A tender is a formal offer or proposition to perform or refrain from performing an act, and it obligates the person making the tender to the other party. A tender might be made for money or for particular items. The tender comes into the same category as a price quotation if it is not an offer. The tender becomes a standing offer after it is accepted. Only after an offer is made based on the tender can a contract be formed. One of the contract’s conditions required the signatories to comply with a requirement that they must supply the other party with coal of a specific quality for a period of 12 months starting on the day the contract was signed. Following the contract’s terms for a while, the defendants refused to follow the conditions that were outlined in the agreement before the duration of the contract expired. The defendant was then sued by the plaintiff for breach of contract.
The court ruled that there was no contract between the parties and that the terms stipulated therein were simply a part of a standing offer. The court further ruled that the plaintiff’s successive orders constituted a series of contracts because they represented an acceptance of the defendant’s offers to supply the quantity requested by the plaintiff. The offers that were really made by the defendants in this case cannot be revoked. But putting those offers aside, the defendants had full authority to revoke the offers. The purchase orders in Rajasthan State Electricity Board v. Dayal WoodWork was issued in terms of a supply arrangement. Yet, the condition that the tenderer could decline to furnish the items was already included in the purchase offer. In this instance, the court determined that there was no concluded contract that entered into force, and as a result, the contractor was free to receive his security deposit back.
The tender becomes irrevocable in situations where the tenderer has agreed, in exchange for some sort of consideration, not to withdraw it or when there is a legal provision prohibiting it. The acceptor of the tender also has the right to decline to make any orders, just as the tenderer has the right to withdraw his offer. The military authorities in Madho Ram v. The Secretary of State for India accepted a tender for the supply of specific commodities, but no requisition was ever issued during the tender period. In a case where the military authorities were the defendants, the court ruled that the military authority was not in any way bound by the military authority’s acceptance of their offer to buy some or all of the products included in the contract without any covenant about that matter. Therefore, the party accepting the offer has the right to inform the tenderer at any point that they no longer want to make an order for the purchase of goods.
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