Chapter - 20 To 25 PDF

Chapter XX
Obligations in the Nature of Trust

"A constructive trust is the extension of a court's conscience, its foundations
unjust enrichment:
are vesting of property in the defendant and the principle of
absence of confidence has no relevance."
SYNOPSIS
(i) General
1. Text of Sections 80 to 96 (ii) Constructive Trust: A Remedy
2. (a) Resulting Trusts (Sections 81 to 85) or a Trust ?

(b) Constructive Trusts (Sections 86 to (iii) Instances
94)
1. TEXT OF SECTIONS 80 TO 96
obligation in the
80. Where obligation in nature of trust is created—An
nature of a trust is created in the following cases.
execution or executed without exhausting trust-
83. Trust incapable of
property.—Where a trust is incapable of being executed, or where the trust is
completely executed without exhausting the trust-property, the trustee, in the absence
of a direction to the contrary, must hold the trust-property, or so much thereof as is
unexhausted, for the benefit of the author of the trust or his legal representative.
Illustrations
(a) A conveys certain land to B—

"upon trust", and no trust is declared; or
"upon trust to be thereafter declared", and no such declaratio n ,is ever made; or
upon trusts that are too vague to be executed; or
upon trusts that become incapable of taking effect; or
"n trust for C". and C renounces his interest under the trust.
In each of these cases ii holds that land for the benefit of A.
B, in trusts to pay the interest annually
(b) A transfers Rs 10.000 in the four per cent to
accruing due to C for her life. A dies. Then C dies. B holds the fund for the benefit of
A's legal representative.
(C) A conveys land to B upon trust to sell it and apply one moiety of the proceeds for
certain charitable purposes, and the other for the maintenance of the worship of an
sells the land, but the charitable purposes wholly fail, and the maintenance of
idol. B holds the first
the worship does not exhaust the second moiety of the proceeds. B
moiety and the part unapplied of the second moiety for the benefit of A or his legal
representative.
B, to be laid out, in buying land to be conveyed for
(d) A bequeaths Rs 10,000 to holds for the benefit of
purposes which either wholly or partially fail to take effect. B
legal representative the undisposed of interest in the money or land if purchased.
A's
the owner of property transfers it
84. Transfer for illegal purpose—Where
to another for an illegal purpose and such purpose is not carried into ex'ecution, .
permitting the
or the transferor is not as guilty as the transferee, or the effect of
Ss 81, 82 and 94 have been repealed by Benami Transactions (Prohibition) Act, 1988—
See Chap. 3, maxim 9, ante.
[338]
Obligations in the Nature of Trust 339
transferee to retain the property might be to-defeat the provisions of any law, the
transferee must hold the property for the benefit of the transferor.
85. Bequest for illegal purpose.—Where a testator bequeaths certain
property upon trust and the purpose of the trust appears on the face of the will to
be unlawful, or during the testator's lifetime the legatee agrees with him to
apply the property for an unlawful purpose, the legatee must hold the property
for the benefit-of the testator's legal representative.
Bequest of which revocation is prevented by coercion.—Where property is
bequeathed and the revocation of the bequest is prevented by coercion, the
legatee must hold the property for the benefit of the testator's legal
representative
86. Transfer pursuant to rescindable con tract.—Where property is
transferred in pursuance of a contract which is liable to rescission or induced by
fraud or mistake, the transferee must, on receiving notice to that effect, hold the
property for the benefit of the transferor, subject to repayment by the latter of
the consideration actually paid.
87. Debtor becoming creditor's representative—Where a debtor becomes
the executor or other legal representative of his creditor, he m.'r hold the debt
for the benefit of the persons interested therein.
88. Advantage gained by fiduciary.—Where a trustee, executor, partner,
agent, director of a company, legal adviser, or other person bound in a fiduciary
character to protect the interests of another person, by availing himself of his
character, gains for himself any pecuniary advantage, or where any person so
bound enters into any dealings under circumstances. in which his own interests
are, or may be, adverse to those of such other person and thereby gains for
himself a pecuniary advantage, he must hold for the benefit of such other person
the advantage so gained.
illustrations
(a) A, an executor, buys at an undervalue from B, a legatee, his claim under the will. B is
ignorant of the value of the bequest. A must hold for the benefit to B the difference
between the price and value. -
(I.') A, a trustee, uses the trust-property for the purpose of his own business. A holds for
the benefit of his beneficiary the profits arising from such user.
(c) A. a trustee, retires from his trust in consideration of his successor paying him a stim
of money. A holds such money for the benefit of his beneficiary.
(d) A, a partner, buys land in his own name with funds belonging to the p1nership. A
holds such land for the benefit of the partnership.
(e) A, a partner, employed on behalf of himself and his co-partners is negotiating the
terms of a lease, clandestinely stipulates with the lessor for payment to himself of a
lakh of rupees. A holds the lakh for the benefit of the partnership.
(f) A and B are partners. A dies. B, instead of winding up the affairs of the partnership,
retains all the assets in the business. 8 must account to A's legal representative for the
profits arising from A's share of the capital.
(g) A. an agent employed to obtain a lease for B, obtains the lease for himself. A holds
the lease for the benefit of B.
340 Equity. Trusts and Specific Relief [Chap.
(h) A, a guardian, buys up for himself incumbrances on his ward B's estate at an
undervalue. A holds for the benefit of B the incumbrances so bought, and can only
charge him with what he has actually paid.
89. Advantage gained by exercise of undue influence.—Where, by the
exercise of undue influence, any advantage is gained in derogation of the
interest of another, the person gaining such advantage without consideration, or
with notice that such influence has been exercised, must hold the advantage for
the benefit of the person whose interests have been so prejudiced.
90. Advantage gained by qualified owner.—Where a tenant for life, co-
owner, mortgagee or other qualified owner of any property, by availing himself
of his position as such, gains an advantage in derogation of the rights of the
other persons interested in the property, or where any such owner, as
representing all persons interested in such property, gains any advantage, he
must hold, for the benefit of all persons so interested, the advantage so gained,
but subject to repayment by such persons of their due share of the expenses
properly incurred, and to an indemnity by the same persons against liabilities
properly contracted, in gaining such advantage.
Illustrations
(a) A, the tenant for life of leasehold property, renews the lease in his own name and for
his own benefit. 4 holds the renewed lease for the benefit of all those interested in the
old lease,
(b) A village belongs to a Hindu family. A. one of its members, pays Nazrana to
Government and thereby procures his name to be entered as the inamdar of the
village. A holds the village for the benefit of himself and the other members.
(c) A mortgages land to B. who enters into possession. B allows the government revenue
to fall into arrears with a view to the land being put up for sale and his becoming
himself the purchaser of it. The land is accordingly sold to B. Subject to the
repayment of the amount due on the mortgage and of his expenses properly incurred
as mortgagee. B holds the land for the benefit of A.
91. Property acquired with notice of existing contract.—Where a person
acquires property with notice that another person has entered into an existing
contract af fCCi i iig ihat property, 01 which specific performance could be
enforced, the former must hold the property for the benefit of the latter to the
extent necessary to give effect to the contract.
92. Purchase by person contracting to buy property to be held on trust.—
Where a person contracts to buy property to be held on trust for certain
beneficiaries and buys the property accordingly, he must hold the property for
their benefit to the extent necessary to give effect to the contract.
93. Advantage secretly gained by one of several compounding creditors.—
Where creditors compound the debts due to them, and one of such creditors, by
a secret arrangement with the debtor, gains an undue advantage over his co-
creditors, he must hold for the benefit of such creditors the advantage so gained.
95. Obligor's duties, liabilities and disabilities.—The person holding
property in accordance with any of the preceding sections of this Chapter must,
so far as may be, perform the same duties, and is subject, so far as may be, to
XX] Obligations in the Nature of Trust 341
the same liabilities and disabilities, as if he were a trustee of the property for the
person for whose benefit he holds it:
Provided that (a) where he rightfully cultivates the property or employs it in
trade or business, he is entitled to reasonable remuneration for his trouble, skill
and loss of time in such cultivation or employment: and (b) where he holds the
property by virtue of a contract with the person for whose benefit he holds it, or
with any one through whom such person claims, he may, without the permission
of the Court, buy or become lessee or mortgagee of the property or any part
thereof.
96. Saving of rights of bona fi de purchasers.—Nothing contained in this
Chapter shall impair the rights of transferees in good faith for consideration, or
create an obligation in evasion of any law for the time being in force.
Sections 81 to 94 in this chapter relate to certain obligations in the nature of
trusts. The Indian Trusts Act, 1882 dots not use the terms "resulting" and
"constructive" trusts but these sections are virtually its examples. Sections 81 to
85 explain the circumstances wherein a resulting trust is created and Sections 86
to 94 put forward the instances wherein a constructive trust comes into
existence.
2. (a) RESULTING TRUSTS (SECTIONS S3-85)

As has been explained before, there is no doctrinal unity to resulting trusts
and hence creation of such a trust is not dependent on compliance with
formalities and is also not subject to all rules of express trust. In such a trust the
beneficial interest in the property results or reverts to its creator. The essential
principles regarding this type of trust have been discussed in Chapter 12, para 9.
The instances of such trusts collected by the Indian Trusts Act under Sections
83 to 85 may be reproduced as follows:
(1) Where a trust is incapable of execution or where it is completely
executed and some property remains still, the trustee must hold such
property in trust called a resulting trust. Illustrations to the section
make this clear (Section 83). But a resulting trust cannot arise "only in
the absence of a Contract to the contrary".'
(ii) Where property is transferred to another for an illegal purpose and the
same is not carried 2 Out and the transferor is not as guilty as the
transferee, there results a trust as contemplated by the section (Section
84).
(iii) Where a bequest is made for an illegal purpose, the same must be held
in trust by the legatee without any action to carry out the purpose. The
same result follows where a bequeath made is prevented by coercion
from being revoked (Section 85). This section and Section 84 must be
read with Section 4 of the Act.
1. Sir Fazalbhoy Carrimbhoy v. Official Trustee of Maharahtra (1979) 3 SCC 189. 195.
2. Petherperun,a/ v. Muniand,. 35 IA 98.
342 Equirv. Trusts and Specific Relief [Chap.
(b) CONSTRUCTIVE TRUSTS (SECTIONS 86-94)

(1) General.—Such trusts arise by operation of law. In certaifl circumstances
the legal owner of property must hold it in trust for another according to principles
of equity. It is not possible in such circumstances to observe formalities. When it
would be an abuse of confidence for the owner of property to hold the same for his
own benefit, a trust is imposed upon him irrespective of his intention. Such trusts
are called constructive trusts and they are enforced on one principle and that is, to
prevent unjust enrichment of one person at the expense of another. A somewhat
elaborate discussion of this will be found in Chapter 12, para 5, but it would be
fruitful to note some important aspects of this type of trust. No satisfactory
definition of such trust, as Snell says, has been so far produced: its concept not
having assumed a complete form and its limitations being not clear. But one thing
is clear that it arises out of an obligation imposed on conscience, says Keeton. We
may say that it is an extension of "conscience" of the equity courts. In other words,
it is a method of exposing the conscience by equity courts. There are various types
of constructive trusts. Where a person is a legal owner of property but according to
conscience he is not entitled to its beneficial interest, where property should have
been with Y. but it is with X due to a peculiar situation and where a person
intermeddles with the trust affairs and either gains or inflicts a loss to the trust, in
all such circumstances he is bound by conscience and he is said to be a
constructive trustee.
(ii) Constructive Trust: A Remedy or a Trust ?—On this point the answers
differ. According to English law, it is a variety of trusts and fiduciary relations
between the parties are necessary for its existence. According to American law,
it is a remedy and not an independent trust. Before finding an answer to this
question we must note that the area of operation and the limitations or scope of
the constructive, resulting and implied trusts are not clear and they may overlap.
Now suppose A transfers property to C, a trustee, for B's benefit for B's lifetime.
B dies and therefore the property will revert to A, the author, and in his absence
to his legal representatives. What is the justification for this position ? Is it
because of the implied intention of the testator, or becausc it wa ease of a
resulting trust, or because it is fair and just to do so? The reason may be any one
of these. English law, in such a situation, takes it as a trust in the hands of C.
But this solution does not provide answers to the following questions:
(i) Are fiduciary relations necessary for such a trust to arise?
(ii) Where such relations do not exist, does a trust arise?
(iii) By what test would you determine the rights and duties of its parties?
(iv) Is it not a novel experiment found out by the courts to supply a
remedy in cases demanding justice ?
American law considers this as a remedy springing from the court's desire
to supply one in case of unjust enrichment. Out of the two views, English and
American, the latter offers a better and reasonable approach.
Such a trust arises only where a property is vested in or transferred to the
defendant and not otherwise. At this juncture one has to note that in a constructive
XXJ Obligations in the Nature of Trust 343
trust there may not be a position of confidence existing between the parties and yet
the law imposes obligations on the parties exactly similar to trust obligations. Why
so ? Because the situation demands a solution, and a just solution is the answer.
Just as a quasi-contract (obligation in the nature of a contract) arises in spite of
absence of proposal, acceptance, consent and consideration so a constructive trust
(obligation in the nature of a trust) arises even in the absence of a position of
confidence as required by Section 3 of the T?usts Act.
(iii) Instances—The Indian Trusts Act has collected those instances in
Sections 86 to 93 wherein such trusts arise and they can be briefly laid down as
under:
(1) Where property is obtained by one under a contract which is liable to
rescission, or induced by fraud or mistake, he must hold the same for
the transferor's benefit provided the transferor is prepared to do equity
and return the consideration actually paid (Section 86). This is on the
principle that the transferee has got the legal estate but not the
equitable estate.' One should read with this section Section 19 of the
Indian Contract Act and Section 35 of the Specific Relief Act.
(ii) Where a debtor becomes the creditor's representative there arises a
constructive trust because on the principles laid down in
Richards4, a debt which an executor owes to the estate Ingle will be
v.
considered as an asset in his hands because his debt is not extinguished

in equity because of his appointment as such (Section 87).
(iii) Where a person standing in a fiduciary position with another, instead
of protecting the interest of that other, gains as such for himself or
enters into dealings whereby he gains for himself and where therefore
his duties and interest conflict, he must hold that pecuniary advantage
in trust for that other person (Section 88). Illustrations to the section
amply explain these situations. A trustee, executor, partner, agent,
director of a company, legal adviser, co-decree holder and co-
mortgagee are its illustrations.
Whether or not under the situations as above a trust arises and therefore a
liability to account is imposed upon such person in fiduciary
character, or it is because on the principle of unjust enrichment that "a
liability to account for the advantages received is imposed, is an
Interesting question and its elaborate discussion is provided in
I-Ianbury 5 under the topic "Incidental Profits".
Boardman v. Phipps 6 is
a leading case on the point wherein trustees were Compelled to
account for profits gained by their position as trustees. Paragraph 6 of
Chapter 16 may be seen in this regard.
3. Re Roc/lemocauld (1897) I Ch 196.

4. (1860)28 Ba y 366.
5. Modern Equity, pp. 369 10 378.
6. (1967)2AC46
Chapter XX-A
Fiduciary Relationship
Section 88 of the Trust Act requires a fiduciary not to gain an advantage
of his position. If he acts in contravention of the provisions of the section and
gains or obtains an advantage for himself, he should hold the same for that
other person who has reposed confidence in him to protect his interests. The
section gives Illustrations of this situation. However, it has to be noted that
the section does not define a "fiduciary". Fiduciary relationship arises not from
trust only but ex lege and ex conventione also.
Definition
As Walker defines it:
"A 'fiduciary' is a person in a position of trust, or occupying a position
of power and confidence with respect to another such that he is obliged by
various rules of law to act solely in the interest of the other, whose rights he
has to protect. He may not make any profit or advantage from the
relationship without full disclosure. The category includes trustees,
Company promoters and directors, guardians, solicitors and clients and
others similarly placed."
"A fiduciary relationship", as observed by Anantnarayanan, J., "may arise
in the context of a jural relationship. Where confidence is reposed by one in
another and that leads to a transaction in which there is a conflict of interest and
duty in the person in whom such confidence is reposed, fiduciary relationship
immediately springs into existence." 2
Trust and a Fiduciary Relationship
There are two things in which an analogy exists between fiduciary
relationship and a trust. And it is because of this that it is commonly
understood that fiduciary relationship is a trust. The first point on which an
analogy can be traced is about following the property. In case of a trust the
trust property in the hands of trustee can be followed by the beneficiary as
n g& n t t'.e creditor f a tiutee, when the trustee goes bankrupt. This feature
is present in case of fiduciary relationship generally. That is, a similar remedy
would be available. 3 The second similarity is in case of remedy for a wrong.
The same remedy as is available against a trustee in respect of a wrong, when
it arises in regard to trust property, is available in case of a wrong in case of
fiduciary relationship.
Though there is a similarity in these two incidents one cannot say that a
fiduciary relation is necessarily a trust. On the contrary the fiduciary relation is a
genus, while a trust is one of its species.
I. Oxford Companion to Law, 1980. p. 469.

