Indian Contract Act, 1872 · Chapter IV: Of the Performance of Contracts · Contracts which must be performed
Section 38: Effect of refusal to accept offer of performance
In plain words
If a promisor offers to perform and the promisee refuses, the promisor is not responsible for non-performance and keeps their rights under the contract.
- The offer must be unconditional, made at a proper time and place, and in a way that gives the promisee a reasonable chance to see the promisor is able and willing to perform fully.
- If it is an offer to deliver something, the promisee must have a reasonable chance to check it is the right thing.
- An offer to one of several joint promisees counts as an offer to all of them.
A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.
Official text
Where a promisor has made an offer of performance to the promisee, and the offer has not been accepted, the promisor is not responsible for non-performance, nor does he thereby lose his rights under the contract.
Every such offer must fulfil the following conditions:—
(1) it must be unconditional;
(2) it must be made at a proper time and place, and under such circumstances that the person to whom it is made may have a reasonable opportunity of ascertaining that the person by whom it is made is able and willing there and then to do the whole of what he is bound by his promise to do;
(3) if the offer is an offer to deliver anything to the promisee, the promisee must have a reasonable opportunity of seeing that the thing offered is the thing which the promisor is bound by his promise to deliver.
An offer to one of several joint promisees has the same legal consequences as an offer to all of them.
Illustration
A contracts to deliver to B at his warehouse, on the 1st March, 1873, 100 bales of cotton of a particular quality. In order to make an offer of a performance with the effect stated in this section, A must bring the cotton to B's warehouse, on the appointed day, under such circumstances that B may have a reasonable opportunity of satisfying himself that the thing offered is cotton of the quality contracted for, and that there are 100 bales.
Source: India Code (indiacode.gov.in), the consolidated text published by the Legislative Department, Government of India. Text as updated on India Code on 15 October 2026. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.
Supreme Court judgments citing the section 38
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K.S. Manjunath and Others v. Moorasavirappa @ Muttanna Chennappa
Whether the High Court committed any error in passing the impugned judgment whereby it allowed the appeals filed by the vendees and set aside the decree passed by the Trial Court, while granting the relief of specific…