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Key Differences

Know the Differences & Comparisons

Difference Between Offer and Invitation to Offer (Treat)

offer vs invitation to offerAn 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 (treat) 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.

Content: Offer Vs Invitation to Offer (Treat)

  1. Comparison Chart
  2. Definition
  3. Key Differences
  4. Conclusion

Comparison Chart

Basis for ComparisonOfferInvitation to Offer
MeaningWhen one person expresses his will to another person to do or not to do something, to take his approval, is known as an offer.When a person expresses something to another person, to invite him to make an offer, it is known as invitation to offer.
Defined inSection 2 (a) of the Indian Contract Act, 1872.Not Defined
ObjectiveTo enter into contract.To receive offers from people and negotiate the terms on which the contract will be created.
Essential to make an agreementYesNo
ConsequenceThe Offer becomes an agreement when accepted.An Invitation to offer, becomes an offer when responded by the party to whom it is made.

Definition of Offer

An offer is an expression of a person showing his willingness to another person to do or not to do something, to obtain his consent on such expression. The acceptance of the offer by such person may result in a valid contract. An offer must be definite, certain and complete in all respects. It must be communicated to the party to whom it is made. The offer is legally binding on the parties. There are following types of offer:

  • General offer: The type of offer which is made to the public at large.
  • Specific offer: The type of offer made to a particular person.
  • Cross offer: When the parties to the contract accept each other’s offer in ignorance of the original offer, it is known as the cross offer.
  • Counter offer: This is an another type of offer in which the offeree does not accept the original offer, but after modifying the terms and conditions accept it, it is termed as a counter offer.
  • Standing offer: An offer which is made to public as a whole as well as it remains open for a specific period for acceptance it is known as Standing offer.

Example:

  • A tells to B,”I want to sell my motorcycle to you at Rs. 30,000, Will you purchase it?”
  • X says to Y,”I want to purchase your car for Rs. 2,00,000, Will you sell it to me?”

Definition of Invitation to offer (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:

  1. 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.
  2. 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.
  3. 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.
  4. An offer becomes an agreement when accepted. On the other hand, an invitation to offer becomes an offer when the public responds to it.
  5. 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.

Conclusion

Now, you are surely not confused between these two. It is also a characteristic of an offer that it must be distinct from an invitation to offer. An Invitation to offer is a very familiar term as we all have dined in a restaurant where menu cards show the price list of the concerned food items or booked a ticket by viewing the railway timetable. Two most famous examples are pamphlets of pizza’s showing their rates and an auction sale advertisement.

The Offer is quite specific term as it is meant to create legal relations as it is an essential element for making a contract. The ‘intention’ of the party making it, is the fundamental phenomenon that differentiates the two terms.

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Comments

  1. SSEMBATYA says

    April 17, 2016 at 9:50 pm

    I have really liked this post..thanks a lot…N way i would like to request for a more detailed exhalations of more differences between an offer and invitation to treat…I will be happy to receive your reply

    Reply
    • Surbhi S says

      April 18, 2016 at 4:13 am

      Thanks for sharing your view, we will surely consider your topic.

      Reply
    • Nancy Mrunde says

      October 17, 2021 at 9:11 pm

      I liked the article . ..its helpful

      Reply
    • Katusiime says

      February 21, 2022 at 6:56 pm

      Me too I liked the post thnx alot for that

      Reply
  2. Hannah Tarindwa says

    June 4, 2016 at 9:31 pm

    Thanks… It finally really makes sense!!!

    Reply
  3. Sachin Harsana says

    December 27, 2016 at 10:53 pm

    These things many times in his mind but not sure what is said. Today when I started learning in these terms eg. Void or voidable nd offer and offer to sale etc…I think why not search on the Website ..I found many articles in this regard but ur article is very much clear nd significant quantity of this topic…Thank u ?

    Reply
  4. Gabby says

    December 19, 2017 at 12:44 pm

    Wow!!! My problem is solve..I have been looking for an answer to this question. And finally your answer is one of the best…am very greatful..

    Reply
  5. Pankaj says

    March 3, 2018 at 7:55 pm

    Awesome website …….keydifferences.com helped me a lot in my studies….

    Thank you team keydifferences.com

    Reply
  6. tif says

    July 12, 2018 at 7:36 am

    1 more thing, for it to be constituted as an offer, it must be certain, when there is open for negotiation on particular goods then it is an invitiation to treat because there is an uncertainty on what type of goods that the seller actually referring to

    Reply
  7. Deepshikha says

    July 30, 2018 at 11:31 am

    Very helpful article. Presents a very clear picture. Thanks

    Reply
  8. Navneet says

    December 4, 2018 at 7:01 pm

    I am very confused between offer and invitation of offer but after read your topic it becomes clear in one time….. Awesome website…

    Reply
  9. syaza says

    January 5, 2019 at 8:20 pm

    Thank you so much for this sharing! I was so confused on how to distinguish between these two, yet now i finally know the differences. Thanks!

    Reply
  10. Bridget Nguevese Tyokohol says

    March 3, 2019 at 7:09 am

    Wow I really Thank God for having you here,I search and searched over and over I wasn’t getting a reasonable answer to this,but finally you now solved my problems ,I will always visit you on question like this, thank you once again I really appreciate.

    Reply
  11. Bridget Nguevese Tyokohol says

    March 3, 2019 at 7:26 am

    Thank you so much for putting me through, i really appreciate.

    Reply
  12. Jyoti says

    September 15, 2019 at 7:09 am

    Thanks a lot for making it so easy to understand

    Reply
    • Agatha says

      March 19, 2021 at 3:55 am

      Thanks

      Reply
  13. KUDZAI MUTAMBIRWA says

    October 26, 2019 at 4:54 pm

    YOUR EXPLANATION IS VERY CLEAR…………. THANKS FOR MAKING MY LIFE EASIER

    Reply
  14. Madaviya Shaikh says

    November 17, 2019 at 10:48 am

    Hi,
    Proposal and Invitation to proposal
    Offer and invitation to offer

    Are the above topics same?

    Thank you

    Reply
    • Surbhi S says

      November 18, 2019 at 9:39 am

      Yes

      Reply
  15. PHILEMONMUSHI says

    January 14, 2020 at 9:43 pm

    nice explanations ever

    Reply
  16. Amit says

    June 8, 2020 at 1:33 pm

    i could not find better answer than this …..great

    Reply
  17. Wilson says

    October 1, 2021 at 1:48 pm

    I now know the meaning of invitation to treat thanks to these notes. They are the best answers

    Reply
  18. Deusdedith says

    December 14, 2021 at 2:29 pm

    So simplified notes, well done for your lecture.

    Reply
  19. Dikshita sisodiya says

    December 9, 2022 at 3:26 pm

    Language and explanation is best

    Reply
  20. Mona says

    February 14, 2023 at 7:35 am

    Really it is very simplest note regarding this topic .I couldn’t find any simplest answer than thease means very simple language and explanation is waoo…….. Really very nice 👍👍👍…… Thanku so much

    Reply

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