. 694 was followed in this case.
Dr. Parmanand, the Secretary of the Managing Committee of a school, sent his letter of resignation on 9.7.1980 requesting the Managing Committee to accept the same. He sent another letter dated 9.8.1980 withdrawing his resignation.
The Managing Committee, which met on 11.8.80 considered the letter of resignation of Dr. Parmanand butignored his subsequent withdrawal of resignation, and decided to accept the resignation.
The question before the court was whether the resignor could withdraw the resignation submitted by him.
It was held that it was clear from the letter of resignation that the resignor intended his resignation to be prospective in the sense that he wanted it to be accepted by the Managing Committee, and therefore, he was free to withdraw the same before it became effective by acceptance. It was observed that in view of the withdrawal of the resignation, the resolution of the Managing Committee accepting the resignation in its meeting held on 11.8.80, was invalid.
WITHDRAWAL OF BIDS
In case of sale by auction the bids made at the auction are offers, and the highest offer may be accepted bythe auctioneer. In such a case the sale is complete when the auctioneer announces its completion by the fall of the hammer or in other customary manner; and until such announcement is made, any bidder may retract his bid.
RAJENDRA KUMAR VERMA V. STATE OF MADHYA PRADESH A.I.R 1972 M.P. 131:
Submission of a tender to supply or purchase goods at a stated price is making an offer.The person submitting the tender may withdraw his tender before the same has been approved. Any restriction preventing the revocation of offer before its acceptance, is invalid.
The Delhi High Court has also given a similar decision in Suraj Besan and Rice Mills v. F.C.I. [A.l.R. 1988 Delhi 224.] and observed that the Government by providing a clause in the tender notice could not take away the right of a person to revoke an offer.
AN OFFER CAN NOT BE REVOKED AFTER ITS ACCEPTANCE
J.K. ENTERPRISES V. STATE OF M.P., [A.I.R. 1997 M.P. 68.]
A tender for purchase of Tendu leaves was submitted by the petitioner on 11-1-93. The respondents sent letter of acceptance of tender by registered post at the address given by the petitioner, on 12-2-93. The letter, however, did not reach the petitioner and, he purported to withdraw his offer by a fax message on 3-3-93. It was held that a valid contract had come into existence on 12-2-93 and, therefore, there could be no revocation of offer by a fax message sent thereafter.
REVOCATION IN CONTRACTS BY POST
According to sec. 5, a proposal may be revoked at any time before the communication of its acceptance is complete as against the proposer, but not afterwards. In contracts by post, it has to be seen, as to at what time the communication of acceptance is complete against the offeror, because no revocation is possible after such communication has been completed.
According to sec. 4: "The communication of an acceptance is complete as against the proposer, when it is put in the course of transmission to him, so as to be out of the power of the acceptor."For instance, A proposes, by a letter sent by post, to sell his house to B. B accepts the proposal by a letter sent by post. A may revoke his proposal at any time before or at the moment when B posts his letter of acceptance, but not afterwards.
