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    Question

    Under Section 2(a) of the Indian Contract Act, 1872,

    which of the following best describes the essence of a proposal in contract law? 
    A A unilateral statement of intent by one party that creates immediate legal obligations Correct Answer Incorrect Answer
    B When one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining assent of the other Correct Answer Incorrect Answer
    C A binding agreement between two or more parties to exchange consideration Correct Answer Incorrect Answer
    D An invitation to offer made by a party seeking contractual engagement Correct Answer Incorrect Answer
    E A communication that automatically converts into a contract upon receipt Correct Answer Incorrect Answer

    Solution

    Section 2(a) defines a proposal as: "When one person signifies to another his willingness to do or abstain from doing anything with a view to obtaining assent of the other, he is said to make a proposal." This definition is fundamental and establishes that a proposal is not itself a contract but merely an invitation seeking acceptance. It must involve a manifestation of willingness to be bound and must be communicated with the intention of obtaining the other party's assent. In Carlill v. Carbolic Smoke Ball Co., the court held that a proposal becomes a promise only when it is accepted. Therefore, until acceptance is communicated, no binding contract exists.

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