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4.UNIT - 1C Invitation To Treat

An invitation to treat is not an offer but rather stimulates people to make offers. It is made by one party to inform the public of the terms under which they are interested in potentially entering a contract. Examples include menus, timetables, tenders, and advertisements. An invitation to treat only becomes an offer if responded to, at which point acceptance forms a binding contract between the parties. The key difference between an invitation to treat and an offer is that an invitation does not represent final willingness to contract but rather interest in receiving offers.

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440 views7 pages

4.UNIT - 1C Invitation To Treat

An invitation to treat is not an offer but rather stimulates people to make offers. It is made by one party to inform the public of the terms under which they are interested in potentially entering a contract. Examples include menus, timetables, tenders, and advertisements. An invitation to treat only becomes an offer if responded to, at which point acceptance forms a binding contract between the parties. The key difference between an invitation to treat and an offer is that an invitation does not represent final willingness to contract but rather interest in receiving offers.

Uploaded by

Anish Kartik
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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UNIT -1 Formation Of Contract

c. Invitation to Treat
• An Invitation to Offer is an act before an offer, in which
one person induces another person to make an offer to
him, it is known as invitation to offer.
• When appropriately responded by the other party, an
invitation to offer results in an offer.
• It is made to the general public with intent to receive
offers and negotiate the terms on which the contract is
created.
• The invitation to offer is made to inform the public, the
terms and conditions on which a person is interested in
entering into a contract with the other party.
• Although the former party is not an offeror as he is not
making an offer instead, he is stimulating people to offer
him.
• Therefore, the acceptance does not amount to a contract,
but an offer.
• When the former party accepts, the offer made by the
other parties, it becomes a contract, which is binding on
the parties.
• Example:
• Menu card of a restaurant showing the prices of food
items.
• Railway timetable on which the train timings and fares
are shown.
• Government Tender
• A Company invites application from public to subscribe
for its shares.
• Recruitment advertisement inviting application.
• Key Differences Between Offer and Invitation to Offer
(Treat)
• The principal points of difference between offer and
invitation to offer are as follows:
• An offer is the final willingness of the party to create legal
relations. An invitation to offer is not the final willingness
but the interest of the party to invite public to offer him.
• An offer is defined in section 2 (a) of the Indian Contract
Act, 1872. Conversely, an invitation to offer is not defined
in the Indian Contract Act, 1872.
• An offer is an essential element to make an agreement
between the parties, but an invitation to offer is not an
important element until it becomes an offer.
• An offer becomes an agreement when accepted. On the
other hand, an invitation to offer becomes an offer when
the public responds to it.
• The main objective of making an offer is to enter into the
contract, whereas the main objective of an invitation to
offer is to negotiate the terms on which the contract can
be made.
BASIS FOR COMPARISON OFFER INVITATION TO OFFER
MEANING When one person When a person expresses
expresses his will to something to another
another person to do or person, to invite him to
not to do something, to make an offer, it is known as
take his approval, is known invitation to offer.
as an offer.
DEFINED IN Section 2 (a) of the Indian Not Defined
Contract Act, 1872.

OBJECTIVE To enter into contract. To receive offers from


people and negotiate the
terms on which the contract
will be created.
ESSENTIAL TO MAKE A Yes No
CONTRACT

CONSEQUENCE The Offer becomes an An Invitation to offer,


agreement when accepted. becomes an offer when
responded by the party to
whom it is made.

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