2. Nellie Wapshare v. Pierce Lasha & Co. Ltd., AIR 1960 Mad 410.
3. Sec Re West of England South Wales Di. Bank, Ex p. Dale & Co.. (1879) Ii Ch D 772.
[344]
Fiduciary Relationship 345
Its Nature
It is an inflexible and settled rule of equity that a person in a fiduciary

position will not be allowed to misuse his office and gain out of it. His interest
should not conflict with the interest of those whose interest he is bound to
protect. Here self-interest and self-preference are made subordinate to loyalty
towards others. In other words such a person should not be
auctor in rem suam,
that is, he should not be an agent for his owz advantage.
As said before, this relationship springs into existence out of circumstances;
it is a confidential relationship which is the product of equity in the interests of
good conscience and justice.
The fiduciary who gains on account of his position against the interests of
his confider is hound to account for the same. 4
This principle is not, as said by
Lord Herschell in.Brav v. Ford-5 , founded
upon morality; it is rather based upon
consideration of human nature: human beings being selfish by nature, and some
rule is required to check that selfishness. If it is not checked one would act as an
agent for one's own advantage.6
When Arises
Whenever two persons stand in such a situation that confidence is

necessarily reposed by one in the other, there arises a presumption as to
fiduciary relationship which grows naturally out of that confidence. Such a
confidential situation may arise from a contract or by some gratuitous under-
taking, or it may be upon previous request or undertaken without any authority.7
Important Aspects
Some important aspects of this relationship maybe laid down as under:

Office of fiduciary being onerous
one the fiduciary has to take care—A
fiduciary cannot get remuneration unless so provided. This is so because his
office is gratuitous. He has to maintain a reasonable standard of business
efficiency—(see the duties of a trustee and compare). The nature of the office of
fiduciary is such that he cannot he a purchaser
of the property under his control.
Vishwanath Shastri, J., has explained this principle as: "A transaction by a
person occupying a fiduciary position under circumstances in which his own
interests are or may be adverse to those of the persons who own the property
and whose interests he is bound to protect is always guarded by the courts with
utmost jealousy. If such a transaction is impeached... The purchaser must show
that there has been no fraud or concealment or advantage taken by him of
information acquired by him by virtue of his position. 8
His duty of office is so
onerous, demanding and exacting that one may say that he must never think of
purchasing the trust property at all. Akin to this the general rule for fiduciary is
4. Sec Rega1(1a.Tings) Lid. v. Gut/Ever, (1942) All ER 378.

5. (1896) AC 44
6. See Java Singh v. Krishna, AIR 1985 SC 1646,
7. Lw'll v. Kennetfv. (1889) 14 AC 437.
8. Eswara (Jowd V. Sarnasekhar Gowd, 1956
Andh WR 911,
346 Equity, Trusts and Specific Relief [Chap.
that he may not profit at the expense of the beneficiary. If at all he benefits, the
profit belongs to the beneficiary. He must therefore account for it and return it to
the beneficiary since it is inequitable in him to retain it. Last, but not the least, is
good faith. Good faith and honesty lie at the root of all fiduciary relations.
Transactions devoid of good faith are quite unfair and therefore liable to be set
aside. Personal interest of a fiduciary should not conflict with that of his
beneficiary. This is what Viscount Sankey in Regal (Hastings) Ltd. v. Gulliver9
and Anant Narayanan, J. in Nellie Wapshare'° observed. In short, as observed
by the Supreme Court", honesty and protection of confidence are very very
important for a fiduciary. Summing up, it may be said that good faith, honesty,
no profit from one's office and position, no purchase of beneficiary's interest
and no remuneration for working as a fiduciary are some of the important rules
for a fiduciary.
Types
Section 88 applies to a trustee, executor, partner, agent, director of a
company, legal adviser or other persons bound in fiduciar y character. Kinds of
these other persons bound by fiduciary character may be enumerated as under:
(1) Trustee (see their duties and lia)1it,cs),'2
(2) Director of a company,°
(3) Partner,14
(4) Agent,
In Sankara Kurup ca.e an agent was employed to purchase property
on behalf of his principal. He does so in his own name. Consequently,
upon conveyance or transfer of the property to the agent, he stands as
a trustee for the principal. The property in the hands of the agent is for
the principal and the agent stands in the fiduciary capacity for the
beneficial interest he had for the property as a trustee.
(5) Executor,"
(o) Lcgai Aiviser,
(7) Manager of a joint family,18
9. (1942) All ER 378.

10. AIR 1960 Mad 410.
11. Controller of Estate Dut y v.AlokMitra, AIR 1981 Sc 102.
12. Illustrations (b), (c) to S. 88.
13. Co-op. Co. lid. v. Bhagwandas & Co., AIR 1930 All 615; Comnir. of Agricultural Income
Tax v. Shree lionummz Sugar Mills Lid., AIR 1965 Pat 58.
14. Illustrations (€1), (e), (f) to S. 88; Mathura Durt B/iou v. Prem Bhallabh Khulba. AIR 1961 All
19.
15. Illustration (g) to S. 88; P. V. Sankara Kurup v. Leelavathi Nambiar, (1994)6 SCC 68, 70, 71:
AIR 1994 SC 2694.
16. Ibid.
17. Illustration (a) to S. 88; Re Macka y v. Gould, (1906) 1 Ch 25; Venkatsubrarnania v.
Sivagurunath. 1938 Mad 64.
18. N.C.T. Chidambaram v. C.A.C. Subramijuiam. AIR 1982 Mad 228.
IX-A} Fiduciary Relationship 347
(8) Parent and child,19

(9) Religious, medical and other advisers,
(10) Guardian and Ward,20
(11) Licensees appointed on remuneration to purchase stocks on behalf of
government,21
(12) Confidential Transactions wherein confidence is reposed, 22 and which
are indicated by—
(a) Undue influence,
(b) Control over property,
(c) Cases of unjust enrichment,24
(d) Confidential information,25
(e) Commitment ofjob,26
(13) Tenant for l i fe 27
(14) Co-owner,28
(15) Mortgagee,29
(16) Other qualified owners of property,30
(17) De facto guardian,31
(18) Receiver,32
(19) Insurance Company,33
(20) Trustee de son tort,M
(21) Co-heir,35
(22) Beriamidar,36
19. Brahma Raj Singh v. B.R. Devi, AIR 1982 HP 87.

20. Illustration (h) to S. 88.
21. State of Madras V. Ja y alaxmj Rice Mills Conrrac:çrs,
AIR 1959 AP 352.
22. Subhas Chandra v. Ganga Prasad, AIR 1967 Sc 878:
Debi Prasad v. Chhore Lai, AIR 1966
All 438; Hodgson V . Marks, (1971) 2 All ER 684.
23. See S. 89.
24. Boardman v. Phipps, (1967)2 AC 46.
25. Regal Hastings lid. v. Gulliver, (1942) All ER 378.
26. Reading v. R., (1949) KB 232.
27. Rajendra Prasad v. R.P. Sao, AIR 1985 Pat 104;
See S. 90.
28. ibid.
29. Ibid.
30. Ibid.
31. Abdul Wajid v. Oosman Abdul Rubb, 1943 Mad 154.
32. Seerangathurti v. Vaithilinga, 1921 Mad 528.
33. Ramkrishna lyer v. Si. Gen. Assurance Co.,
1942 Mad 210.
34. Moosabhj v. Yacob Bhai, 29 Born 267.
35. Kathr BathuiTunal v. Meera M. Amnial, (1945)
1 MU 338: 1945 Mad 303,
36. In view of Benarnj Transactions (Prohibition) Act, 1988, the benamidar's position is no longer
the same as it was before the Act.
348 Equity, Trusts and Specific Relief
These transactions may fall in various broad categories like commercial

transactions, confidential transactions, domestic transactions, jural transactions,
professional transactions, public transactions and trusteeship transactions.
(iv) Similarly, advantages gained by exercise of undue influence or by a
qualifie& owner 37 must be held in trust for the benefit of that other
are
(Sections 89-90). Huguenin v. Baseley38 and Alicard v. Skinner39 40
leading instances on the point. A tenant for life, co-owner,
mortgagee4 ' and co-sharer are the instances of this situation and they
are illustrated in the examples attached to the section. Sorabjee v.
43 Section
Dwarkadas42 may be cited as a leading case on this point.
63 of the Transfer of Property Act, it must be noted, should be read
subject to Section 90 of the Trusts Act, i.e., a mortgagor is not only
entitled to accession to his property but also entitled to acquisitions
made by the mortgagee for his own benefit in circumstances which
bring him within Section 90 of the Indian Trusts Act.
(v) Where property is acquired by a person with notice of an existing
contract which is capable of specific performances he must hold the
same in trust under Section 91. One must note that here a contract
raises a trust.
(vi) Where a person buys property :.h he knows is to be held on trust,
he is subjected to a constructive trust under Section 92.
(vii) Advantage secretly gained by one of co-compounding creditors must
also be held in trust under Section 93.
Section 95 fixes the obligee (trustee) holding property in accordance with
any of the preceding sections, with duties, liabilities and disabilities as those of
the actual trustee. Such a person is entitled to suitable remuneration as the
occasion demands. But the rights of a bona fide transferee in good faith and for
consideration are not impaired by these provisions.
37. Namdeo Shreepati Nate v. Bapu Gwipati Jagtap. (1997) 5 SCC 185.
38. (1807)15 Ves 180.
39. (1887) 36 Ch 145,
40. Md. !.crajil, AIR 1971 Pat 350.
41. Mahabir Singh v. Rameshwar Singh, AIR 1979 Pat 46.
42. (1932) 36 CWN 947 (PC).
Mrutyunjay v. Narmada. AIR 1961 SC 1353.
43 See also Sataded V. Kamal. AIR 1953 Pat 27 and
PART IV
SPECIFIC RELIEF OR EQUITABLE REMEDIES
Chapter XX!
Equitable Remedies-Nature and Scope
One of the most striking characteristics of equity has been its
inventiveness in providing a diversity of remedies.
"The remedies at law were thus both circumscribed and impersonal.
The law acted in pursuance only to c limited extent. . . Equity supplemented
the limited range of legal remedies by providing a wide range of new
remedies. . . These remedies gradually evolved and became settled in their
rules and principles.
—Snell 's Principles of Equity, p. 569
"Throughout these several departments of jurisdiction runs the
common principle that the Chancellor addresses himself' directly to the
conscience of the individual, acting in personarn by means of a subpoena
and being therefore independent of territorial limits ofjurisdicrion."
—C.K. Allen: Law in the Making, p. 413
SYNOPSIS
1. General 4. Specific Relief Act, 1963: Scheme
2. Basis of Equitable Relief 5. Specific Relief
3. Equitable Remedies 6. Sections 1-4
1. GENERAL
Specific relief, as form of judicial redress, belongs to the law of procedure,

and in a body of written law arranged according to the natural affinities of the
subject-matter would find its place as a distinct part or other division of the Civil
Procedure Code. This has not happened in India because some centuries ago,
the Kings ordinary civil courts of law had but limited remedies and in many
cases the Kings justice was in default. It is now familiar learning to all students
of legal history that in the early stages of judicial institutions we constantly find
that the power of courts to enforce decisions or even to compel the appearance
of parties is rudimentary if not wholly wanting. There is, therefore, nothing to
be surprised at in the limited scope of common law remedies in the Middle
Ages. The question why it was not enlarged until the latter part of the nineteenth
century has its own historical reasons. Meanwhile, the Chancellor, exercising
the King's reserved power of doing justice in an extraordinary way where the
ordinary means failed, had undertaken to make the defect good. It is only in
quite recent times that the courts have acquired power to do without any
concurrence of a party in default that which he ought to have done.'
Hence were derived both the strength and the weakness of the courts of
equity. They could do much that a court of common law could not do; but tF.y
had to justify their action on the ground that the suitor showed some special
cause for seeking a kind of relief which was onginally conceived as
1. Pollock & Mulla: Indian Contract Ac! and Specific Relief Ac!, 9th Edn., 1972.
See also Snell's Principles of Equity, 569. pp. 805-806.
p.
351
extraordinary. This was especially so in cases where the plaintiff had a legal
right, a right for which the Common Law provided some remedy, but was
inadequate in the sense of not being capable of doing full justice in the case The
.2
doctrine and practice of specific performance belong to this class
The word 'specific' in the expression specific relief implies a precise
reference to one particular thing or to certain details among several. It may
therefore be said to be a definite or an exact positive remedy. 3 It aims
consequently at the exact fulfilment of an obligation and is directed
straightaway to the obtaining of the very thing which a person is entitled under a
contract and of which he had been deprived. In words of Dr Baneijee it is
directed to the obtaining of the very thing that a party is under the law entitled to
ask for, whether it be an act or a forbearance. Specific relief thus though more
exact is very delicate and more difficult to administer and requires more skill
and care on the part of a judge: and hence the guidance in the form of this
legislation in India.
BASIS OF EQUITABLE RELIEF
Inadequacy of the remedies at law and the elastic willingness of equity to
use its discretion 4 directly with reference to the conscience of the individual
were the two main foundations of equitable relief. For this purpose the equity
courts invented the working principles, called the maxims, and in granting relief
it relied on the same, mainly-
(i) he who comes to equity must come with clean hands:
(ii) he who seeks equity must do equity; and
(iii) delay defeats equity.
The Specific Relief Act, 1963 5 in India relies on the English principles of
equity in granting or refusing such relief.
EQUITABLE REMEDIES
As said before, equity supplemented the limited range of legal remedies by
acting in personam and by providing a wide range of new remedies. They
were—
-(15 specific performance;
(ii) delivery up and cancellation of documents;
(iii) rescission of contracts and rectification of instruments;
(iv) ordering accounts in proper cases;
issuing injunctions; and
(vi) appointment of receivers.
2. Ibid.
3. Funk & WagnalLv: Standard Handbook of Synonyms, Antonymv & Prepositions, Pp. 190-191.
4. SceAjir Prasad fain v. N. K. Widhani, AIR 1990 Del 42.
5. Originally Specific Relief Act, 1877.
XXIJ Equitable Remedies-Nature and Scope 353
Besides, discovery of documents, suits for perpetuation of testimony,

time! action (a remedy granted to the petitioner because ''he fears what he quia
will
suffer in the future"), bills of peace and new exear regno (whereby a person
who owed an equitable claim to the petitioner was restrained from proceeding
outside the country without first giving security for the sum claimed) were the
main remedies.
4. SPECIFIC RELIEF ACT, 1963; SCItEME

The Specific Relief Act, 1963 in India grants the following remedies,
dividing them as specific relief (Sections 5 to 35) and preventive relief (Sections
36 to 42):
(i) recovering possession of property (Sections 5-8);
(ii) specific performance of contracts (Sections 9-25):
(iii) rectification of instruments (Section 26);
(iv) rescission of contracts (Sections 27-30);
(v) cancellation of instruments (Sections 31-33):
(vi) declaratory decrees (Sections 34-35); and
(vii) injunctions (Sections 36-42)
S. SPECIFIC RELIEF
Common Law relief or legal relief was mainly compensatory while
equitable relief was specific. As noted by Woodroffe: 6 "The remedies for the
non-performance of a duly enforceable by law are either compensatory or
specific.
compensatory remedy is by the award of damages which is often
useless and inadequate. Useless where the person ordered to pay them is
insolvent, and inadequate where for instance the duty is to transfer particular
immovable property or a movable property to which special interest is attached.
The specific remedy is enforced by directing the party in default to do or forbear
the very thing which he is bound to do or forbear, and in case of disobedience,
by imprisonment or attachment of his property, or both,
When no one is in default, it is enforced by making such declarations and
orders as the nature of the case may require". Specific performance can be
distinguished from injunctions. The former, as noted by Story, is directed to
compelling performance of an active duty and is corn. med mainly with
Contracts, whereas the latter is generally directed to preventing the violation of a
negative duty and deals not only with contract but also with torts and many
other equitable subjects. As Maitland observes, specific performance applies to
agreements for sale of land or lease of land as a matter of course; its application
outside these lines is somewhat exceptional and discretionary.
6. Whitely Stokes quoted in Woodroffe on Injincnons.

