Question

‘S’ wanted to purchase shares of a company and communicated his offer to buy shares on March 1, 2021. A letter of allotment of shares addressed to ‘S’, which is an acceptance of the offer to purchase shares, was posted by the company on March 10, 2021, but the letter never reached ‘S’ and was lost in transit. In the given situation, which of the following statements is true?

• A. Communication of acceptance is not complete as against ‘S’ and hence, there is no valid contract between ‘S’ and the company.
• B. Communication of acceptance is complete as against ‘S’ however not complete as against the company.
• C. Communication of acceptance is complete as against the company however not complete as against ‘S’.
• D. Communication of acceptance is complete against both ‘S’ as well as the company.
• A. Pune
• B. Delhi
• C. Delhi
• D. Mumbai
• A. As against ‘X’, on January 15, 2021 at 4:04 pm and as against ‘Y’, on January 15,2021 at 7:05 p.m
• B. As against ‘Y’, on January 15, 2021 at 4:04 pm and as against ‘X’, on January 15,2021 at 7:05 p.m
• C. January 15, 2021 at 4:04 p.m
• D. January 15, 2021 at 7:05 p.m
• A. Delhi
• B. Jammu
• C. Agra
• D. Neither Delhi, Jammu nor Agra as it is an electronic contract.
• A. Only I
• B. I and II
• C. III and IV
• D. Only II

Answer 1

The Correct Option is B

The correct Answer is (B):Communication of acceptance is complete as against ‘S’ however not complete as against the company.

Answer 2

This question applies Section 4 of the Indian Contract Act to a case where S offered to buy shares, the company posted its allotment letter, its acceptance, on March 10, but that letter was lost in transit and never reached S.

1. Option A: Under Section 4, communication of acceptance is complete as against the proposer, here S, since S made the original offer to buy, the moment the acceptance is posted and out of the company's control, which already happened on March 10. So a contract does exist as against S from that date, even though the letter never arrived, which is the counterintuitive but settled effect of the postal rule. Saying there is no valid contract at all is therefore incorrect.
2. Option B: Communication of acceptance is complete against S upon posting, so it is not correct to say it is incomplete against S. This option gets that half of the rule backwards.
3. Option C: Communication of acceptance becomes complete against the acceptor, the company, only when it comes to the knowledge of the proposer, S. Since the letter never reached S, that knowledge never arrived, so it is not complete against the company, this option states the opposite of the correct position for both parties.
4. Option D: The letter never reaching S means the company's side of the rule, complete only on the proposer's actual knowledge, was never satisfied, so the acceptance cannot be complete against both parties, only against S.

Because posting alone binds S under the postal rule, while the company only becomes bound once S actually learns of the acceptance, the acceptance is complete against S but not against the company.

So the correct answer is Option B: Communication of acceptance is complete as against S however not complete as against the company.

Answer 3

The correct Answer is (D):Mumbai

Answer 4

This question tests where a contract is concluded when the offer and its acceptance both happen instantly over a phone call, as opposed to where the goods are later delivered or where the parties happen to live.

1. Option A: Pune is only where the goods are to be supplied under the agreed terms, the place of performance of the contract. The place where a contract is legally concluded is a separate question from where it will later be performed, so this option answers the wrong question.
2. Option B: Delhi is B's location, the offeree who accepted the call. For instantaneous communication such as a phone call, the contract is treated as formed where the offeror actually hears the words of acceptance, not where the acceptor happens to be sitting.
3. Option C: This repeats Delhi again, and fails for the same reason as the option above, it points to the acceptor's location rather than the offeror's.
4. Option D: Because a phone call is treated as an instantaneous mode of communication, similar to being in each other's presence, no contract arises until A, the offeror, actually hears B's acceptance. Since A was in Mumbai when that happened, Mumbai is where the contract is concluded.

For instantaneous communication like a phone call, the contract is formed where the offeror hears the acceptance, and A was in Mumbai at that moment.

So the correct answer is Option D: Mumbai.

