Introduction

An agreement that can be legally enforced is a contract. In a contract, each of the parties is
legally bound between themselves. The term agreement is defined in Section 2 (e) of the Indian
Contracting Act, 1872, as “all promises and sets of promises which form consideration for each
other become an agreement”. Under section 2(h) of the Indian Contract Act, 1872 (ICA), the
term contract has been defined as an agreement enforceable by law. An agreement includes a
promise from both parties. When an agreement becomes legally enforceable, it is a valid
contract. An important essential part of a valid contract includes an offer and subsequent
acceptance. An offer is a statement of intent by the promisor. An offer can be positive or
negative, i.e., to do or not do something. Consent towards this offer should be expressed and
communicated through an act or omission in which the promisee (or the party receiving the
offer) intends to express consent, which is known as acceptance. Once a proposal is received and
properly communicated to the other party, it becomes a legally binding contract, as long as the
consideration and object are legitimate and the parties intend to create legal relationships.

Tender

An offer of performance (also called a Tender) is made by the Promisor if he is willing to execute
the Contract and offers it to the Promisor as an obligation, and if the Promisor Rejects the Offer,
then the Promisor is not liable for Non-Procurement of the Contract and does not lose his Rights
under the Contract. The Act of Not Providing Adequate Opportunities/Facilities for the
Performance of the Contract by the Promisor to The Promisor Also Apologizes The Promisor
From The Performance Of The Contract and is upheld by Section 67 of the Indian Contract Law
1872. The Essential Features of a Valid Offer of Performance/Tender.

Section 38 Indian Contract Act 1872

Where a promisor has made an offer of performance to the promisee, and the offer has not been
accepted, then the promisor is not responsible for non – performance, nor does he thereby lose
his rights under the contract. Every such offer must fulfil certain conditions which are as follows,
namely:
 It must be unconditional;
 It must be done at the appropriate time and place and in such a way that the person
making it can reasonably be sure that the person receiving it is capable and willing to
fulfill all of his or her obligations there and then.;
 If you are offering to deliver something to the person you are promising to deliver it to,
then the person you are offering it to should have a reasonable chance of knowing that the
thing you are offering is the thing that the person you are going to deliver to.An offer to
one of several joint promises has the same legal consequences as an offer to all of them.
Liability in the case of failure to consider the tender

As mentioned above, in the case of a performance of tender offer, the Promisor is ready to
execute the Contract and offers the Contract to the Promisee as an Obligation and if the Promisee
Rejects the Offer, then the Promisor can not be held liable for Non-Procurement of the Contract
and the Promisor does not lose its Rights under the Contract. Similarly, if the Promisee did not
provide reasonable opportunities to Promisor for the Performance of the Tender or Contract, then
it discharges the Promisee from the Performance of the Contract. Section 38 of the Indian
Contract Acct 1872 provides that if an Offer of Performance is made by the Promisor to the
Promisee and the Promisee either Rejects the Tender or the Promisee does not accept the Tender
and then the Promisor does not lose its rights under the Contract. Under the Indian Contract Act,
1872, a contract may be discharged by refusal to accept performance under certain
circumstances. Here are some case laws that illustrate situations where refusal to accept the
performance of a contract has been considered:

Demby Hamilton and co. vs Burden(1949),

There was a contract of supply of 30 tons of apple juice. The juice was tendered but refused to
take delivery of some of the instalments. At the time of tender, the juice was fresh but
subsequently, it became putrid. It was held that the buyer was at fault in not taking the delivery
of goods when tendered, therefore, he was liable for the loss caused by the juice becoming
putrid. If there is an offer of delivery of anything to the promisee, then the promisee must be a
given reasonable opportunity for checking the thing offered as is it the same thing which the
promisor promised to deliver. If there are a number of joint promisees, an offer of performance
may be in favour of one of them.

Conclusion

It is clear from the above discussion that an agreement that can be enforced by law is a contract.
In a contract, both parties are legally bound between themselves. The term contract is defined in
ICA, Section 2(h). Tender also means an offer of performance. The fundamental elements of a
valid Tender are listed in Section 38 of ICA, Tender. There are 4 fundamental elements in a valid
Tender. A valid Tender must be unconditional. The tender must be created at the appropriate
time and place. The Tender must give the promisee the opportunity to ascertain/prove that the
goods comply with the contract. The valid Tender is an offer of performance made by the
Promisor to any of the Joint Promisors. In a Tender, if the Promisor offers the same and the offer
is accepted by the promisee, then the Promisor can not be held liable if the offer is rejected and
the promisee does not lose its rights under the Contract.