6. SECTIONS 1-4
The Specific Relief Act, 1963 was not meant to be an exhaustive code with
all kinds of specific reliefs incorporated therein, but refers to only that branch of
reliefs which could be obtained in civil suits. In its essence, the law of specific
relief is, a part of the law of procedure, for, specific relief is a form of a judicial
redress .7 It is adjective law. 8 That is why the Act starts by stating its object, "to
define and amend the law relating to certain kinds of specific reliefs". Specific
reliefs obtainable in criminal and revenue courts is outside the precincts of this
Act. The Act is therefore not exhaustive. 9 When a case is governed by any
section of the Act, the court must in the first instance examine the language of
the section and find out its natural meaning. 10 It will be seen that the Act is
based on the rules and practice of the English Law in relation to the doctrine of
specific performance and the sections must be interpreted in that light, but
where there is an express divergence by the section then it will be strictly
adhered to, whatever may be the English Law on the point."
The Act extends to the whole of India except the State of Jammu and
Kashmir. Illustrations to the sections, it will be seen, have been removed as they
do not serve any useful purpose in clarifying the provisions
Relief in general means the remedy ..ourt of justice may afford to some
actual or apprehended wrong or injury' 2 and the Act gives relief for the purpose
of enforcing individual civil rights and not for the mere purpose of enforcing a
penal law (Section 4). This means that enforcement of a penal law must not be
the sole object of the suit. Moreover grant of relief of declaration tending to
affect the fr...e flow of capital and mercantile business would be unjust.' 3 Section
3, onc must note, recognises the fiduciary character of personal obligation
created by a contract of sale. 14 The jurisdiction to order specific performance of
a contract is based on the existence of a valid and enforceable contract; where it
is not so, the specific performance will not be ordered.15
7. Ali Hasan v. Rajkumar Ilaldar, AIR 1943 Cal 417.426: 208 IC 473: 47 CWN 557: 77 CU 216.
8. Rod/icy Shvam v. Krw, Bala Dw,i. AIR 1971 Cal 314: 74 CWN 573; Bancrjec: Law of Sp.
Relief. 9th edri. 1992, p. 3.
9, (-flagerfard Investineizi Trust lid. v. liaridas Murlid,'iar, AIR 1972 SC 1826: 1972 SCO 78:
(1972) 2 SCA 199: A viraL Kuntar Shrivastar'a v. National Insurance Co.. (1998) 4 SCC 361:
1998 SCC (L&S) 1137: (1998)2 LILT 699.
10. Bank of England v. Vagliano Brothers, 1891 AC 107; Ramdas Vithaldas Dzzrbar v. S.
An,erc/,and & Co., AIR 1916 PC 7: 43 IA 164; Ardeshir Mama v. Flora Sassoon, (1928) 55
IA 360: AIR 192$ PC 208.
IL Akslravalurgam Pillai v. AvayamL'ala Amoral, 64 MU 536: AIR 1933 Mad 386; Rarnnath v.
Shitnoga Bank Ltd., A. No. 120 (Mys HC) '948-49, quoted in Indian Digest, 1951: AIR 1951
Mys 59.
12. Sarsuil v, Knit) Ikhari L.al, ILR (1883)3 All 345.
13. American Evpre.v.r Bank Lid. v. Calcutta Steel Co., (1993) 2 SCC 199, 213.
14. Narandas Karsondas v. S.A. Kan,tam, (1977) 3 SCC 247: AIR 1977 SC 774: (1977) 2 SCR
341.
15. Mayawanti v. Kau.vhalyadevi, (1990) 3 SCC I.

Chapter XXII
Recovering Possession of Property
Suits under both the sections are mutually exclusive; if a suit is
brought under Section 9 (new Section 6) for recover, of possession,
question of title cannot be raised or determined, while in a suit under
Section 8 (new Section 5) a plaintiff sues to establish his title for recovery of
possession."
Ananta Kumar Sarkar v. Meghu Kurmi,
(1957) 61 Cal WN 347
"Scope and Object of Section 9 is:
(i) to restore a person dispossessed otherwise than in due course of
law (and) Fazal Hussain v. Abdul Lrij AIR 1955 NUC Ajmer
334.
(ii) to discourage people from taking law into their own hands
however good their title ma be."
M. C. Batra v. Lakshmni Insurance Co. Ltd.,
AIR 1956 All 709.
SYNOPSIS
1. Recovery of Property (a) History
2. Text of Sections 5 to 8 (1') Comments
1 Recovery of Specific Immovable Illustrations
Property (Sections 5 and 6) (c) Difference between Section 7 and
4. Recovery of Specific Movable Property Section 8
(Sections 7 and 8) (d) Burden of Proof
I. RECOVERY OF PROPERTY
Sections 5 to 8 make provisions for recovering possession of property,
movable and immovable. The procedure for the purpose is laid down in the
Civil Procedure Code, Order 21, Rules 35 and 36. Section 7 speaks about a suit
by a person dispossessed of immovable property and Section 8 explains that a
person holding movable property not as an owner may be compelled in suitable
cases to deliver it to the person entitled to its immediate possession.
Possession, as Salmond has explained, is a very vital relationship which
needs protection from every system of law. All things we need to use and
consume must be in our possession. It is, therefore, the most basic relationship
between men and things. One must however note that the provision in Specific
Relief Act is founded more on public policy than on Jurisprudence)
The question is, what relief is afforded by law to a person who has been
deprived of his property (and therefore wants to recover the property): the
mmnner of acquisition and the extent of his interest therein being questions
different from this. Where property is vested in law the person dispossessed of it
1. Kri.rliria Kishore Firm v. Govt. ofA.P., (1991) I SCC 184: AIR 1990 SC 2292.
1 355 1
has stronger reasons for getting specific relief and it will be for the defendant to
show cause why the relief should not be granted against him. Where the
property is vested in equity it will be for the plaintiff to explain why he should
be granted specific relief. Putting the situation in a different way, when a person
is deprived of his property or of any interest or right therein, he is entitled to
have it back and enjoy or use the very interest or right thereto, as it is his own,
and no amount of money compensation- is adequate to satisfy his loss.
Remembering this general basic principle we now look to the provisions of the
Act in this regard.
2. TEXT OF SECTIONS S TO 8
Recovering Possession of Property

5. Recovery of specific lmrnovabk property—A person entitled to the possession of
specific immovable property may recover it in the manner provided by the Code of Civil Procedurc,
1908(5011908).
6. Suit by person dispossessed of immovable property.--(I) If any person is dispossessed
without his consent of immovable property otherwise than in due course of law, he or any person
claiming through him may, by suit, recover possession thereof, notwithstanding any other title that
may be set up in such suit.
(2) No suit under this section shall be brought—
(a) after the expiry of six months from the date of dispossession; or
(b) against the Government.
(3) No appeal shall lie from any order or decree passed in any suit instituted under this
section, nor shall any review of any such order or decree be allowed.
(4) Nothing in this section shall bar any person from suit to establish his title to such property
and to recover possession thereof.
7. Recovery of specific movable property—A person entitled to the possession of specific
movable property may recover it in the manner provided by the Code of Civil Procedure, 1908 (5
of 1908).
/irplunafion I—A trustee may sue under this scctiOn for the possession of movable property
to the beneficial interest in which the person for whom he is trustee is entitled.
Z.—A 3 VCL1,ii ui temporary right to the present possession of movable property
is sufficient to support a suit under this section.
8. Liability of person in possession, not as owner, to deliver to person entitled to
inmediate possession.—Any person having the possession or control of a particular article of
movable property, of which he is not the owner, may be compelled specifically to deliver it to the
person entitled to its immediate possession, in any of the following cases—
(a) when the thing claimed is held by the defendant as the agent or trustee of the
plaintiff;
(b) when compensation in money would not afford the plaintiff adequate relief for the
loss of the thing claimed;
(c) when it would be extremely difficult to ascertain the actual damage caused by its
loss;
(6) when the possession of the thing claimed has been wrongfully transferred from the
plaintiff.
Explanation—Unless and until the contrary is proved, the court shall, in respect of any article
of movable property claimed under clause (b) or clause (c) of this section, presume-
XXII] Recovering Possession of Property 357
(a) that compensation in money would not afford the plaintiff adequate relief for the loss
of the thing claimed, or, as the case may he
(b) that it would be extremely difficult to ascertain the actual damage caused by its loss.
3. RECOVERY OF SPECIFIC IMMOVABLE

PROPERTY (SECTIONS 5 AND 6)
Although provision in Specific Relief Act empowering a person or tenant to
recover possession if he has been evicted forcibly by landlord, may be judicial
and not lawful or a tenant holding over is not in lawful possession unless
landlord agrees or acquiesces expressly or impliedly but that does not alter the
legal position about possession of a person not legal, yet not without interest.
The provision in Specific Relief Act, it should be remembered, is founded more
on public policy than on jurisprudencc.2
In Indian Iron & Steel Co. Ltd. case 3
there was a title suit for possession
and for restraining the occupant-defendant from pulling down the structures on
the site. The structures did not belong to the owner of the title. Under the
circumstances decree although upheld, the plaintiff was directed to pay
compensation to the defendant, for such structures.
The object of the provisions is to discourage people from taking the law into
their own hands. The sections provide a speedy and summary remedy through a
medium of civil court for restoration of possession to the dispossessed. Section
5 thus provides for a suit for ejectment on the basis of title 4
and Section 6 gives
a remedy without establishing title, provided the suit is brought within six
months of the date of dispossession. The sections thus give remedy in the
alternative.
The object of Section 6 is to discourage forcible dispossession and to enable
the person dispossessed to recover possession by merely providing previous
possession and wrongful dispossession without proving title, but that is not the
only remedy .6 He may bring a suit for possession on the basis of his title.7
A Suit for possession simpliciter (Section 5) differs from a suit for
possession under Section 6 in this that in the latter case a plaintiff need only
prove dispossession within six months and the defendant cannot plead a
superior title. But in the former the plaintiff can de defeated if the defendant
proves his superior title to the land. 8 Sections 5 and 6 are not mutually
exclusive.
2. Krishna Kishore Firm v. Got. of A.?.,

(1991) 1 SCC 184: AIR 1990 SC 2292; Sec also
Express Newspapers Pvt. Lid. v. Union of India, (1986) 1 SCC 133.
3. Indian Iron & Steel Co. Lid. v. Chhagarrlal Marwari,
(1994) Supp (3) SCC 719.
4. Lachman v. Sitamhhu Narain, ILR (1911)33 All 174: 7 IC 495.
5. East India Hotels Lid. v. S yndicate Bank, 1992 Supp (2) SCC 29.
6. Ibid.
7. Pollock and Mulla: Indian Contract Act & Specific Relief Act,
p.814.
8. Yar Muhammad v. Likslrmidas, AIR 1959 All 1: sec also
Mahnioedchar,j K. Ran gawala v.
AmibaiA. Rangaii'ala, AIR 1984 Guj 90: (1983)2 GLR 1481.
In Alexander case 9, the plaintiff brought a suit for possession of lands

alleging his possession for 70 years and forcible dispossession by the
defendants. The defendant denied this forcible possession and pleaded that a suit
for po'ssession did not lie without proof of title and a prior trespasser could not
eject a later trespasser, and a mere possessory suit after the expiry of six months
was not possible under Section 6 of the Specific Relief Act. In appeal the High
Court held that the plaintiff was in possession before the suit and could maintain
a suit based on prior possession without proof of title and therefore could eject
the defendants. The High Court's decision was upheld in appeal to the Supreme
Court.
Section 6 is a reproduction of Section 15 of the Indian Limitation Act, 1859,
provisions whereof are based on the Writ of Assizes in England. Its object is to
resolve the status qua ante. In England a rightful owner of property has a right
of re-entry on his property if he can do it in a peaceful and reasonable manner,
but the Indian law differs from this in that even a rightful owner cannot by self-
help regain his possession. If he does so it is a wrong. He must take the help of
court in such cases.
Section 6 thus provides a summary remedy to the plaintiff to seek
restoration of possession from defendant within 6 months of illegal recovery
of possession by the defendant without referring to the title of the plaintiff and
defendant. It is purely a possessory suit wherein status of the party is
irrelevant. In such type of suits the plaintiff is not required to prove his title or
a superior right to possession as compared to the defendant and has only to
show that he was in possession of the immovable property and he was
illegally dispossessed within a period of 6 months prior to the date of the suit.
Once the plaintiff proves case he becomes entitled to succeed and can get
status quo ante and restoration of possession of the suit premises through the
assistance of the court.' (' The question in such cases is about "prior
possession" and the question of title does not arise under this section. As held
in Jagat Singh case this section is a reproduction of a provision of the
Roman Law under which by an interdictutn de vi a person wrongfully
dispossessed from property could recover it by proving previous possession,
without being required to prove his title.
The main elements of Section 6 are:
(i) That the possession of the plaintiff must be "juridical" and he must
establish it. "Juridical possession" is the same thing as legal
possession in a more impressive form. It is a possession based on
some right and not a possession obtained by force or fraud. Such
possession, however cannot be equated with lawful possession. For
example a tenant holding possession after expiry of his lease has a
9. Nair Service Society Ltd. v. K.C. Alexander, AIR 1968 SC 1165.

10. Mansukh!aI Dhanraj Jain v. Eknath Vithal Ogale, (1995) 2 SCC 665: AIR 1995 SC 1102.
Ii Nagar !'alika v. Jagat Singh, (1995) 3 SCC 426: AIR 1995 SC 1377: (1995) 3 Punj LR 224.
XXIfl Recovering Possession of Propern 359
juridical possession, however that cannot be termed as lawful

possession. t -
As observed by the Supreme Court in Mahale case 13 where a person is
in settled possession of property, even on the assumption that he had
no right to remain on the property, he cannot be dispossessed by the
owner of the property except by recourse to law)4
This means that possession here cannot mean merely juridical
possession or the same under a valid title: it includes possession
which is excusable.
The expression "due course of law' means such an exercise of
powers by duly constituted tribunal or court in accordance with the
procedure established by law under such safeguards for the protection
of individual rights.15
(ii) That he must have been dispossessed against his will and without due
process of law. The plaintiff in such a case has to prove his previous
possession. The suit under this section is a possessory suit; it does not
refer to title of the plaintiff and the defendant. 16 If the suit is brought
after six months, the plaintiff can recover only if he proves his title to
the land. 17 The purpose behind Section 6 is to restrain a person rrom
using force and to dispossess a person without his consent otherwise
than in due course of law. 18
(iii) That a plaintiff must file a suit within six months. The plaintiff in such
a case has to prove his previous possession. If the suit is brought after
six months, the plaintiff can recover only if he proves his title to the
land. 19 Moreover, one has to note that a person dispossessed is
entitled to regain his possession; the better title of the dispossessor
is
of no relevance as it is not in issue. It therefore follows that a decision
under this section does not make or mar the original title of either
party.
Under this section court can grant interim relief of restoration of
possession, however, the power has to be exercised carefully, wisely
and in exceptional circumstances only. 21 The only prohibition under
the provisions of Section 6 is not to use force and not to use any
12. M. C' Chokalingain v. Manni Kkutavagam, (1974) I SCC 48: AIR 1974 SC 104: L4I/
Ye.shwanz Singh v. Rao Jagdi,ch Singh, AIR 1968 SC 620.
13. Krishna Ran? Mahale v. S/job/ia Venkat Rao, (1989) 4 scc
131.
14. East India Hotels Lid. v.Svnd,cate Bank, 1992 Stipp (2)
scc 29.
15. Ibid.
16. ibid.
17. Ma,isk1,/a1 DI,ai,raj Jain v. Eknaj/, V/ial Ogale, (1995)2 scc
665: AIR 1995 sc 1102.
18. Krishna Ram Ma/tale v. S/job/rn Venkor Rao, (1989) 4 scc 131: AIR 1989 SC 2097: 1989
MPU 767; East India Hotels Lid. V.
Svndjc'jte Batik, supra; See ('hocka Lingam v. Maui
Kuvasagan i . (1974)1 SCC 48.
19. Man.cukh/af Dhanraj Jan, v. Eknat/, Vithal Ogale, (1995) 2 SCC 665: AIR 1995 SC 1102.
20. Ranu'cl, Devc/,and Pala V . Jaaio,,tku,,,ar Gurdha,,das Madam, AIR 1998
Guj 120.
Equity, Trusts and Specific Relief lChap.
360
unlawful means for dispossessing a person. The position of a licensee

remaining in occupation after the expiry of the term of licence is no
better than a tresspasser and if the true owner comes into possession
of the premises without using any force or on account of fire or other
act of vis major, it would not be in the interest of justice to grant a
decree for possession in favour of such licensee under Section 6 of the
Act.2'
If the suit is one for possession against a trespasser (i.e., one who has no
title to the land) what should a plaintiff prove: should he prove his title to the
land or would proof of previous possession suffice? The answer is yes. In such
circumstances it is not necessary for plaintiff to establish his title. This is
because a trespasser has no right to disturb peaceful possession of long time of
22 The
any person on any land and he cannot reap benefit of his illegal act.
Supreme Court has accepted this view in K.C. Alexander case. 23 But one has to
note that in a suit against the trespasser after six months the period should not be
so long as to allow a trespasser's possession to ripen into prescriptive title.
In a suit for recovery of possession by licensee forcibly dispossessed by the
Municipal Corporation it was held that in such a case the licensee forcibly
dispossessed has two remedies open to him:
(i) to file a suit under Section 64 of the Easements Act, and
(ii) to file a suit under Section 6 of the Specific Relief Act. One remedy
does not bar the other. 25
No suit against the government can be brought under this section but one
must bring a regular suit and prove one's title. An order under this section is not
appealable nor reviewable except where jurisdiction is wrongly assumed.
4. RECOVERY OF SPECIFIC MOVABLE PROPERTY
(Sections 7 and 8)
(a) History.—These sections embody the English rules as to detinuc.
uf goocs;
There are three specifir tcr in respect of tho pssciuu
trespass, detention of goods or detinue and conversion. Detinue is a kind of
conversion. It consists in wrongfully detaining from the plaintiff goods to the
immediate possession of which he is entitled. 27 An action in detinue would lie
21. East India Hotels Lid.. supra.

