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According to the Indian Contract Act, 1872, A proposes, by letter, to sell a house to B at a certain…

Under Section 4 of the Indian Contract Act, 1872, a proposal is communicated when it comes to the offeree’s knowledge. Illustration (a) treats B’s receipt of the letter as…

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According to the Indian Contract Act, 1872, A proposes, by letter, to sell a house to B at a certain price. The communication of the proposal is complete when _____.

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Answer and explanation

Correct answer B

Under Section 4 of the Indian Contract Act, 1872, a proposal is communicated when it comes to the offeree’s knowledge. Illustration (a) treats B’s receipt of the letter as the point of communication. A’s posting of the proposal occurs earlier. The rule for postal acceptance as against the proposer is separate. B need not acknowledge receipt to A.

Option feedback

Option A

Incorrect: "A posts the letter": Posting a letter of acceptance completes communication of acceptance as against the proposer under Section 4, but posting a letter of proposal does not complete communication of the proposal.

Option B

In the illustration to Section 4, communication of the proposal is complete when B receives the letter.

Option C

Incorrect: "B communicates receiving the letter" and "A receives the information of receipt of the offer letter": Section 4 requires only that the proposal come to B's knowledge (receipt by B), not acknowledgment back to A.

Option D

Incorrect: "B communicates receiving the letter" and "A receives the information of receipt of the offer letter": Section 4 requires only that the proposal come to B's knowledge (receipt by B), not acknowledgment back to A.

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