Answer 5

The correct Answer is (A):As against ‘X’, on January 15, 2021 at 4:04 pm and as against ‘Y’, on January 15,2021 at 7:05 p.m

Answer 6

This question uses the same Section 4 postal style logic from the earlier passage, but applies it to email, which is treated as a non-instantaneous mode of communication with a time gap between sending and reading.

1. Option A: Communication of acceptance is complete as against the proposer, X, once Y's acceptance is put into a course of transmission out of Y's control, which is the moment the email was sent at 4:04 pm. Against the acceptor, Y, it is complete only once it comes to X's actual knowledge, which happened when X read the email at 7:05 pm. Both halves of this option match the rule exactly.
2. Option B: This option swaps the two times between the wrong parties, tying 4:04 pm to Y and 7:05 pm to X, which reverses which party is bound at which stage under Section 4.
3. Option C: Treating the contract as concluded at a single, shared time of 4:04 pm for everyone ignores the very feature of Section 4 that makes this rule distinctive, the moment of completion is different depending on which party you are asking about.
4. Option D: Fixing everything at 7:05 pm for both parties makes the same mistake in the other direction, and in particular it ignores that X, the proposer, is already bound earlier, at the moment of sending, not only once the email is actually read.

Section 4 fixes two separate moments, sending for the proposer and actual knowledge for the acceptor, and this fact pattern maps exactly onto 4:04 pm for X and 7:05 pm for Y.

So the correct answer is Option A: As against X, on January 15, 2021 at 4:04 pm and as against Y, on January 15, 2021 at 7:05 pm.

Answer 7

The correct Answer is (C):Agra

Answer 8

This question has two communication attempts, a failed email and a successful phone call, and asks which one actually fixes where the contract was concluded.

1. Option A: Delhi is only where the technical failure occurred, the server that could not deliver X's email. Since that email never resulted in any accepted offer, the routing failure at Delhi has no bearing on where an actual contract was formed.
2. Option B: Jammu is where Y, the acceptor, is located. Because the actual acceptance happened over an instantaneous phone call, the deciding location is where the offeror hears the acceptance, not where the acceptor is sitting.
3. Option C: The failed email is a dead end, it never reached Y and never resulted in any acceptance, so it plays no role in forming a contract. The real offer and acceptance both happened over the phone call between X and Y, and since that is an instantaneous exchange, the contract is treated as formed where X, the offeror, was standing when Y accepted, which is Agra.
4. Option D: The contract was not left unformed just because the earlier email attempt failed or because part of the story involved electronic transmission. The phone call created a straightforward, instantaneous acceptance, and that call fixes a real, physical place of formation, Agra, so calling it placeless is incorrect.

The failed email never created any rights or obligations, and the actual, instantaneous acceptance by phone places the contract where X, the offeror, was located.

So the correct answer is Option C: Agra.

Answer 9

The correct Answer is (B):I and II

Answer 10

This question gives four statements about telephone communication and asks which ones are true, based on the idea that spoken words of acceptance are instantly out of the acceptor's control the moment they are said.

1. Statement I: Because a phone call is treated as instantaneous communication, similar to the parties standing face to face, the contract comes into existence right away, at the moment of acceptance, rather than after any delay. This statement is true.
2. Statement II: With instantaneous communication, there is no meaningful gap between the acceptor speaking the words and the proposer hearing them, so both sides are treated as bound at essentially the same moment, not at two separate points in time the way postal acceptance works. This statement is also true.
3. Statement III: This wrongly calls telephone communication non-instantaneous. A phone call is precisely the kind of direct, real time exchange the law treats as instantaneous, so a rule built on describing it as non-instantaneous does not apply here, making this statement false.
4. Statement IV: This has the same defect as Statement III, it labels telephone communication as non-instantaneous, when the entire reason the postal, staggered timing rule does not apply to phone calls is that they are instantaneous.

Only Statements I and II correctly describe telephone communication as instantaneous with immediate, simultaneous completion for both parties, while III and IV both mischaracterise it as non-instantaneous.

So the correct answer is Option B: I and II.