22. Lallu Yeshwanr Singh v. Rao Jagdisli Singh, AIR 1968 SC 620: (1968)2 SCR 203; Midnapur
Zamindari Co. lid. v. N.N. Roy, AIR 1924 PC 144: 51 IA 293: 23 AU 76; Ram Rattan v.
State of U.P., (1977) I SCC 188: 1977 SCC (Cri) 85; State of U.P. v. Maharaja Dharmanda
Prasad Singh, (1989)2 SCC 505 at pp. 516-517, paras 30-31.
Naziruddin v. Abeda
23. Nair Service Society Lid. v. K.C. Alexander, AIR 1968 SC 1165; see also
Kha:un, (1989) 1 Gau LR 177, 179; Sankar Goala v. Mufiauddin, (1988) 1 Cur CC 393.
24. Narayan v. T. Ma:hayi, AIR 1966 Ker 179.
25. M.S. Baliga (dead, by his LRs) v. Mangalore City Corpn.. AIR 1998 Kant 76;
see also
Beharilal v. Bhuri Devi, (1997) 2 SCC 279: AIR 1997 SC 1879.
26. tJnder/itlls's Law of Torts, 13th Edn., p.92.
27. Ibid.
XXIJ} Recovering Possession of Property 361
only for some specific article of movable property capable of being recovered in
specie and of being seized and delivered up to the winning party. The elements
of detinue may be laid down as: (i) existence of some specific article of movable
property , (ii) plaintiff's immediate right to such property. (iii) defendant's
possession and unjust detention of the property: When the defendant has got
possession of the plaintiff's goods (whether wrongfully in the first instance, or
by keeping them wrongfully after having lawfully obtained possession) the
plaintiff can sue either for wrongful detention or for conversion, but generally
an action for detention is brought where the defendant is at the time of action
brought in wrongful possession of specific goods such as a horse or a picture,
which the plaintiff wished to have returned to him. Thus a plaintiff may
demand the specific delivery of property or, on failing thereto, he ma y demand
the value and also damages for detention of the property. Specific delivery of
the article was not available up to 1854, in England, but due to the intervention
of equity the same was made available in suitable cases where the article sought
to be obtained had a peculiar value or some association or importance attached
thereto. After 1854 this was granted without help from the equity courts, and in
1873-75 by the Judicature Acts the form of detinue was abolished, but the name
has so far survived.
(b) Conznze,s.—As the section provides, possession of specific movable
property may be recovered not only by a person entitled to "S Possession but
also by a trustee for his beneficiary and to he so entitled, a special or temporary
right to the present possession of movable property is sufficient to support a suit
under this section. Donald v ' and Oliver v. Outer 30 are leading
English cases on the point. In Ramnaili Gagoi v. Pitambar Deb Goswarni 31 ,
A
leaves an elephant in charge of B, C wrongfully takes away the elephant from
B.
B may sue C for possession of the elephant. Likewise, the railway as bailee of
goods 32 is entitled to recover them from a person who takes them from its
possession forcibly or fraudulently. If such goods are pledged it can be
recovered from the pledgee of such person too by the railway.'-' As said before,
the requisites of Section 7 are the same as the rules for detinue and the nature
and quality of the property is immaterial. It is not necessary that the plaintiff
must be an owner-,he may be a limited owner, or he may have a special or a
temporary right to possess. Thus immediate right to possess the property as
against the defendant is material.
28. Ibid., p. 96.

29. (1866) 1 QB 585: 14 LT 772.
30. (1861) II CBNS 139: 5 LT 287. Ramnath Gagni v. Pitanibar Deb Goswami, ILR (1916)43
Cal 733: 31 IC 430: AIR 1916 Cal 788. Sec Pollock and Mulla: Indian Contract Act &
Specific Relief Act, p. 820.
31. (1861) II CBNS 139: 5 LT 287; Rwnnarh Gagni v. Pitambar Deb Goswarni.
ILR (1916) 43
Cal 733: 31 IC 430: AIR 1916 Cal 788. Sec Pollock and Mulla: Indian Contract Ac! &
.V'ee,ru' Relief A r. p. 820.
32. Section IS of ihc Indian Contract Act.
33. F'urIjjjn, I)ov v. Union i'f India. AIR 1967 All 549: ILR (1967) I All 398;
Raj v. Abdul Ilcifeez, 1964 MU (Cii) 623. Sagarmal Megh
Illustrations to Section 10 of the old Act which have been dropped in this
new enactment would he informative in order to understand the scope of this
section. The same may be reproduced as under:
(a) A bequeaths kind to B for his life with remainder to C. A dies. B enters
on the land but C, without B's consent obtains possession of title
deeds. B may recover them from C.
(b) A pledges certain jewels to B to secure a loan. B disposes of them
before he is entitled to do so. A without having paid or tendered the
amount of the loan sues B for possession of the jewels. The suit
Should be dismissed as A is not entitled to their possession, whatever
right he may have to secure their safe custody.
(c) A receives a letter addressed to him by B. B gets back the letter
without A's consent. A has such a property therein as entitles him to
recover it from B.
(d) A deposits books and papers for safe custody with B. B loses them and
C finds them, but refuses to deliver them to B when demanded. B may
recover them from C, subject to C's right (if any) under Section 18
of the Indian Contract Act, 1872.
(e) A, warehouse keeper, is charged with the delivery of certain goods to
Z. which B takes out of A's possession. .4 may sue B for the goods.
A thief steals certain articles and pledges them with X (a pledgee). Such a
pledge does not confer any title to the pledgee so as to have possession and
control thereof. Its true owner can recover them and the pledgee cannot claim
compensation or resist the owner's claim. The articles of dowry given to wife
can also be claimed by the wife under Dowry Prohibition Act. 35 This is so on
the principle that the wife is the person entitled to the possession.
"Specific movable property" means property which is ascertained and
ascertainable., but not its equivalent. ml A dead body is not movable property. No
suit under this sectioft is therefore maintainable." Share Certificates 38 and
Government Securities 39 r' pecific n vabc prpcics, 'out money 4U is not
movable property.
That the plaintiff is not entitled to possession of the property or that the
property claimed by the plaintiff belongs to a third person (defence ofjus !ertii)
are not considered as valid defences. 4 ' It should be remembered that the plaintiff
must succeed or fail on his own case and cannot take advantage of weakness in
34. Sagar Mu! Megh Raj v. Abdul ilafeez, 1964 MU (CR) 623.
35. Karnini Savhani v. Puuia Chandra Sahun, AIR 19S7 Ori 134.
36. Eadu Jha!a V. Gaur Mohan Jhnla, 19 Cal 544.
37. Ma Kin v. U. Ba, AIR 1930 Rang 143: 121 IC 7Th 11 7 Rang 603.
38. 12 BLR 513
39. I2CWN 1010.
40 IihuI,a,,ev#ni'nr v. lJit'arke.v)ni'ar. AIR 1921 ( 'A 77.
$ I Atitwr y v Pe It, ,nj ri,. I St ra 504
XXII] Recovering Possession of Propern' 363
defendant's case to get a decree. The Supreme Court would not interfere in such
cases. 4
Section 8 speaks of the liability of a person in possession of movable
property not as owner, to deliver the same to the person entitled to its immediate
possession-
(i) when he holds it as the agent or trustee of the plaintiff.
(ii) when compensation is an inadequate relief for the loss to the plaintiff;
(iii) when ascertainment of actual damage caused is extremely difficult:
(iv) when possession of the thing is wrongfully transferred from the
plaintiff.
In cases covered under clause (ii) or (iii) the court presumes that the
compensation is not an adequate relief and that the ascertainment of the damage
caused is extremely difficult, unless it is proved otherwise.
(c) Difference between Section 7 and Section 8—Sections 7 and 8 speak of
the recovery of specific movable property but there is a difference between them
which is as follows:
(11 It can be seen that relief given by Section 7 is (1) of a general nature,
(ii) independent of the nature of property, and (iii) ,jtion between
the parties. The relief afforded by Section 8 is of a special character
and depends upon the nature of property and the relationship existing
between the parties, as can be seen from its clauses.
(2) Relief claimed under Section 7 is for possession of the movable
property and in alternative for compensation equal to the value of
property, whereas the relief sought under Section 8 is for the very
property i.e., for delivery of the specific movable property.
(3) Under Section 7. a suit to recover possession can be maintained even
against the owner of property if the plaintiff has vested in him the
immediate right to pOSSCSS it. Section 8 does not contemplate it suit
against the owner.
Leading cases on the sections are Wood v. Rowcliffe43 and Pa/eke v. Gray.44
(d) Burden of Proof—The section contemplates in other words the
restitution of chattels. Pollock and Mulla in their earlier editions of the treatise45
on contract and specific relief remarked that the burden of proof' thrown on the
plaintiff under a more logically developed system would be on the defendant to
show cause why it should not he just and equitable to award specific restitution.
These remarks were approved by the Madras High Court in G.J. Subbarayulu v.
42. i'UIJü/)urban Pim y,, j i,' and 1), veIapiiI,7; A iidi ('ruv v Shiv .Saro.s ivan) Iron & Steel Re-
F'r.lIjni MiIL, (1998)4 SC( 53o),
43. 1544) 3 II.irc 304
44. (i859)4 Drew 65162 ER 250.
45. Indian Contract Act and Specific RiliefAct, 9th Edn. 1972. p 821
Annarnalni Chetriar4 and led to the enactment of the explanation which now
clarifies that me burden of proof in clauses (a) and (d) rests on the plaintiff,
while the burden under clauses (b) and (c) rests on the defendant who has to
prove that the compensation would be an adequate relief and that it would not
be extremely difficult to ascertain the actual damage caused by the loss of the
chattel.
It must be noted that a plaintiff under this section has to prove that the
defendant is in possession; if he cannot, he will not get a decree .47
46. ILR (1946) Mad 174: AIR 1945 Mad 281.

47. For execution of decree under this section se Order 21. Rule 31 of Civil Procedure Code,
1908.
Chapter XXIII
Specific Performance of Contracts
"Two great remedies it invented, remedies peculiar to itself—the decree
for specific performance of a contract, and the injunctio."
* * * *
"Gn the whole I think that specific performance applies to agreements
for sale or lease of lands as a matter of course; its application outside these
limits is somewhat exceptional and discretionary."
Maitland: Lectures on Equity, pp. 301, 304
"In India we are free from these anomalies."
—Pollock and Mulla: Indian Contract
Act and Specific Relief Act, p. 823
SYNOPSIS
1. Introduction
9. Contracts which can be specifically
2. Purpose of Specific Relief enforced (Sections 10 to 13)
3. Scheme of the Topic10. What should a plaintiff prove
4. Text of Sections 9 to 25 11. Contracts which cannot be specifically
5. Principles for granting Specific enforced (Section 14)
Performance (a) Contracts involving personal skill
(a) Remedy in Personazn Statutory Servants
(b) Remedy of damages inadequate (b) Contracts involving personal
(c) Reciprocal Remedy supervision
(ci) Enforceable (Valid) Contract (c) Contracts to transfer goodwill
(e) Contracts without consideration alone
(J) No pan Performance (ci) Divisible contracts
(g) Discretionary Remedy (e) Contracts for arbitration
(h) Contracts of personal services (I) Contracts wanting in mutuality
(z) Continuous Supervision (g) Contracts to exercise a
(I) Sale of Goods cases testamentary power of appointment
(k) Specific Performance Refused (h) Contracts where compensation is
3. Applicability of English Principles in adequate relief
India (1) Agreements to lend money or to
7 Difference of the Act with English mortgage
General Principles U) Agreements to form partnership
8 Defences to an Action for Specific (k) Vague contracts
effective(1)
Performance (Section 9) Contracts in their nature
No effective contract determinable
(b) Defective Title 12. Parties to an action for Specific
(c) Mistake and Misrepresentation Performance (Sections 15. 16, 17 and
19)
(d) Great Hardship
(a) For whom contracts may be
(e) Unfairness
specifically enforced (Section 15)
U) Inadequacy of Consideration (b) For whom Specific Performance
(g) Delay and Laches cannot be enforced (Sections 16
A. Rules and 17)
B. Time when CSSCflCC of the contract (c) Persons against whom contracts
(It) Other Defences may be enforc'c. 1 (Strriin I
[365]

366 Equity, Trusts and Specific Relief I Chap.
13. When contract cannot be cnl'orccd (a) Compensatory Relief (Sections 21

except with a variation (Section IS) to 24)
14. Discretion and Powers of the Court (b) Other Reliefs (Sections 24 and 22)
(Sections 20 to 24) (c) Liquidation of damages not a bar to
specific performance (Section 23)
1. INTRODUCTION
The jurisdiction of the English court of chancery to decree specific
performance of contracts was founded on the want of an adequate remedy at
law. As Pollock and Mulla' note: "If the conception of equitable remedies had
been maintained with logical strictness, the court would have held itself bound
to examine each individual case with an open mind before deciding whether an
extraordinary remedy was called for. But after the court of chancery was
recognised as a regular and ordinary court it was impossible to affect such an
attitude, and it became the settled rule that in certain classes of cases the nature
of the case itself was, ground enough for the court's interference." At one time
contract for the sale or letting of land was presumed to be a subject-matter fit for
the exercise of this jurisdiction but in the modern doctrine of the courts of equity
it has been extended to contracts of other spees only when exceptional
circumstances make it proper to do so. As to why this doctrine does not in
general extend to sale of goods is that regularly, a complete contract for the sale
of ascertained goods transfers the property at once to the buyer, who thereupon
has all the ordinary legal rights and remedies of an owner, 2 Another and more
extensive reason is that where the goods are of a kind purchasable in the market,
whether the contract is for specific goods or not, compensation in money is an
adequate remedy: the successful plaintiff can, if he chooses, employ the damage
awarded to him in buying goods equivalent to those contracted for.
Further, it was held 3 that if the vendor of property was compellable in a
court of equity to perform his contract, he must also be entitled to come to the
court, though merely seeking payment of his purchase money; this was
commonly accounted for as being required by the principle of "mutuality" in
order to give a right corresponding with that which is given to a purchaser.4
The attitude of English law and lawyers that the remedy of specific
performance applied only to suits for land (sale or letting) as if there were no
other kinds of contracts in the world, has been criticised by Pollock and Mulla.5
In India, we are free from these anomalies but they also express their
disapproval towards the language employed by the framers of the Act, saying
that "one could wish, however, that the Specific Relief Act had not in many
places adopted the language of the old-fashioned English books". In applying
this law, they say, the best thing to do is to forget all the technicalities as
I. Indian Contract Act and Specific Relief Ac:, 9th Edition, 1972, p. 823.
2. See Sections 19 and 20 of the Sale of Goods Act, 1930.
3. Lord Cranworth in Webb v. Direct London & Portsmouth Ri. Co., (1852) 1 Dc GM & G 521:
42 ER 654.
4. Pollock & Mulla: Indian Contract Art and Specific Relief Act, p. 823.
5. ibid.
XX1II1 Specific Perfvrn,wzcc of Contracts 367
thoroughly as possible for Indian purposes. Where there is an express

divergence of the English principles and those laid down in this Act, the Act
will be strictly adhered to, whatever be the English law.6
j4URPOSE OF SPECIFIC RELIEF
The purpose of this kind of relief or remedy is to serve the ends of justice.7
It consists in doing the very act which one has agreed to do, or to omit. It
consists of both, the negative stipulations and the positive. Negative stipulations
are called Injunctions. As remarked by Pollock and Mulla. the order for specific
performance falls into two parts: the first can be of a declaratory nature and the
second contains consequential directions.
Common Law allowed, so to say, a party to a contract to break it at his
pleasure and to pay compensation without being responsible for anything more;
but equity did not approve of this. It required from the offending party's
conscience a strict adherence to and performance of that which he could not
without manifest wrong or fraud, refuse. Moreover, as the legal relief was
compensatory it was inadequate and unsuitable to the situation. Here, equity
intervened and granted specific relief. Specific performance was not one-sided,
but was "a mutual remedy". It must be noted that the defence of'mutuality' has
been abolished by the Specific Relief Act in India.
3. SChEME OF THE TOPIC
The Specific Relief Act has dealt with the topic of specific performance of
contracts in Sections 9 to 25 under the following sub-headings:
(a) Defences to specific performance (Section 9)
(b) Contracts which can be specifically enforced (Sections 10-13)
(c) Contracts which cannot be specifically enforced (Section 14)
(d) Persons for or against whom contracts may be specifically enforced
Sections (15-19)
(e) Discretions and powers of courts (Sections 20-24)
( Applicability to awards and directions to execute settlements (Section
2:5)
A,.
J'erJuinu,,:ce of Cn,iir(lc1c
Defences respecting suits for relief based on contract.—Exccpt as otherwise provided
herTiiwhcrc any relief is
claimed under this Chapter in respect of a contract, the person against
whom the relief is claimed ma y plead by war of defence any ground which is available
under any law relating to contracts. to him
6. Arrleih i r ,tfwn,, v Elura Saw (1928) 55 IA 360: !LR (1928) 52 Born 597 AIR 1928 PC
208
7. Ct. 1,aitl.irij L :140s 40 Ilquitv. Chap. XX. p. 301.
Con rractx which can be Specifically Enforced

