Section 4 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 4 fixes the moment at which communication is "complete". The answer is different for a proposal, an acceptance and a revocation, and for the two sides of each. For acceptance and revocation, the moment is not the same "as against" one party as "as against" the other.
A proposal is complete when it comes to the knowledge of the person to whom it is made. An acceptance is complete as against the proposer when it is put in a course of transmission to him, so as to be out of the power of the acceptor, and as against the acceptor when it comes to the knowledge of the proposer. A revocation follows the same two-step pattern. The Act's own illustrations use a letter and a telegram.
The three rules in one table
| Communication | Complete as against the person who makes it | Complete as against the other person |
|---|---|---|
| Proposal | (single rule) when it comes to the knowledge of the person to whom it is made | |
| Acceptance | As against the proposer: when put in a course of transmission to him, out of the power of the acceptor | As against the acceptor: when it comes to the knowledge of the proposer |
| Revocation | As against the person who makes it: when put into a course of transmission to the other, out of the power of the person who makes it | As against the person to whom it is made: when it comes to his knowledge |
If you run a business that forms deals by post, courier, email or messaging platform, our agreement drafting service can help you build a clear acceptance mechanism that fits these rules.
Proposal: when it comes to knowledge
The first paragraph reads: "The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made." What counts as communicating is the subject of section 3; this paragraph says when it is complete. So a proposal sent but not yet read or learnt of is not yet complete. The test is knowledge, not posting.
Acceptance: two moments
The section says the communication of an acceptance is complete in two ways, depending on whom you ask:
- As against the proposer, when it is "put in a course of transmission to him, so as to be out of the power of the acceptor". Once the acceptor has sent it on its way and can no longer pull it back, the proposer is bound.
- As against the acceptor, when it "comes to the knowledge of the proposer". The acceptor is not bound until the proposer actually learns of the acceptance.
The words "as against" show whose position is being tested. The proposer is held to the acceptance earlier than the acceptor is held to it.
Revocation: the same pattern
The third paragraph applies the same pair of moments to a revocation:
- As against the person who makes it, when it is put into a course of transmission to the person to whom it is made, so as to be out of the power of the person who makes it.
- As against the person to whom it is made, when it comes to his knowledge.
The Act's own illustrations
The Act gives three illustrations, restated here in plain words.
Illustration (a). A proposes by letter to sell a house to B at a certain price. The communication of the proposal is complete when B receives the letter.
Illustration (b). B accepts A's proposal by a letter sent by post. The communication of the acceptance is complete as against A when the letter is posted, and as against B when the letter is received by A.
Illustration (c). A revokes his proposal by telegram. The revocation is complete as against A when the telegram is despatched, and as against B when B receives it. B revokes his acceptance by telegram. B's revocation is complete as against B when the telegram is despatched, and as against A when it reaches him.
These are the Act's own illustrations. Notice that they use the post and the telegram. The section's words, "course of transmission" and "out of the power of", are not tied to those media; the text does not set separate rules for email or messaging, and we do not invent any.
Putting the rules together: the two-step timeline
Take the Act's house example. A sends a letter of proposal. Then:
- A posts the proposal. Not complete yet.
- B receives the letter. The proposal is now complete (4, first paragraph).
- B posts a letter of acceptance. Complete as against A at that moment, since it is out of B's power.
- A receives the letter. Complete as against B at that moment.
Between steps 3 and 4 the acceptance binds A but does not yet bind B. Section 5 then says how long each can revoke. See our article on sections 5 and 6.
A modern example (ours, not the Act's)
Nisha offers by courier letter to rent her warehouse to Omkar. The letter is delivered to Omkar's office on Monday morning and he reads it that afternoon. Under 4, the proposal is complete when it comes to Omkar's knowledge. On Tuesday Omkar hands a signed acceptance letter to a courier, so that he cannot call it back. As against Nisha, the acceptance is complete at that moment. If Nisha sends a revocation on Tuesday evening, after the acceptance is out of Omkar's power, the revocation comes too late under section 5, which we discuss in our article on sections 5 and 6. As against Omkar, the acceptance is not complete until Nisha learns of it, which may be Wednesday.
What can the parties change?
Section 4 does not state that the parties may vary it. A proposal can prescribe the manner of acceptance (section 7(2)), and the parties' contract can set its own notice mechanics for later communications such as termination notices. But the text of section 4 itself does not say the parties may fix a different moment of completeness. If you want certainty, specify how and where acceptance must be received.
Practical points
- Know your moment. A signed acceptance that is on its way and out of your control binds the proposer; do not assume it only counts when received.
- Use a single channel. State the address or platform for proposals and acceptances.
- Revoke early. If you want to withdraw a proposal, do it before the other side's acceptance is out of their power.
- Keep proof of sending and receipt. Courier slips, read receipts and email logs show when each step happened.
Need help with acceptance and notice mechanics?
If your business forms contracts by post, courier or electronic channels, our agreement drafting team can help set out how proposals, acceptances and withdrawals are to be sent and received, so that the timing is not left to argument.
Key takeaways
- A proposal is complete when it comes to the knowledge of the person to whom it is made.
- An acceptance is complete as against the proposer when it is out of the acceptor's power, and as against the acceptor when the proposer learns of it.
- A revocation follows the same two-step pattern.
- The Act's illustrations use a letter and a telegram; the text gives no separate rule for other media.
Read next
- Section 3: communication, acceptance and revocation of proposals
- Sections 5 and 6: revocation of proposals and acceptances
- Offer and acceptance: sections 3 to 9
Disclaimer: Based on the text of the Indian Contract Act, 1872 as consulted on 1 October 2026. Many questions under this Act turn on case law and on the wording of the particular contract, which this article does not cover. It is general information, not legal advice; check the official text and take advice before acting.