Site navigation

A seller offers to sell a desk for ₹8,000. The buyer responds with a firm offer of ₹7,000. The seller…

A proposal is communicated when it comes to the knowledge of the person to whom it is made under section 4 of the Indian Contract Act, 1872. A response proposing a different…

Choose your answer

A seller offers to sell a desk for ₹8,000. The buyer responds with a firm offer of ₹7,000. The seller accepts the buyer’s proposal without qualification. Which sequence describes the formation of the contract?

Select one answer
Answer and explanation

Correct answer B

A proposal is communicated when it comes to the knowledge of the person to whom it is made under section 4 of the Indian Contract Act, 1872.

A response proposing a different price is a counteroffer in this scenario. Under section 7, acceptance must be absolute and unqualified. The buyer’s counteroffer rejects the original offer.

The seller’s unqualified acceptance forms a contract on the new terms.

Option feedback

Option A

The buyer’s proposed price differs from the seller’s offer. This response makes a counteroffer.

Option B

The buyer’s firm counteroffer displaces the seller’s offer. The seller’s unconditional assent accepts the new offer.

Option C

The buyer’s firm counteroffer rejects the first offer, so the first offer does not stay open.

Option D

The counteroffer rejects the first offer when it is communicated. Accepting the counteroffer is a later event.

Practice for these exams

Related exam syllabi

Related questions in this topic