10. Cases in which specific performance of contract enforceable—Except as otherwise
provided in this Chapter, the specific performance of any contract may, in the discretion of the
court, be enforced—
(a) when there exists no standard for ascertaining the actual damage caused by the non-
performance of the act agreed to be done; or
(Li) when the act agreed to be done is such that compensation in money for its non-
performance would not afford adequate relief.
Explanation—Unless and until the contrary is proved, the court shall presume-
(i) that the breach of a contract to transfer immovable property cannot be adequately
relieved by compensation in money; and
(ii) that the breach of a contract to transfer movable property can be so relieved except in
the following cases—
(a) where the property is not art ordinary article of commerce, or is of special value
or interest to the plaintiff, or consists of goods which are not easily obtainable in
the market;
(Li) where the property is held by the defendant as the agent or trustee of the
plaintiff.
11. Cases in which specific performance of contracts connected with trusts
enforceable.—(l) Except as otherwise provided in this Act, specific performance of a contract
may, in the discretion of the court, be enforced when the act agreed to be done is in the
performance wholly or partly of a trust.
(2) A contract made by a trustee in excess of his powers or in breach of trust cannot be
specifically enforced.
12. Specific performance of part of contract.—( I) Except as otherwise hereinafter
provided in this section, the Court shall not direct the specific performance of a part of a contract.
(2) Where a party to a contract is unable to perform the whole of his part of it, but the part
which must be left unperformed bears only a small proportion to the whole in value and admits of
compensation in money, the court may, at the suit of either party, direct the specific performance of
so much of the contract as can be performed, and award compensation in money for the deficiency.
(3) Where a party to a contract is unable to perform the whole of his part of it, and the part
which must be left unperformed either—
(a) forms a considerable part of the whole, though admitting of compensation in money;
(b) does not admit of compensation in money;

he is not entitled to obtain a decree for specific performance; but the court may, at the suit of the
other party, direct the party in default to perform specifically so much of his part of the contract as
he can perform, if the other party:—
(1) in a case falling under clause (a), pays or has paid the agreed consideration for the
whole of the contract reduced by the consideration for the part which must be left
unperformed and in a case falling under clause (Li) pays or has paid the consideration
for the whole of the contract without any abatement; and
(ii) in either case, relinquishes all claims to the performance of the remaining part of the
contract and all rights to compensation, either for the deficiency or for the loss or
damage sustained by him through the default of the defendant.
(4) When a part of a contract which, taken by itself, can and ought to be specifically
performd, stands on a separate and independent footing from another part of the same contract
which cannot or ought not to be specifically performed, the court may direct specific performance
of the former part.
XXIIIJ
Specific Performance of Contracts
369
EvplafintionFor the purposes of this section, a party to a contract shall be deemed to be

unable to perform the whole of his part of it if a portion of its subject-matter existing at the date of
the contract has ceased to exist at the time of its performance.
13. Rights of purchaser or lessee against person with no title or imperfect title
Where a person contracts to sel l . —( I )
or let certain immovable property having no title or only an
imperfect title, the purchaser or lessee (subject to the other provisions of this Chapter), has the
following rights, namely—
(a)
if the vendor or lessor has subsequently to the contract acquired any interest in the
property, the purchaser or lessee may compel him to make good the contract out of
such interest;
(b)
where the concurrence of other persons is necessary for validating the title, and they
are bound to concur at the request of the vendor or lessor, the purchaser or lessee
may compel him to procure such concurrence, and when a conveyance by other
persons is necessary to validate the title and they are bound to convey at the request
Of the vendor or lessor, the purchaser or lessee may compel him to procure such
conveyance
(c)
where the vendor professes to sell unencumbered property, but the property is
mortgaged for an amount not exceeding the purchase money and the vendor has in
fact only a right to redeem it the purchaser may compel him to redeem the mortgage
and to obtain a valid discharge, and, where necessary, also a conveyance from the
mortgagee;
(d)
where the vendor or lessor sues for specific performance of th. -uact and the suit
is dismissed on the ground of his want of title or imperfect title, the defendant has a
right to a return of his deposit, if any, with interest thereon, to his
costs of the suit,
and to a lien for such deposit interest and costs on the interest, if any, of the vendor or
lessor in the property which is the subject-matter of the contract.
(2) The provisions of sub-section (1) shall also apply, as far as may be, to contracts for the
sale or hire of movable property.
Contracts which cannot be Specifically Enforced

14. Contracts not specifically enforceab1e..1)
specifically enforced, namely__ The following contracts cannot be
(a)
a contract for the non-performance of which compensation in money is an adequate
relief;
(b)
a contract which runs into such minute or numerous details or which is so dependent
on the personal qu
alifications or volition of the parties, or otherwise from its nature is
such, that the court cannot enforce specific performance of its material terms;
(c) a contract which is in its
nature determinable
( a
contract the performance of which involves the performance of a continuous dut
which the court cannot supervise. y
(2)
Save as provided by the Arbitration Act. 1940(10 of 1940), no contract to refer present or
future d ifferences to arbitration shall be sp
ecifically enforced; but if any person who has made such
a contract (other than an arbitration agreement to which the provisions of the said Act apply) and
has refused to perform it, sues in respect of any subject which he has contracted to refer, the
Xtstencc of such contract shall bar the suit.
(3) Notw ithstanding anything contained in clause (a) or clause
1), the court may enforce specific p (c) or clause (a') of sub-section
erformance in the following cases—
(a)
where the suit is for the enforcement of a contract,—
(t)
to execute a mortgage or furnish any other security for securing the repayment
of any loan which the borrower is not willing 10 repay at once;
Provided that where only a part of loan has been advanced the lender is willing to advance the
remaining part of the Loan in terms of the contract; or
(ii) to take up and pay for any debentures of a company;
(L) where the suit is for,-
(i) the execution of a formal deed of partnership, the parties having commenced to
carry on the business of the partnership; or
(ii) the purchase of a share of a partner in a firm;
(c) where the Suit 15 for the enforcement of contract for the construction of any building
or the execution of any other work on land:
Provided that the following conditibns are fulfilled, namely-
(i) the building or other work is described in the contract in terms sufficiently
precise to enable the court to determine the exact nature of the building or work;
(ii) the plaintiff has a substantial interest in the performance of the contract and the
interest is of such a nature that compensation in money for non-performance of
the contract is not an adequate relief; and
(iii) the defendant has, in pursuance of the contract, obtained possession of the
whole or any part of the land on which the building is to be constructed or other
work is to be executed.
Persons for or against whom Contracts may be Specifically Enforced

15. Who may obtain specific performance—Except as otherwise provided by this
Chapter, the specific performance of a contract may be obtained by—
(a) any party thereto;
(b) the representative in interest or the principal, of any party thereto:
Provided that where the learning, skill, solvency or any personal quality of
such party is a material ingredient in the contract, or where the contract provides that
his interest shall not he assigned, his representative in interest or his principal shall
not be entitled to specific performance of the contract, unless such party has already
performed his part of the contract, or the performance thereof by his representative in
interest, or his principal, has been accepted by the other party;
(c) where the contract is a settlement on marriage, or a compromise of doubtful rights
between members of the same family, any person beneficially entitled thereunder;
(€1) where the contract has been entered into by a tenant for life in due exercise of a
po wcl , LI Ic I dud! hOd ii dii,
(e) a reversioner in possession, where the agreement is a covenant entered into with his
predecessor in title and the reversioner is entitled to the benefit of such covenant;
(J) a reversioner in remainder, where the agreement is such a covenant, and the
reversioner is entitled to the benefit thereof and will sustain material injury by reason
of its breach;
(g) when a company has entered into a contract and subsequently becomes amalgamated
with another company, the new company which arises out of the amalgamation;
(h) when the promoters of a company have, before its incorporation, entered into a
contract for the purposes of the company, and such contract is warranted by the terms
of the incorporation, the company:
Provided that the company has accepted the contract and has communicated
such acceptance to the other party to the contract.
16. Personal bars to relief.—Specific performance of a contract cannot be enforced in
favour of a person—
(a) who would not be entitled to recover compensation for its breach; or
XXIII] Specific Performance of Contracts 371
(b) who has become incapable of performing, or violates any essential term of, the
contract that on his part remains to be performed, or acts in fraud of the contract, or
wilfully acts at variance with, or in subversion of, the relation intended to be
established by the contract; or
(c) who fails to aver and prove that he has performed or has always been ready and
willing to perform the essential terms of the contract which are to be performed by
him, other than terms of performance of which has been prevented or waived by the
defendant
Explanation—For the purposes of clause (c),—
G) where a contract involves the payment of money, it is not essential for the plaintiff to
actually tender to the defendant or to deposit in court any money except when so
directed by the court;
(ii) the plaintiff must aver performance of, or readiness and willingness to perform, the
contract according to its true construction.
17. Contract to sell or let property by one who has no title, not specifically
enforceable-4 I) A contract to sell or let any immovable property cannot be specifically enforced
in favour of a vendor or lessor—
(a) who, knowing himself not to have any title to the property, has contracted to sell or
let the property;
(b) who, though he entered into the contract believing that he had a good title to the
property, cannot at the time fixed by the parties or by the court for the completion of
the sale or letting, give the purchaser or lessee a title free from reasonable doubt.
(2) The provisions of sub-section (1) shall also apply, as far as may bs 'a contracts for the
sale or hire of movable property.
18. Non-enforcement except with variation—Where a plaintiff seeks specific
performance of a contract in writing, to which the defendant sets up a variation, the plaintiff cannot
obtain the performance sought, with the variation so set up, in the following cases, namely—
(a) where by fraud, mistake of fact or misrepresentation, the written contract of which
performance is sought is in its terms or effect different from what the parties agreed
to, or does not contain all the terms agreed to between the parties on the basis of
which the defendant entered into the contract;
(b) where the object of the parties was to produce a certain legal result which the contract
as framed is not calculated to produce;
(c) where the parties have, subsequently to the execution of the contract, varied its terms,
19. Relief against parties and persons claiming under them by subsequent title.—
Except as otherwise provided by this Chapter, specific performance of a contract may be enforced
against—
(a) either party thereto;
(b) any other person claiming under him by a title arising subsequently to the contract,
except a transferee for value who has paid his money in good faith and without notice
of the original contract;
(c) any person claiming under a title which, though prior to the contract and known to
the plaintiff, might have been displaced by the defendant;
(ci) when a company has entered into a contract and subsequently becomes amalgamated
with another company, the new company which arises out of the amalgamation;
(e) when the promoters of a company have, before its incorporation entered into a
contract for the purpose of the company and such contract is warranted by the terms
of the incorporation, the company:
&ovidcd that the company has accepted the contract and communicated such
acceptance to the other party to the contract.
Discretion and Powers of Court
20. Discretion as to decreeing specific performance.--( I) 11 P jurisdiction to decree
specific performance is discretionary, and the court is not bound to grant such relief merely
because it is lawful to do so; but the discretion of the court is not arbitrary but sound and
reasonable, guided by judicial principles and capable of correction by a court of appeal.
(2) The following are cases in which the court may properly exercise discretion not to decree
specific performance .—
(a) where the terms of the contract or the conduct of the panics at the time of entering
into the contract or the other circumstances under which the contract was entered into
are such that the contract, though not voidable, gives the plaintiff an unfair advantage
over the defendant; or
(b) where the performance of the contract would involve some hardship on the defendant
which he did not foresee, whereas its non-performance would involve no such
hardship on the plaintiff;
(c) where the defendant entered into the contract under circumstances which though not
rendering the contract voidable, makes it inequitable to enforce specific performance.
Explanation /— Mere inadequacy of consideration, or the mere fact that the contract is
onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair
advantage within the meaning of clause (a) or hardship within the meaning of clause (b).
Explanation 2.—The question whether the performance of a contract would involve hardship
on the defendant within the meaning of clause (b) shall, except in cases where the hardship has
resulted from any act of the plaintiff, subsequent to the contract, be determined with reference to
the circumstances existing at the time of the contract-
(3) The court may properly exercise discretion to decree specific performance in any case
where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable
of specific performance.
(4) The court shall not refuse to any party specific performance of a contract merely on the
ground that the contract is not enforceable at the instance of the other party.
21. Power to award compensation in certain cases.—(l) In a suit for specific
performance of a contract, the plaintiff may also claim compensation for its breach, either in
addition to, or in substitution of, such performance.
(71 If in an y curb cult ihl' .0Urt decides t'a' sfo rnacc og'.'. b
but that there is a contract between the parties which has been broken by the defendant, and that the
plaintiff is entitled to compensation for that breach, it shall award him such compensation
accordingly.
(3) If, in any such suit, the court decides that specific performance ought to be granted, but
that it is not sufficient to satisfy the justice of the case, and that some compensation for breach of
the contract should also be made to the plaintiff, it shall award him such compensation accordingly.
(4) In determining the amount of any compensation awarded under this section, the court shall
be guided by the principles specified in Section 73 of the Indian Contract Act, 1872 (9 of 1872).
(5) No compensation shall be awarded under this section unless the plaintiff has claimed such
compensation in his plaint:
Provided that where the plaintiff has not claimed any such compensation in the plaint, the
court shall, at any stage of the proceeding, allow him to amend the plaint on such terms as may be
just, for including a claim for such compensation.
Explanation—The circumstance that the contract has become incapable of specific
performance does not preclude the court from exercising the jurisdiction conferred by this section.
XX/1[J Specific Performance of Contracts
373
22. Power to grant relief for possession, partition, refund of earnest money, etc.—(1)
Notwithstanding anything to the contrary contained in the Code of Civil Procedure, 1908
1908), an y (5 of
person suing for the specific performance of a contract for the transfer of immovable
property may, in an appropriate case, ask for—
(a) possession, or partition and separate possession, of the property, in addition to such
performance; or
(h) any other relief to which he may be entitled, including the refund of any earnest
money or deposit paid or made by him, in case his claim for specific performance is
refused.
(2) No relief under clause (a) or clause (b)
unless it has been specifically claimed: of sub-section (1) shall be granted by the court
Provided that where the plaintiff has not claimed any such relief in the plaint, the court shall,
at any stage of the proceeding, allow him to amend the plaint on such terms as may be just for
including a claim for such relief,
(3)
The power of the court to grant relief under clause (6.) of sub-section (1) shall be without
prejudice to its powers to award compensation under Section 21.
23. Liquidation of damages not .a bar to specific perfoflnance....l) A contract,
otherwise proper to be specifically enforced, may be so enforced, though a sum be named in it as
the amount to be paid in case of its breach and the party in default is willing to pay the same, if the
court, having regard to the tcmis of the contract and other attending circumstances, is satisfied that
the sum was named only for the purpose of securing the performance of the contract and not for the
purpose of giving to the party in default an option of paying money in lieu of specific performance,
(2) When enforcing specific performance under this section, the court shall not also decree
payment of the sum so named in the contract
24. Bar of suit for compensation for breach after dismissal of suit for specific
performance—The dismissal of a suit for specific performance of a contract or part thereof
bar the plaintiff's right to sue for compensation for the breach of such contract or part, as the caseshall
may be, but shall
of such breach. not bar his right to sue for any other relief to which he may be entitled, by reason
Enforcement of Awards and Directions to Execute Settlements

25. A pplication of preceding sections to certain awards and testamentary directions to
execute settlements.—Til
e provisions of this Chapter as to contracts shall apply to awards to
which the Arbitration Act, 1940 (10 of 1940); does not apply and to directions in a will or codicil
to execute particular settlement
5. GENERAL PRINCIPLES FOR GRANTING

SPECIFIC PERFORMANCE
In England, inadequacy of
the Common Law remedies in general 8 and
incompleteness of
the compensatory remedy in special became the foundation
of equijable remedies of which specific
performance was one. Granting specific
performance started from land cases and by and by it spread its tentacles to
other kinds of contracts too. As
observed by Maitland, it "applies to agreements
for sale or lease of lands as a matter
of course; its application outside these
limits is somewhat exceptional and discretionary". 9
the grant of specific performance is The basic idea underlying
that there should be a valid contract of
which specific perform ance
could be decreed; not that there should be a
8. Hutton v. Wailing, 1948 Ch 26: (1947)2 All ER 641 (Ch D).

9. Maitland: Lectures on Equity, 304.
p.
374 Equity, Trusts and Specific Relief [Chap-
breach.'° The equitable principles which regulated the grant of specific

performance by the Separate Court of Equity which existed in England at one
time have been given statutory form in India." They are as under:
In order that a decree for specific performance of a contract may be passed
it is necessary to consider whether such a relief can be granted in view of
Section 16 of the Act. it is for the appellant to prove that Section 16 does not
prohibit granting such a decree while it is for the respondent to prove
otherwise. 12
In respect of specific performance of agreement of sale of immovable
property, the same must be identifiable in order to avail relief under the Act.13
As observed by the Supreme Court in Kamlashwari Devi v. Nawal Kishore,
in view of Section 52 of the Transfer of Property Act, 1882 (doctrine of Lis
Pendens) transfer during pendency of a suit for specific performance does not
affect the right of the plaintiff.14
(,4'Remedy in Personam.—As explained by Hanbury, the decree of specific
perfofmance issues against the defendant personally and he will be compelled to
carry out his obligation if he is within the court's jurisdiction. As the
defendant's conscience was bound by the agreement, he was compelled to act
even though the subject-matter fell outside the court's jurisdiction. This
tendency to expand jurisdiction has been restricted and checkedwa nowa in
England. In India, according to some writers, no such jurisdiction is recognised,
while according to some the courts have but a limited power of making a decree
in personam.'6
is a fundamental rule that specific
(KY' Remedy of damages inadequate—It
perfofrnance will not be granted where the plaintiff would be adequately
compensated by the common law remedy of damages. 17 In other words, where
pecuniary damages are adequate or will put the plaintiff in a similar position as
if the contract had be n specifically performed, equity will not interfere to grant
specific performance But as decided in .Ieewan La! Daga v. Nilmani
pulL pcufurrnancc of an agreement to execute a mortgage will
be ordered where money has been actually advanced.
10. Hashani v. Zenab, 1960 AC 316: (1958) 3 All ER 719 (PC).

