Acceptance

Acceptance is the unqualified assent by the offeree to all the terms of the offer (Section 2(b), Indian Contract Act 1872).

## Core concept

Acceptance converts a proposal into a binding contract. It must be given by the person to whom the offer is made (offeree) and must show unconditional agreement to the exact terms offered.

Key principles: - Acceptance must be unqualified — any variation becomes a counter-offer, not acceptance - Can be expressed (words/conduct) or implied (by conduct or silence in rare cases) - Must be communicated to the offeror — mere mental acceptance is insufficient - Acceptance becomes effective when it comes to the knowledge of the offeror (Section 4, ICA) - Can be withdrawn before it is communicated to the offeror; after communication, it cannot be revoked

## Formula / rule

Conditions for valid acceptance:

1. By correct person – must be the offeree (or authorized agent)
2. To correct person – must be communicated to the offeror
3. Unconditional – "I accept but..." = counter-offer, not acceptance
4. Within the mode prescribed – if offeror specifies acceptance method, follow it (Section 7, ICA)
5. Within reasonable time – not after unreasonable delay (Section 2(b) note)
6. Based on the same terms – acceptance must mirror the offer exactly
7. With knowledge of the offer – offeree must know the offer exists

Timing rule (Section 4, ICA): - Acceptance becomes effective when it comes to the knowledge of the offeror, not when the offeree sends it - Example: Posted acceptance letter = effective when received and read, not when posted

## Common exam applications

Offer–acceptance scenarios:

1. Conditional acceptance – "I accept if you reduce price by 10%" = counter-offer (not acceptance)
2. Late acceptance – if accepted after reasonable time has elapsed, offeror can reject it (business context determines "reasonable")
3. Silence as acceptance – generally NOT valid (Section 8, ICA), except in exceptional circumstances (prior dealing, trade custom)
4. Acceptance by conduct – person requested to do something and does it = implied acceptance
5. Cross-offers – if two identical offers cross in post, no contract forms (both remain offers)

Withdrawal of acceptance: - Can withdraw if done before or at same time as acceptance reaches offeror - Cannot withdraw after offeror knows of it

## Worked example

X offers to sell his car to Y for ₹5 lakhs by letter.

Y replies: "I accept your offer, but I will pay in two instalments instead of lump sum."

Analysis: This is NOT valid acceptance because Y has added a new term (payment mode). This is a counter-offer. If X accepts Y's modified terms, a contract forms on the new terms.

Now if Y had simply written: "I accept your offer for ₹5 lakhs" → valid acceptance when X reads it.

## Common mistakes

• Thinking silence = acceptance — No. Silence does not amount to acceptance unless prior course of dealing suggests otherwise (Section 8, ICA)
• Confusing "receipt" with "knowledge" — Acceptance is effective when offeror *knows* of it, not just receives mail
• Conditional acceptance as valid — Any qualification ("if," "provided," "but") makes it a counter-offer
• Acceptance after offer lapses — If offer withdrawn or reasonable time has passed, late acceptance is ineffective
• Acceptance by wrong mode — If offeror specifies mail acceptance, acceptance by phone may be invalid

Exam tip: Always check whether the offeree has added, deleted, or modified any term. Even minor changes = counter-offer, not acceptance.