Fahad Ahmad

17U00092

Business Law

Assignment

A asks B, “Do you want to buy this car of mine?” B then says, “I will pay you Rs. 300,000 for
the car” Is this an offer or inviting an offer? When can A accept or reject. Discuss and explain
your answer.

An offer and invitation to offer are two different terms, which must not be confused with one
another. An offer is a proposal while an invitation to offer is inviting someone to make a
proposal. In an offer, there is an intention to enter into a contract, of the party, making it and thus
it is certain. On the other hand, an invitation to offer is an act which leads to the offer, which is
made with an aim of inducing or negotiating the terms. So, in an invitation to offer, the offeror,
does not make an offer, rather invites other parties to make an offer. Hence, before simply
responding to an offer, one must know the difference between offer and invitation to offer,
because that makes a difference in the rights of parties. So in this case this is an invitation to
offer by A while B has made the offer. A can accept or reject if he agrees or not agrees to enter
into a contract proposed by B.