B.com (Business law) notes

Business law (B.com)

(A).   Law of Contract 1872


1. Definition of Contract

Contract is agreement between two or more parties which can be apply with law. It is done by competent parties.

As per section 2(h), " An agreement enforceable at law is a contract."

Any agreement which creates  the responsibility of the parties of agreement, will be the contract. In the contract, one party offers and other party gives his acceptance.

2. Acceptance | Indian Contract Act 1872

When a person gives his offer to do or not to do anything It is his proposal to other person. If other person accepts his proposal, it will be the acceptance of other person.  As per section 2 (b) of Indian contract act, " We say promise to accepted offer." For example, when a company issues his shares to shareholder, it is the acceptance of shareholder's offer.

Without acceptance, an agreement can not become a valid contract.

Essentials of a Valid Acceptance 

1. Acceptance must be Absolute and Unconditional : 

In psychology, we also say it as surrender. So, acceptance must be absolute and unconditional. If a person (who wants to accept the offer) want to accept on basis of his conditions, then this will not valid acceptance because it will create counter offer. Acceptance should be of all conditions of offer.

2. Acceptance must be Communicated to the Offeror

If a person who gives the acceptance will be silent, then no contract will exist. So, acceptance should be given through written, oral or other media of communication to the offeror.

3. Acceptance must be Made within a Reasonable Time 

Acceptance must be made to offeror before the closing day of offer. If offeror revocate his offer before acceptance, then no contact will exist.

4. Acceptance may be express or implied 

Like offer, acceptance may be express or implied. When a person gives his acceptance through his tongue or through writing, it will be the acceptance through expression.  If a person who gives his acceptance through his conduct or behaviour, it will be his implied acceptance. For example, when you go to a shop and take one packet of biscuit and eat it, it means, you have accepted to pay its price by your conduct.

5. Acceptance must be communicated in proper manner 

If offeror did not decide the way of communication of acceptance, then it should be given through proper manner.

6. An offer can be accepted by the person to whom it is made 

A person to whom offer is not made can not give acceptance. Acceptance must be give by a person to whom offer is made.

7.  The Acceptor must be aware of the proposal at the time of acceptance 

If any acceptor may behave with the offeror like he accepts his offeror without the awareness of the proposal, then it will not make a valid contract.

3. How to Revoke Offer

As per the section 6 of Indian Contract Act 1872, you can revoke your offer with following ways.

1. Revocation of Offer by giving Information

Offerer can revoke the offer by giving its information to the party who has accepted it. Information must reach at the party who accept it. If your information could not reach to the party who accept the offer, it is not revocation. For example, you make the video and upload in the youtube. youtube suspend your youtube channel and give its notification to your email. So, youtube is the party who offer you to upload your video and you accept but it has break your contract by suspending your account. It is revocation example.

2. Revocation of Offer by Not Completing it on the Time

If offer is not completed by giving acceptance, then it will be revocation of offer. For example, seller is giving offer of $ 10000 product at 20% discount for 10 days. but you did not accept it. So, you are revoking the offer which was special for you.

3. Revocation of Offer by Not Completing its Conditions

Revocation can be done by not completing its condition. For example, if offer of sale is on the condition of giving 50% advance to seller but buyer did not give advance, it means, buyer did not accept this condition. So, this is revocation of offer.

4. Revocation of Offer Due to Death  or mad of Offer Giver 

If the party who gives the offer suffering from madness or he or she dead, then offer will be revoked automatically.

5. Revocation of Offer by Re-Offer

If offerer re-offers with new conditions, then original offer will be revoked automatically. For example, seller is ready to get 25% advance from buyer instead of getting 50% in previous offer, then previous offer will be revoked automatically due to this.

6. Revocation of Offer by Not Offering with Proper method of Offer

If offer is not given with proper way, it will be revoked. For example, buyer wants written contract for buying same product from vendor but vendor is not signing the contract, it means, oral offer of seller is useless.

https://drive.google.com/file/d/1G-Uzf25ASqK839QyXPq2iFvofIfnlWsS/view?usp=sharing

Part (B)

On the next page:-

Business law (B.com)

(A).   Law of Contract 1872

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