II. M.L Devender Singh v. Syed Khaja. AIR 1973 SC 2457.
12. Thakamma Mathew v. M. Azarnazhullah Khan,
1993 Supp (4) SCC 492, 497, 498: AIR 1993
SCII2O:(1993)21 ALR 170.
13. Nahar Singh v. 1-larnak Singh, (1996) 6 SCC 699.
14. I995Supp(1)SCC 141: 1995 SCC (Cri) 60: AIR 1994 SC 1200.
Modern
IS. Penn v. Baltimore (Lord), (1750) I Ves Sen 444: 27 ER 1132 cited in Hanbury:
Equity. p. 34.
16. For details see Muila: Civil Procedure Code, 13th Edn., 1965, pp. 133-136 and Maxim 12 in
Chap. III Supra.
17. Hutton v. Walling, 1948 Ch 26: (1947)2 All ER 641 (Ch D).
18. Harnett v. Yielding, (1805)2 Sch & Let 549 (Ireland).
19. AIR 1928 PC 80:55 IA 107.
XXII!] Specific Performance of Contracts 375
Reciprocal Remedy.—This remedy is a mutual or a reciprocal remedy

andcan be obtained as effectively by the vendor as the vendee. On the same
principle, contracts for minors and against minors will not be specifically
enforced. In Mir Sarwarjan v. Fakhruddin Mahorned Chowdhurj
20 , a
Mahomadan minor, on coming of age, sued the vendor for specific performance
of a contract for sale. Dismissing the case the Privy Council held that since it
was not within the competence of the guardian of a minor to bind the minor or
his estate for the purchase of immovable property, the contract was short of
mutuality or reciprocity and consequently no specific performance thereof could
be obtained by the minor. Thus, this remedy is mutual and mutuality refers to
the time when the contract was entered into. Advantage to the minor is of no
consequence here.
WYEnforceable (Valid) Contract.—The basis of specific performance is a
val contract. 21 The doctrine of part performance of a contract is an expression
of this basic Idea. Maddison v. Alderson 22 and Wakeha,n v. Mackenzi
are the
leading examples on the point. The acts of part performance done must be
referable to the contract and it must be such as to render it a fraud in the
defendant to take advantage of the contract not being in writing. It must be
noted that Section 53-A of the Transfer of Property Act (part performance) in
India requires a contract to be in writing. In short, in the words of Lord Selborne
in tvladdjson v. Alderson 24 , the gist of the situation is
that "the defendant is
really 'charged' upon the equities resulting from the acts in execution of the
contract and not upon the contract itself .25
( fr)1ontracts without consideration.—Specif i c performance would not be
awarded—to a party who has given no consideration. A contract to be valid must
be supported by consideration.{
Part Performance.—The court will not usually decree specific
performance of any part of a contract unless it can decree performance of the
whole. But in case of a divisible contract parts whereof express several,
separate, independent and distinct contracts, such a performance can be
decre16
Question of granting specific performance of a part of the contract arose in
Surya Narayana case. 27 In this case a house which was mutated in joint names
of two brothers was agreed to be sold by the appellant. Both the brothers were in
possession and enjoyment thereof. The neighbour to whom the entire property
was sold sought specific performance and it was granted. This was not correct.
20. ILR (1912) 39 Cal 232 (PC): 39 IA I.

21. Has)wm v. Zenab 1960 AC 316: (1958) 3 All ER 719 (PC);
Mavawanti v. Kaushalya Devi,
(1990) 3 5CC 1 (Defence of no contract exists, and is available to defendant).
22. (1883) 8 AC 467: 49 LT 303 (HL).
23. (1968) I WLR 1175: (1968) 2 All ER 783 (Ch D).
24. (1883) 8 AC 467:49 LT 303 (HL).
25. Hanbury: Modern Equit y . Chap. 2.
26. William (;ra/zn,,j v. Krihn0 Chandr(, Dvv. AIR 1925 NC 45: 52 IA 90
27. Surva Nara van Lipadh ya ya v. Ra,,, Roop Pandey. 1995 Supp (4)
SCC 542: AIR 1994 SC 105.
In appeal however, having regard to the principles of equity and justice partial
performance of the contract was allowed and specific performance of half of the
share of the appellant's brother was granted. Discussing the provisions of S.
20(1) the court remarked that the circumstances specified in S. 20 are only
illustrative and not exhaustive. The court would take into consideration the
circumstances in each case, the conduct of the parties and the respective interest
of the contract.
iscretionarv Remedy.-.--As observed by the Supreme Court of India the
jurisn
d icof the court to decree specific relief is discretionary and must be
exercised on sound and reasonable grounds "guided by judicial principles and
capable of correction by a court of a1. This jurisdiction cannot be curtailed
or taken away by merely fixing a sum even as liquidated damages. This is made
perfectly clear by the provisions of Section 23 (Section 20 old Act) of the Act of
1963, so that the court has to determine on the facts and circumstances of each
case before it, whether specific performance of a contract to convey a property
ought to be granted. 28 Mulla and Pollock also note in their commentary 29, this
discretion in England is intimately bound up with the historical limits of the
jurisdiction of judges. "Everyone who came to a court of equity was bound to
show that he had no remedy, or no adequate remedy in the ordinary jurisdiction
of a court of common law. Failing this his Suit would be dismissed 'for want of
equity'. Now a claim for specific performance assumes the existence of an
actionable contract. Therefore the plaihtiff had always to face the question: why
is not the common law right to recover damages good enough for your case?
and the court was in strictness always on the defensive against a charge of
trespassing on the domain of the common law. The court of chancery did indeed
establish the presumption that specific performance was the proper remedy on a
contract to convey land, but it was only a presumption liable to be displaced;
there is no absolute right to this remedy".
In exercising the discretion the court will take into account the
circumstances of the case, the conduct of the parties and their repectivc
interests under the contrart 30 Thc dzieiion is thus not arbitrary but is
controlled by certain rules of certainty, fairness and justice between the
parties.3 ' Consequently where it has been exercised perversely, arbitrarily or
against judicial principles, it will be interfered with.32
28. M.L Devender Singh v. Syed Khaja, (1973) 2 SCC 515: AIR 1973 Sc 24571 Sardar Sing v.
Krishna Devi, (1994)6 SCC 18; Kallathil Shridharan v. Kainath Pandvala Prasanna, (1996)
6 SCC 218; Lordu Mari David v. Louis Chinnaya Aragiaswamy, (1996) 5 SCC 589: AIR
1996 sc 699.
29. Indian Contract Act and Specific Relief Ac:, pp. 869-870.
30. Oxford v. Provand. (1868) LR 2 PC 135: 16 ER 472 (PC); Jethalal Nanshah Modi v. Bachu,
(1945)47 BLR 463: AIR 1945 Born 481; G. Rasaiah v. C. Balarami Reddi, AIR 1989 AP
179.
31. G. Rasaiah v. C. Balarami, AIR 1989 AP 179.
32. Pujani Narasappa v. Shaik IIarat, AIR 1960 Mys 59, Mademvezty Satyanarayana v. G.
Yclioji Rat). AIR 1965 SC 1405; Matins v. Freeman, (1837) 2 Keen 25: 48 ER 537; also see
(1994)6 SCC IS: (1996)6 SCC 218 and (1996)5 SCC 589 in foot note 28 supra.
XXIII] Specific Performance of Contracts
377
TCon tracts of personal services—Cannot be s pecifically

en forced .33
Continuous Supervision.—Specific
performance of a contract involving
con?ituous supervision of the court will not be granted.
Sale of Goods
cases—Here the damages would generally afford an
adciate remedy and therefore no specific performance will be granted. The
reason is that since the specific goods contracted for can be had from the market
such performance is uncalled for. But if
the contrary is proved as provided in
Section 10, e xplanation, specific performance will be ordered.
'pecflc Performance e.fused.—Ther&\are
compdnsat also cases wkrein though
is no an adequatè relief, the court will not dec}çe specific
Ir
performance bf a con tr'àct.
6. APP LICABILITY OF ENGLISH PRINCIPLES IN INDIA

The above general principles have been incorporated in the Specific Relief
Act. Where there are specific provisions
in the Act regarding particular
situations, the provisions of the Act prevail, and
in cases of divergence bet
the provisions and the principles abovesaid the general English principles must
give way to the specific provision of the Act as laid down in William Graham
Krishna Chandra Dey 34 v.
by the Privy Council. Moreove., as expressed in
Ardeshjr Mama v. Flora Sassoon 35 , at the time of codification of the above
principles where a reference
has been made to English rules, that must be a
guide in interpretation and application of the provisions of the Act. But where
the Act is silent
on a particular situation, the English principles and practice are
a valuable guide. 36 Besides, the principles of equity, justice and
good conscience
will apply in situations and in the fields where the Act does not apply.
7. DIFFERENCE OF THE ACT WITH ENGLISH
GENERAL PRINCIPLES
The Specific Relief Act has at many places avoided the complications of the
English law and provided clear provisions for the same as in cases of specific
performance with abatement or c
ompensation under Section 12(2) and in cases
of serious deficiency under Section 12(3). The defence of 'mutuality' prevailing
in England has been abolished by the Act. If a suit is
performance all remedies must be brought for specific
sought therein. It is for this reason that
Section 24 provides that on dismissal of such a suit no suit for compensation for
breach of agreement shall lie. This is not so in England. Besides, the doctrine of
laches with its bedroll of cases is not applicable in India in view of the
provisions of the Limitation Act, 1963, Article 54
whereby such a suit must be
brought within three years from the date fixed for performance or from the date
when the plaintiff has notice that performance is refused.
33. Page One Records tad.. V. Brion, (1968) 1

34. AIR 1925 PC 45: 52 IA 90. WLR 157: (1967)3 All ER 822 (Ch D).
35. AIR 1928 PC 208: 55 IA 360
36. Ak.cha y aljagam Pula: v. Avayambnla Animal,
AIR 1933 Mad 386.
S. DEFENCES TO AN ACTION FOR SPECIFIC

PERFORMANCE (SECTION 9)
General—A defence is denial of the plaintiff's claim. A defendant may
advance a plea of total denial of the plaintiff's claim on account of contract
having been induced and therefore vitiated by mistake, fraud and undue
influence or on the ground that the contract is one which cannot be specifically
enforced. And these we have considered before. We shall now look into the
various other defences that equity provided and the Specific Relief Act lays
down. As expressed by Sne]1 37 in his Principles of Equity, those defences may
be—
(a) no effective contract
(b) absence of writing or part performance
(c) plaintiff's misrepresentation
(d) mistake
(e) misdescription
(1) default by plaintiff
(g) lapse of time
(h) trickiness
(i) great hardship
(j Illegality
(k) defective title.
In such a suit the defendant may plead any ground available to him under
any law relating to contracts such as incapacity of parties, absence of a
concluded contract, coercion, fraud, misrepresentations mistake, illegality or
want of authority to enter into the contract 38 and so on.
Section 9 in this regard provides thit
bxcept as otherwise provided herein, where any relief is claimed under
this chapter in respect of a contract, the person against whom the relief is
claimed may plead by way of defence any ground which is available to him
under any law relating to contracts."
As the defences are scattered over various sections, we shall take them
serially in a logical and chronological order.
(a) No effective contract
Specific performance presupposes the existence of a complete and definite
contract. The statutory requirement of a written evidence of the contract, it must
be noted, "is a weapon of defence, not offence and does not make any signed
instrument a valid contract by reason of the signature, if it is not such according
37. 27th Edn., 1972, Part VII, Chap. I, pp. 583-600,

38. Pollock and MuIla: Indian Contraci Act and Specific Relief Act, p. 825.
XXIIfl Specific Performance of Contracts 379
to the good faith and real intention of the parties". 39 This means that to be
enforceable at law that agreement should not be void because of uncertainty or
illcgaluy. 40 It should also not be voidable because of lack of consent, or
presence of fraud, mistake, misrepresentation or undue influence. An
incomplete contract is also a good defence.
Unce rlainry —Want of certainty is a ground for resisting specific
performance. Certainty must be with regard to terms, parties, value, date and
description of the subject-matter. The uncertainty in a contract which may arise
in different ways must be determine1 at the commencement of the action,
because it is at that time that the non-compliance with the terms of the contract
must be incapable of justification. It is well known that there cannot be a
contract to make a contract. If the parties leave the essential terms of the
agreement undetermined, the same cannot be enforced for uncertainty, but if the
agreement is otherwise complete Leaving certain details (non-essential)
incomplete, the court will find out or ascertain them from the evidence produced
and enforce the contract, because what is essentially required is the reasonable
certainty. 4 ' But one must note that the evidence produced has to explain the
terms; it cannot be allowed to alter or vary the terms of a written agreement.-'2
Section 14(1) (b) of the Specific Relief Act expresses this "hen it speaks of a
contract which "from its nature is such that a court cannot enforce specific
performance of its terms". Section 29 of the Indian Contract Act also expresses
that an agreement, the meaning of which is not certain, or capable of being
made certain, is void. Mulla has dealt with these under the heading "Vague
Contracts".'"
(b) Defective Title
It is a good defence by the purchaser to show that the vendor cannot make a
good title to the property in accordance with the contract he made. In the same
way, where the property is encumbered or its title is doubtful, a suit for specific
performance can be resisted. In suitable cases, therefore, the purchaser may be
relieved or discharged from the contract or may repudiate the contract because
the court will not compel a purchaser to buy a lawsuit, a term which means not a
bare possibility of proceedings, but "a reasonable, decent probability of
litigation".
Section 17 of the Act lays down the Indian law on the point. It applies to
both movable as well as immovable property and to sales and leases. The
section says:
"(I) A contract to sell or let any immovable property cannot be
specifically enforced in favour of a vendor or lessor-
39. Jervis v. Berridge, (1873) 8 Ch App 351: 28 LT 481.

40. Douglas v. Ba yne.v, 1908 AC 477: 99 LT 599 (PC).
41. Shea Kumar v. G van Al ath,AIR 1955 All 408,412.
42. Gajkmarv. Luchhman,a,n (1911) 14 Cal U 627: 10 IC 503.
43. Pollock and Mulla: Indian Contract Act and Specific Relief Act,
p. 848
44. George v. Thoina.'.(1904)90LT50552WR416
(a) who, knowing himself not to have any title to the property, has
contracted to sell or let the property;
(h) who, though he entered into the contract believing that he had a
good title to the property, cannot, at the time fixed by the parties
or by the court for the completion of the sale or letting, give the
purchaser or lessee a title free from reasonable doubt.
(2) The provisions of sub-section (1) shall also apply, as far as may be, to
contracts for the sale or hire of movable property."
The section thus deals with the case wherein the seller or lessor has either
(i) no title to the property sold or let out, or (ii) where he cannot give the
purchaser or lessee a title free from reasonable doubt, and (iii) where prior to
such sale or letting he has made a settlement of the subject-matter of the
contract.
In this connection Section 55(2) of the Transfer of Property Act explains
that a seller impliedly contracts that he has an interest in the property, the same
subsists, and that he has power to transfer the same. The title must be in the
vendor himself and Section 13 of the Specific Relief Act therefore expressly
lays down the rights of the purchaser or lessee against the vendor who has no
title or imperfect title. The suit for specific performance can therefore be resisted
where the vendor's title is either defective, doubtful, encumbered or bad. One
has to note that the defect in the title must be substantial and the doubt a very
serious doubt. Section 17(1) (a) is in conformity with the view of Lord Knight
Bruce, V.C. in Adams v. Broke 45 that subsequent acquisition of title will not
entitle the vendor to enforce the specific performance even though the time
fixed for completion has not passed. This view has been confirmed by the
Nagpur High Court in Kisanlal Rudnial Agarfrval v. Namdeo Krushnaji
Dhanga6.
In the following cases, it must be noted, the title is not considered to be
open to doubt-
(i) where the doubt raised is malafide and unsupported by any proof;
(ii) where the probability of litigation is not great:
(iii) where there is an adverse decision of the inferior court regarding title
which the superior court thinks to be clearly wrong; and
(iv) where the question depends upon the general rule of construction of
words against the special context and the court is in favour of title.
In short, defective title is a good ground for resisting specific performance,
subject to the exceptions mentioned above.
45. (1842) I Y & C Ch Cas 627: 62 ER 1046.

