It is clearly stated in section 38 that the effect to refusal to a correct tender where a promisor has made a correct tender but the promisee refuses it, the promisor will remain no longer responsible for the non-performance. He also does not lose his right under the contract. Thus, the effects of refusal of a tender are:

1) Promisor becomes free from his responsibilities to the contract

2) His rights against the promisee as per the contract continue.