Revocations of offer mean cancellation or withdraw of an offer by the offerer. Offerer has right to revoke it at any time. The revocation of an offer depends on the willingness of offerer himself. Thus if the offer once made is recalled by the offerer before it is accepted by offeree. In the case of revocation and lapse of an offer normally gets terminated and consequently it is no longer open to acceptance.

5 Carlill v. Carbolic smoke Ball Co.

The Nepal Contract Act, 2056 has mentioned several conditions relating to the revocation and lapse of an offer. Any of the following conditions an offer may revoke or lapse.

  • By revocation notice (Section 8.1)

The offerer has right to revoke his offer at any time by giving notice of revocation to the offeree. But such notice must be given to the offeree before his acceptance comes to the knowledge of offerer.

  • By the expiry of prescribed (Stipulated) time (Section 9.a)

An offer lapses if acceptance is not communicated within the prescribed time in the offer, or if no time is prescribed, within a reasonable time. (Section 9.a of Nepal Contract Act, 2056)

For example, Ram offer to sell his orange of 100 tons to Shyam in month of Magh but Shyam accepts it in the month of Baishak that is not a reasonable time because the seasons of orange has been over.

  • By the expiry of reasonable time (Section 9.b)

The time limit is not specifying in offer to get the acceptance from the offeree, the offer shall be revoked after the expiry of the reasonable time limit as required by the nature of that work.

  • By death or Insanity of offerer or offeree before acceptance (Section 9.c)

The fact of death or insanity of the offerer would not put an end to the offer until it comes to the notice of the acceptor before acceptance. An offeree's death or insanity before accepting the offer puts an end to the offer.

  • By Counter Offer (Section 9.f)

The offer is revoked if the acceptance is made by altering or adding the new conditions. It is because when become so the acceptor himself comes to be an offerer.

  • By non fulfillment of conditions (Section 9.g)

If there is a condition in the offer and such condition must be fulfilled firstly but the acceptor accepts it without fulfilling such condition, the offer is revoked.

For example, Ram made to sell his house and car to Shyam for a price of 15 lakhs. But Shyam agreed to purchase only house and not the car. The offer lapses because here condition was sale of house and car together.

  • By rejection of offeree:

An offer is regarded as revoked when the offeree rejects it. The rejection may be express that is by words spoken or written or implied. Implied rejection is one (a) where either the offeree makes a counter offer, or (b) where the offeree gives a conditional acceptance.

  • By subsequent illegality of subject matter:

An offer lapses if it becomes illegal after it is made, and before it is accepted. Thus, where an offer is made to sell 100 bags of rice for Rs. 10,000/- and before it is accepted, a law prohibiting the sale of rice by private individuals is enacted, the offer comes to an end.

  • By destruction of subject matter:If the subject matter of an offer is destroyed by any cause like fire, flood or natural calamity before the offer is accepted by the offeree it becomes lapse.