46. AIR 1943 Nag 299.
(c) Mistake and Misrepresentation

Sections 20 and 22 of the Specific Relief Act and Section 18 of the Indian
Contract Act lay down the effects of mistake and misrepresentation on the
contract.
(d) Great Hardship
A contracts to buy a piece of land from X. There is no right of way existing
to it and nothing is mentioned in the contract above it. No right of way can be
shown to exist also. Such a contract cannot be specifically enforced because if
performance is decreed, it would create great hardship for A in so far as access
to the land is concerned. And this defect is incurable. Hardship is therefore a
good defence here.47
It must therefore be said that as a general rule if the contract is otherwise
valid or legal it does not lie in the mouth of the defendant to say that specific
performance thereof should be refused because it involves hardship to him. But
in genuine cases of hardship the court would definitely not allow specific
performance.48 And this is what is provided by Section 20(2)(b).
What is hardship.—When we say that hardship is a good defence We must
also understand in what cases and how it comes into existence and what it
means. Firstly, hardship is not the same as onerousness, because what is onerous
is mentally burdensome or oppressive. But hardship may be said to be an
untoward event or a difficulty or inconvenience usually of a lingering character
for which the sufferer is not deemed directly responsible. A contract mixed with
hardship is almost unconscionable. But where it is the creation of the plaintiff
himself as when he induces another to strike a contract by use of
misrepresentation or fraud and obtains an unfair advantage from that other9,
hardh,p and unfair advantage are good defences and the court will not decree a
specific performance of such a contract. Secondly, as the section provides, the
hardship must be one which the defendant could not foresee.-" O Moreover, the
hardship must not be such as flows from the terms of the contract; it must be
something existing side by side or collateral, 5 ' which grows from outside the
contract without the default or some other act of the defendant. Where the
defendant knowingly enters into a contract involving hardship, he would have
no defence of hardship. 52 The court in deciding such cases will look to the facts
of the case, its circumstances and the relative position of the parties at the time
of making the contract, because hardship arising subsequent to the formation of
a contract cannot be advanced as a defence against specific performance, unless
it has arisen due to some act of the plaintiff. 53 At the same time, the court will
47, Cf. Ka,nin, Suadri Chcodhranj v. Kali Prossunno Ghose, (1886) 12 Cal 225 (PC): 12 1A
215. Facts have been given under the next topic.
48. Preston v. Luck, (1884) 27 Ch D497: 33 WR317(CA).
49. Davis v. Maung Shwe Goh, 38 Cal 805 (PC): 38 IA 155.
50. Janakdhari La! v. Goscain La! Bhaya Gaywal, ILR (1910)37 Cal 107: 1 IC 871.
51. Haisbury: Laws of England, 2nd Edn., Vol. 31, para42l, p.370.
52. Rad!ia Kanra Pal v, United Bank of India Ltd,, AIR 1955 Cal 217.
53. Peer Mo/id. v. Mahmod, ILR(1905)29 Born 234:6 Born LR 1013:7 Born LR 200.
not look into the hardship of the defendant only, but will look into that of the
plaintiff too and after weighing the facts and consequences it will decree or
refuse the specific performance; not before. Explanation 2 to Section 20(2)(b)
enlightens the position mentioned above.
(e) Unfairness
As Section 20(2) (a) provides, the court may properly exercise its discretion
not to decree specific performance where (i) the terms of the contract, or (ii) the
conduct of the parties at the time of entering into the contract, or (iii) the other
circumstances under which the contract was entered into, are such that the
contract, though not voidable, gives the plaintiff an unfair advantage over the
defendant. Where A sells land to B for protection of which an embarkment is to
be maintained by A, and A does not disclose this to B but conceals this position
knowingly, the court will not grant specific performance to A because by so
decreeing A will gain an unfair advantage over B. What is unfair is far from just.
Similarly, where a pardanashin lady obtained a loan from her own mukhtar at
an excessive rate of interest, the security being ample, it was decided by the
Privy Council that as the bargain was hard and unconscionable the rate of
interest in the contract could not be enforced in equity.
Unfairness arises from the terms of the Contract or from the conduct of the
parties or from other circumstances attending the contract. It expresses itself in
various ways. It must arise at the time of entering into the contract, but it may
arise subsequent to it also, as when a contract to sell at a price to be fixed at a
future date is made or some precondition is to be fulfilled before the contract
becomes absolute. The time when the contract becomes absolute (when price is
fixed or condition is fulfilled) is the time with reference to which the fairness is
to be judged; the date of execution of the contract not being material to judge
the fairness. Unfairness arising from surrounding circumstances may take place
from mental weakness, or due to age, sex, poverty, illiteracy, or intoxication of
the parties or from any other circumstance giving unfair advantage to the
plaintiff.
(j) Inad°qr'ac)' of Considerticr
Mere inadequacy of consideration is no ground for resisting specific
performance because "the value of all things contracted for is measured by the
appetite of the contractors and therefore the just value is that which they be
contended to give". At the same time, a voluntary contract cannot be decreed on
the principle that "equity will not aid a volunteer". If the inadequacy leads to
some fraud or undue advantage by the plaintiff, that is a ground for resisting
specific performance. Similarly, inadequacy which may amount to mere
hardship is no ground for relief, but if the inadequacy is such as shocks the
conscience it is a good ground for resisting specific performance.
Explanation 1 to Section 20(2) therefore provides that mere inadequacy of
consideration or the mere fact that the contract is onerous to the defendant or
54. Kamini Sindari Chnodhrrn v. Kati Pros.cunno Ghose. (1886) 12 Cal 225 (PC): 12 IA 215.
XXIIfl Specific Perfi,rma,zce of Contracts 383
improvident in its nature, shalt not he deemed to constitute an unfair advantage

within the meaning of clause (a) or hardship within the meaning of clause (b).
The inadequacy of consideration to be a good defence must be such as to
shock the conscience of a person or to lead by itself to an evidence of fraud or
undue advantage; or when weighed with other surrounding circumstances forms
an evidence of fraud or undue advantage. Here one thing must be noted that, as
decided in Ganga Baksh v. Jagat Bahadur Singh 55, the adequacy or inadequacy
of consideration has to be determined with reference to the state of things or
circumstances surrounding or existing at the time when the contract was made
and not with reference to subsequent events. Thus inadequacy of consideration,
to be a good defence, must exist at the time when the contract was made, must
be shocking to the conscience, cannot emanate from mere onerousness of the
contract, is not obtainable by a volunteer and taken by itself or taking the
existing or surrounding Circumstances of the contract into consideration must
lead to some fraud or undue advantage obtained by the plaintiff.
(g) Delay and Laches
Section 54 of the Limitation Act, 1963 has prescribed a period for tiling a
suit for specific performance of contracts and accordingly all such suits must be
brought within 3 years from the date fixed for performance, or if no such date is
fixed, when the plaintiff has notice that performance is refused.
It is very plain that a suit for specific performance must be brought within
the time when time is the essence of the contract. Time may be made to be the
essence of the contract by express provision in the contract. This is so in
mercantile contracts. Besides, if the nature of the contract is such or if the terms
thereof are such, it may be apparent that time is the essence of the contract. Thus
where time is such, a suit for specific performance must be brought within that
time but where time is not such no party can insist for performance within a
particular period of time. But performance can be insisted upon within a
reasonable lime, according to law. And what is reasonable time is a question of
fact. If a suit for specific performance is not brought within a reasonable period
of time a decree for specific performance will not be granted.56
The basic requisites for the plaintiffs success in a suit for specific
performance of a contract are (i) his performance or his readiness and
willingness all along to perform the terms of the contract, and (ii) his readiness
and willingness to do all matters to he thereafter done. A failure of the plaintiff
in any of these respects will afford a good defence to the opposite side. 57 In
other words, he has to allege and if the fact is traversed, he must prove his
continuous readiness and willingness from the date of the contract to the time of
the hearings to perform the contract on his part.58
55. (1895)22 IA 153: ILR (1896)23 Cal 15 PC.

56. Binda Prajad v. Kishorj Saran, AIR 1929 Pc 195: 116 IC 388,
57. 371C257(DB):(1916)24 Cal u90
58. Dau Alakhra,n v. Kith',an gin Bai, ILR 1950 Nag 386: AIR 1950
Nag 238.
Article 54 of the Limitation Act, 1963 provides that a suit for specific
performance must be brought within "three years from the date fixed for
performance, or if no such date is fixed, when the plaintiff has notice that
performance is refused". This provision of the Limitation Act makes the
doctrine of laches inapplicable in India to this kind of litigation. Like England
we have no rules in the Limitation Act on the subject of delay and laches. But
from the decided cases there should be no difficulty in laying them down as
below.
A. RULES
(1) Even if mere delay does not disentitle a plaintiff to claim specific
performance of a contract, nevertheless, delay is one of the factors to be
considered while granting the discretionary relief.59
(2) Whether lapse of time destroys the plaintiffs right has to be considered
with reference to the other prevailing circumstances. If the plaintiff has been in
substantial possession of the benefits of the contract and has always been
claiming the completion of the legal estate, delay, if properly explained, will not
affect his rights to claim specific performance.60
(3) Inordinate and unexplained delay coupled with the change of conditions
is sufficient ground for refusing specific performance and dismissing the suit.6'
(4) In no case does mere delay or lapse of time deprive the plaintiff of his
right to specific performance unless it be held that—
(1) there has been abandonment,
(ii) acquiescence,
(iii) waiver, or
(iv) at the least an alteration in the position of the defendant in that the
other party has been put in a situation in which it would not be
reasonable to place him if the remedy was afterwards to be asserted.62
( 5 ) The court may exercise its discretion and not decree specific
performance where the circumstances under which the contract is made are such
as to give the plaintiff an unfair advantage over the defendant. Mere delay by
itself is no ground for refusing relief but when it raises the presumption of an
abandonment of the plaintiff's claim or has caused—
(1) a hardship to the opposite party; or
(ii) something to his prejudice.
the courts are entitled to exercise their discretion and refuse the relief prayed for,63
59. Sultan v. Sharfan, 113 IC 140(DB): AIR 1929 Lah 249.

60. ILR 1952 Cal 198.
61. Sultan v. Sharfan, 113 Ind Cas 140 (DB): AIR 1929 Lab 249: Dau Alakhram v. Kuiwantin
Bai, ILR 1950 Nag 386: AIR 1950 Nag 238.
62. Allah Dina v. ./amna Das, 117 Ind Cas 225 (DB): AIR 1929 Lah 679: 44 hid Cas 244: (1918)
4PaLW 192.
63. Ra,ni Reddj v. Pattabhirami Reddi, 169 Ind Cas 12 (DB): AIR 1937 Mad 124.
(6) Where delay does not amount to waiver, abandonment or acquiescence,
and which in no way alters the position of the defendant, it does not disentjtle
the plaintiff to sue for specific performance. Thus when the suit is within time
and the delay is not so great as to induce the court to hold that the plaintiff has
forfeited his right under the agreement, the court will not refuse equitable
relief.
(7) Where status quo position of the parties was changed, as when there was
a change in value of property, and it had occurred by reason of delay
attributable to the plaintiff, specific performance was rightly refused.65
(8) In cases of serious laches specific performance is refused, but where the
plaintiff was guilty of delay of over two years in filing suit 6 , or where he
delayed till the end of the limitation period unnecessarily 67
performance was refused. , specific
(9) But one has to note that mere laches or delay, even if it is up to the hilt
of the limitation period, is not always evidence of waiver and abandonment-"8
To operate as a bar to relief the delay should be such as to amount to a waiver or
abandonment of the plaintiffs right by acquiescence or where by his conduct or
neglect he has though perhaps not waived his remedy yet put the other party in a
situation in which it would not be reasonable to place hirr. :c the remedy were
afterwards to be asserted.
When such is not the case, any lapse of time short of the period allowed
under the Limitation Act should not disentitle the claimant to relief which he is
otherwise entitled.69
B. TIME WHEN ESSENCE OF THE CONTRACT7°

In Burjorji case"
the Privy Council laid down the principles governing
contracts of sale of land and when times is or is not of the essence of the
contract. Following this decision it has been held by the Indian courts that time
in contracts for sale of immovable property is not of the essence of the contract
unless the nature of the property and surrounding circumstances make it so.
Equity treats the limits of the time as subordinate to the main purpose of the
parties. 72 After Burjorji case 73 , again in
Paul Couvreur v, M. G. Shapiro 74 , the
64. JaugalS,ngh v. Ga/am Mahomed 67 lndCas
700 (D13): 32 PWR 1922: AIR 1922 Lah 461.
65. Bahadur Singh v. Suresh Chandra Roy, 34 CU 364 (DB): AIR 1921 Cal
179.
66. Nnrooshui,,r Pranshanker v. Rajumal Bhagwandas, AIR 1921 Sind 197: 15 Sind LR 2 I.
67. Ma rudanaaganr Pjtlai v. Mufll4sc,,n %
(DB), 58 Ind Cas 23. Sc also Ram (haran' Pjllaj, AIR 1917 Mad 8: 37 IC 776 37 Ind Cas 776
La! v.
(1914) 27 Mad U 482: ILR (1915) 37 All 12 Ka rim . un . Njssa Ribi, 26 Ind Cas 121 (DB):
where delay of 20 months discrititled the
plaintiff in sue for specific performance.
68. 23 Ind Cas 56 (DB).
69. Kissen Gopal Sadaney v. KaIl y
Prasno Set:, ILR (1906) 33 Cal 633, 636.
70. Pollock and Mulla: Indian Contract Act and Specific RehefAct,
71. Jamshed Khodaram Irani v. Burjorji Dhunjibhal (1916) 43 IA pp. 825-826.
26: AIR 195 PC 83: 32 IC
246.
72. Gomashinsxvagam PiIIai V.
Pillaniwamj Nadar, (1967) 1 SCR 227: AIR 1967 SC 868.
73. Jamshed Khodarao, Iran: v. Barjorji Dhunjibh
0 j, (1916) 43 IA 26: AIR 1915 PC 83: 32 IC
24.6.
Equity, Trusts and Specific Relief [Chap.
386
Privy Council again had the occasion to consider the question as to time being
of the essence of the contract and it was held that (i) reasonable time for getting
a permit applies to a contract which fails to be carried out within a reasonable
time, and (ii) where the contract falls to be completed within a fixed period and
therefore time is of the essence of the contract, to allow the purchaser
reasonable time beyond the fixed period to enable him to do what by the terms
of the contract he was required to do, would amount to making a new contract
for the parties. In Gonzathinayagam Pillai case 75, the Supreme Court after
reviewing the authorities laid down the law as below:
(1) There is a presumption in the case of immovable property that time is
not of the essence of the contract.
In the matter of enforcement of the agreement or agreement of
reconveyance, time is not always the essence of the contract unless the
agreement specifically stipulates and there are special facts and circumstances in
support thereof. It must be specifically pleaded and issue raised so that the other
party has a right to lead evidence. 76
(2) Even where a contract contains a stipulation making time the essence of
the contract, the presumption applies and more so where time for performance
has been extended more than once.
(3) Similarly, incorporating a clause imposing penalty in case of default
does not by itself evidence an intention to make time the essence. 77 In a case
where a promisor has an option either to do or to abstain from doing on payment
of the sum of money, court may treat covenants to perform or to pay as
alternative where specific performance would work unreasonable results.78
Where stipulation in a contract is uncertain and ambiguous specific performance
cannot be granted.79
It was further expressed that intention to make time of the essence of the
contract must be in unmistakable language. It may be inferred from the nature of
the property agreed to be sold, the conduct of the parties and the surrounding
circumstances at or before the contract. As observed in Chatur'edi case High
Court cannot make the essence of the contract an issue if it was not an issue in
the trial court.80
In case of contracts the object whereof is commercial enterprise, the court is
strongly inclined to hold time to be essential, e.g., agreement to purchase land
for construction of a factory. 81 It must be once again remembered that to allow
this defence is discretionary and it may be refused too in suitable cases where
74. AIR 1948 PC 192: 1948 Mad WN 121.

75. (1967) I SCR 227: AIR 1967 SC 868.
76. Btbi Jaibuntsha v. Jagdzsh Panda, (1997)4 SCC 481.
77. (1967) 1 SCR 227: AIR 1967 SC 868.
78. Mavawanti v. Kaushalya Devi, (1990) 3 SCC I.
79. ibid.
Govind Prasad Chaturvedi v. Hari Dull Shashiri, (1977) 2 scc 539: AIR 1977 Sc 1005:
80.
(1977)2 SCR 877.
Sri Ram Cotton Pressing Factory (P) Ltd. v. K.E Narayanswami Naidu, AIR 1965 Mad 352.
81.
delay had led the other party to change his position thinking that the plaintiff has
abandoned his rights.
(h) Other Defences
Moreover, where the plaintiff has not performed his part or where he has
not been continuously ready and willing to perform his part, where
compensation is an adequate relief (Section 14), where the plaintiff is not
competent to sue (Section 15), where the plaintiff, by his conduct, has
disqualified himself for the relief (Section 16), where the defendant is a person
against whom specific performance cannot be obtained or enforced (Section 19)
and where he is incapable of performing his part due to some statutory bar or
due to impossibility arising out of destruction of the subject-matter of the
contract—a good defence for resisting the specific performance is constituted.
9. CONTRACTS WHICH CAN BE SPECIFICALLY ENFORCED
(SECTIONS 10 TO 13)
While the negative proposition that "no agreement which is not a contract
shall be enforced in specie" is true, its converse that "all contracts shall be
enforced in specie" is not universally true. 82 The act therefore speaks of
contracts which may be specifically enforced and those which cannot be
specifically enforced (Sections 10-14).
No one is allowed to depart from the contract at his pleasure because as
expressed by Jesse], M.R. "No principle can be more sacred than that a man
shall be compelled to perform his contract". Where persons voluntarily, without
any fraud, accident or mistake, enter into contracts, the jurisdiction of the court
of equity ought to be exercised.83
Where there is a concluded and complete contract) W Where it is in writing,
fair and certain, where it is upon adequate consideration and capable of being
enforced and where its nature is such as requires enforcement in specie, 85 the
contract would be enforced. Specific performance is thus a conscience attempt
on the part of the court to do complete justice between the parties with regard to
all the juridical relations growing out of the contract.
The section for its enforcement requires fulfilment of the following
conditions:
(a) the suit must relate to specific performance of a contract;
(b) it must fall within clause (a) or clause (b) of Section 10;
(c) it must be a fit case for specific performance; and
(d) it should not be barred for specific performance, as per other sections
of this chapter.
82. Bancrjce: Law of Specific Relief, edn. 9, 1992,

pp. 108-109.
83. Leech Y. Scliweder, (1874) 9 Ch App 463; Cf. Davis v. Maung Shwe, 1LR 38 Cal 805 (PC): 13
Born LR 704: Bancrjee: p. 109.
84. S.V.R. Mudal jar v. Rajabu F. Buharj, (1995)4 SCC 15: AIR 1995 SC 1607.
85. induben ANhok- rao Nalvade v. Dhirajlal Shjvjcrj Suran, 1995 Supp. (3) SCC 541.
Sections 10 to 13 explain where specific performance is enforced either in

full or in part, either of a contract or contracts connected with trusts, and in
doing so they explain the very general principles which we have noted before. It
must also be noted that Section 14(3) grants specific performance in six cases.
Section 10.—Section 10 of the Act lays down the following equitable
rules-
(i) that the specific performance of a contract is within the discretion of
the court;
(ii) it will be granted where there exists no standard for ascertaining the
actual damage [Section 10. clause (a)]. As decided in Faicke v.
Gray 86, where a rare China vase or an old and rare manuscript is
agreed to be sold, there is no standard for ascertaining the actual
damage that would be caused by its non-performance and therefore
the contract will be specifically enforced. As is the case with a China
vase (a movable property) so is the case with land or a house or shares
of a particular company or construction of a building, 87 but the goods
or chattel must have a particular value or association, or some
antiquity, unusual beauty, variety and distinction attached to it from
the buyer's viewpoint. As Story 8 writes the grounds of such a rule is
utter-uncertainty of any calculation of damages as they must, in such
a case, be, in a great measure conjectural- Thus all contracts
concerning unique and precious articles, heirlooms, or paintings, old
furniture and the like, in which there are no details to furnish a
criterion nor any other means of estimating the pretium affectionis
which constitutes the real value to the owner, and which is beyond the
competency of the court to decide, writes Pomeroy 89 may be
specifically enforced. The leading cases on this point are Pusey v.
Pusey9° and Duke of Somerset v. Cooxson91.
as clause (b) of Section 10 provides, specific relief will also be
granted where compensation i s not an adc.quuzc ciicf,
(iv) as is further provided by the explanation, the court in such cases will
presume that unless and until the contrary is proved in case of sale of
immovable property, compensation is not an adequate relief;
(v) in case of movable property, compensation is an adequate relief
[Explanation (ii)];
(vi) But in the following cases the court presumes that compensation is not
an adequate relief and hence specific performance will be granted-
86. (1859) 4 Drew 651: 62 ER 250.

87. Storer v. Great Western Rly. Co., (1842) 2 Y & C Ch Cas 48: 63 ER 21.
88. Story: Equity, S. 722(a).
89. Pomeroy, Sp. Cs 34, p. 101: Cited in Banerjee: Law of Specific Relief, edn. 9, 1992, at pp.
115, 116.
90. (1864) 1 Vcr 273 (a horn with inscription thereon).
91. (1935) 3 P wms 390 (a thing of antiquity and curiosity).
(a) where the movable property is not an ordinary article of

commerce, or
(h) is of special value or interest to the plaintiff, or
(c) it consists of goods not easily available in the market
[Explanation (ii)(a), or]
(d) where the defendant holds the property as the agent or trustee of
the plaintiff [Explanation (ii) (b)j
In Cohen v. Roche92 , the plaintiff failed to recover in specie certain antique
furniture though it was of some beauty and distinction because he was merely a
dealer who had bought it for resale. Similarly, any stock for which there is a
regular market is not a proper subject for specific performance.93
Section 11.—Section 11 provides for cases in which specific performance
of contracts connected with trusts are enforceable. For this purpose it may be
said that—(z) to grant specific performance of such contracts rests solely within
the discretion of the court as the word "may" suggests [Section 11(1)]. No
specific performance is granted where (ii) a trustee contracts in excess of his
powers or (iii) in breach of a trust [Section 11(2)]. Behind this lies the simple
reason that a court will not aid the use of excess powers of a trustee nor aid his
breach of trust by granting specific performance of a contract connected with
trust.
For example, A is a trustee of land with powers to lease it for seven years.
He contracts with B to lease the land for 7 years and to renew the contract after
its expiry. This contract cannot be specifically enforced as it is in excess of A's
powers as a trustee. 94 Thus a trustee selling trust property at a price below its
market value and the directors of a company selling property without proper
sanctions, are instances of misuse of trust and excess use of powers. Such
contracts cannot be specifically enforced.
Section 12.—This section is in relation to specific performance of a part of
contract. It explains that (i) specific performance of a part of contract shall not
be granted [Section 12(1)]. (ii) Where a part of contract cannot be specifically
performed but its non-performance admits of compensation and the part left
unperformed is of mall value, the court will allow specific performance of so
much of the contract as can be performed and will allow compensation for the
rest [Section 12(2)]. (iii) When a party is unable to perform the whole of his part
of the contract and the part so left unperformed is (a) a considerable one and
admits of compensation, or (b) is such that it does not admit of compensation,
the plaintiff cannot get specific performance.
92. (1927) 1 K 169: 136 LT 219.

93. Tej Singh v. State of UP.. AIR 1981 All 103 (waste coal ash): for contrary opinion see
U.P.
Slate Ele Rd. v. Ram Bara, Pratad, AIR 1985 All 265.
94. Ma/wined Ecmc,t Khan v. Nunda Dulal. 16 IC 390: sec Mortlack v. Buller, (1804) 10 Ves 292:
32 ER 857.
But in cases falling under (a) above, the consideration paid will be abated or
reduced suitably and in cases under (b) above there will be no abatement and the
whole of the consideration must be paid. In both these cases the plaintiff will
have to let go all his claims to performance or for compensation for the part left
unperformed as the case may be [Section 12(3)]. (iv) When a contract consists
of two parts: one, which ought to be performed and the other standing apart and
being independent of the first cannot or ought not to be specifically performed,
the first part must be specifically performed [Section 12(4)]. (v) Ceasing of a
part of the subject-matter of the contract at the date of its performance raises a
presumption in favour of a party that he is unable to perform it [Explanation to
Section 12(4)].
Section 12, as noted by Mulla, constitutes a complete code in respect of a
claim for specific performance of a part of a contract. 95 But here he sounds a
note of caution that in the area of "specific performance with compensation"
English cases would have to be applied with great care. Strong remarks have
been made by eminent English judges on the unfortunate adventures of the
courts of equity in "making bargains for the contracting parties which they
never would have made for themselves".
General principles as to compensation have been ably summed up in
Rutherford case 97 as cited by Mulla. The question for the court is always
whether the contract can be executed in substance. "If a vendor sues and is in a
position to convey substantially what the purchaser has contracted to get, the
Court will decree specific performance with compensation for any small and
immaterial deficiency provided the vendor has not, by misrepresentation or
otherwise, disentitled himself to his remedy. Another possible case arises where
a vendor claims specific performance and the court refuses it unless the
purchaser is willing to consent to a decree on terms that the vendor will make
compensation to the purchaser who agrees to such a decree on condition that he
is compensated. If it is the purchaser who is suing, the court holds him to have
an even larger right. Subject to considerations of hardship he may elect to take
all he can get, and to have a proportionate abatement of the purchase money.
Bui ihis right appiies only to a deficiency in the subject-matter described in the
contract".98
The explanation includes the cases that fall under Section 56 of the Contract
Act.
In case of sale of immovable property by a single owner to several
purchasers, no specific performance can be decreed against the vendor at the
suit of only some of them if others do not join it claiming performance. The
section, therefore, would not apply to such a case.
96 Indian ('mJrrnt At osi€i Specific Relu'[Aet. pp 83334.

*1
90. Re Ar,i4d, Arnold

u v. /irnol(j. (1880) 14 Ch D 270; 42 LT 705, ciLcd in ibid.
97. Rutherford v. Aton-Adams. 1915 AC 866: 113 LT 931 (PC); Arun Prakash v. Tuixi ('haran,
1949 AC 510.
98. Pollock and Mulla: Indian Contract Act and . Specific Relief Act. p. 834.
XXIJfl Specific Performance of Contracts 391
Section 13.—This section provides regarding the rights of a purchaser or

lessee against persons with no title or imperfect title. As the section provides,
where a person contracts to purchase or to obtain a lease of immovable property
from a person who has no title or only an imperfect title to it, he will have the
following rights:
(i) He can compel the vendor or lessor to make good the contract when
he acquires any interest in the property subsequent to the contract
[Section 13(l)(a)].
(ii) He can compel him to procure concurrence or conveyance from the
other person when it is necessary for validating the title and the
persons are bound to concur [Section 13(1)(b)].
(iii) He can compel him to redeem the property and to get a valid
discharge if it is mortgaged and also compel him to make a
conveyance from the mortgagee if necessary [Section I3(l)(c)].
(iv) A purchaser or lessee will have a right to return of his deposit with
interest, to costs of the suit and to a lien for all these three items on
the vendor's Interest or on his property subjected to contract, in case
vendor's or lessee's suit for specific performance is dismissed for
want of his title or imperfect title [Section 13(1)(d)].
(v) The above rules apply to contracts for sale or hire of movable
property.
As is provided, where a party enters into a contract regarding property
which he has no power to dispose of, but subsequently acquires that power, he
can be compelled to perform the contract he entered into.' But the purchaser
cannot afford to remain negligent and the rule of caveat emptor applies to him.2
This section should not be confused with Section 43 of the Transfer of
Property Act. In Silla Chandra Sekharam v. Ramchandra Sahu 3 , the Supreme
Court explained that the expression "subsequently to the sale or lease" in
Section 18 of the old Specific Relief Act (Section 13 here) means subsequently
to the contract to sell or let and not subsequently to the execution of the sale
deed or lease deed. The above expression should preferably be construed in a
way that there are no overlappings between the provisions of clause (a) of
Section 13 and Section 43 of the Transfer of Property Act as the legislature does
not ordinarily intend to make duplicate provisions for similar Situations. Sub-
section (1)(a) is really plain justice." A seller's obligation is determined by what
he has contracted for, and one may bind oneself to sell that which he has not,
but expects to have it in time to perform the promise, taking tJe risk of failure.
There is nothing extraordinary here therefore to compel him at a suitable time to
perform that which he has undertaken to perform.
1. llnlroyd v Martha!!. (1862) tO I ILC 191 Ehsanul /faq v. Mohammad U,nnr, AIR 1973 All
425.
2. Gaur Chandra Das v. Pravanna Kumar Chandra, ILR (1906) 33 Cal 812: 10 Cal WN 788;
Gajapailu Y. tllagia. ILR (1886) 9 Mad 89:9 Ind Jur 419.
3. (1964)7 SCR 858: AIR 1964 SC 1789.
4. Pollock and Mulla: /rirlzan Contract Act and Specific Relief Act. p. 840.
Section 43 of the Transfer of Property Act refers to the sale or lease and
under it property is conveyed first and title is acquired afterwards, whereas
Section 13 refers to the performance of a contract and the vendor is required to
convey the property contracted for, when acquired by him. Thus Section 13
refers to facts during the pendency of a contract.
It must be noted that the main principle is laid down by Section 13(1)(a)
and sub-clauses (b) and (c) declare the consequences of the principle. In so far
as return of deposit is concerned the principles laid down in Howe v. Smith 5 by
Cotton, L.J. apply in India.6 Similarly, where a contract for sale goes off by
default of a purchaser the vendor is entitled to retain the deposit.'
The provisions of sub-section (1) apply to immovable property but they
may be applied to contracts for sale or hire of movable property also, as
provided by sub-section (2).
10. WHAT SHOULD A PLAINTIFF PROVE
As Section 16(c) provides, in a suit for specific performance the plaintiff
has to prove the following things:
(1) That there was a concluded contract between himself and the
defendant. 8 If he cannot prove it, decree for specific performance
cannot be granted.9
(ii) That he has performed or has always been ready and willing to
perform the essential terms of the contract which are to be performed
by him.
(iii) That he is ready and willing to do everything on his part in future too,
i.e., he has to prove his continuous readiness and willingness to
perform the contract as it really was and not as he alleges it to be)°
His readiness and willingness would be inferred from his conduct,
and that is a question of fact in each case)
Readiness to perform according to Fry consists rf () past aLia as well as (b)
future acts incltiri"g aH ciditions precedent, the express and essential terms,
the implied and essential terms and all the representations made on the faith of
which the contract was entered into, but for the non-essential terms or the terms
of a collateral contract no such performance need be shown.
"Aver" and "Prove" are two entirely different words with two different
connotations. "Aver" means to ascertain or to mention something in the plaint,
5. (1884) 27 Ch D 89: 50 LT 573 (CA).

6. Naxesa Aivar v. Appavu Padavachi. ILR (1915) 38 Mad 178:24 Mad U 488: 19 IC 462.
7. Naresh Chandra Guha v. Ram Chandra Samanta, AIR 1952 Cal 93.
8. S.V.R. Mudaliarv. Rajabu F. Buhari,(1995)4 SCC IS: AIR 1995 SC 1607.
9. Ganesh She! v. GSGK Setrv. (1998) 5 SCC 381.
10. Ardeshir Mama v. Flora Sassoon, (1928) 32 CWN 953 (PC); (1928) 55 IA 360: AIR 1928 PC
208.
11, Bindeshri Prasad v. Jairam Gir, ILR (1887)9 All 705 (PC): 14 IA 173; Bank oJlndia Lid, v.
JamseijiA.!!. Chino y , AIR 1950 PC 90:77 IA 76.
while "prove" connotes that what has been asserted in the plaint has to be
proved by presenting evidence. As expressed in Paithur H. Saheb case, 12 it is
therefore imperative on the part of the plaintiff to aver in the plaint that he has
performed his part or that he has been always ready and willing to perform the
essential terms of the contract which are to be performed by him. In judging this
readiness and willingness the Court has to look to the totality of circumstances,
a literal compliance with the terms is not imperative, nor it is a requirement of
law) 3 The plaintiff in such cases may be directed suitably so that interest of
both the parties are safeguarded) 4 However the performance of the essential
terms must be full and not of a part only. 15 A plaintiff failing to fulfil any of the
two obligations enjoined by the law will not be allowed to succeed. 16 This is
because "he who seeks equity, must do equity". The Court has no power to
relax this rule. The burden of proving readiness and willingness up to the date of
trial lies on the plaintiff: 17 it is his duty. There is no particular form prescribed
for expressing readiness and willingness. 18 The plaint in this respect should not
be construed in a pedantic manner in order to non-suit the plaintiff. 19 The
averment of the plaintiff's readiness and willingness, if it is not initially made
due to counsels mistake, may be allowed to be made later on by amending the
plaint. Such an amendment does not tantamount to adding a new cause of
action; it merely completes the prayer already made.21)
As observed by the Supreme Court of India where a subsequent purchaser
had deemed notice from fact of possession of previous purchaser, he would be
deemed to be a non-bonafide purchaser with notice, and consequently specific
performance of sale agreement of previous purchaser was decreed. 2 ' Where
there are clear recitals in an agreement of sale of whole building the same
cannot be whittled down by inaccuracy in the recitals. 22 In case where there was
an agreement to sell share of a joint holder of property, the submission that the
property will have to be partitioned or that it was scattered at different places
was held not to be a legal difficulty. 23 Performance of contract in a "reasonable
time" is a question of fact in each case. 24 Finally to grant specific performance
or not is a question depending upon facts and circumstances of a case. Where a
12. P.H. Saheb v. Bapanna Annapunianvna, AIR 1986 Kar 109.

13. Mithuithan v. Pipariawali, AIR 1986 MR 39, relying on AIR 1971 SC 1238.
14. C.L Join v. Gapi Chand, AIR 1990 Del 380.
15. Byomkesh Boner) ec v. Nani Gopal Banik, AIR 1987 Cal 92.
16. Jagannath Misra v. Uniar Misra, 1984 (1) Cri U 223; Abdul Khader v. P.K. Sarabai, AIR
1990 SC 692.
17. Sara! Kumar Chauerjee v. Madhusudan, AIR 1964 Cal 556.
18. K. Sambasiva Rao v. P. Bangaru Raju, AIR 1985 AR 392.
19. Naval Kjxhore v. Ku/chwarj Den, 1986 BU 268: (1986)34 BUR 418,
20. Gajanan, J. Jar/ti v. P.M. Kaiwar, (1990) 1 BU 650; Oscar Lavis v. Sarodh, (1990)1 KLT
469; Joga Singh V. Pakhar Rain, AIR 1990 P & H 314.
21. Ram Vi!a.c 0)/ta v. Bishwtj Muni, (1979) I SCC 21: AIR 1998 SC 1094; Govinddas v.
Shantibai. (1973) 3 SCC 418: AIR 1972 SC 1520.
22. Jndubt'it Ashokrao Na/rode v. Dhirajial Shi vial Surati, 1995 Supp (3) SCC 541.
23. Kartar Singh v. Harjinder Singh, (1990) 3 SCC 517: AIR 1990 SC 854.
24. Hungerford Investment Trust Ltd. v. Hondas Mundhra, (1992) 3 SCC 684: AIR 1992 SC
1826: (1972)3 SCR 690.
394 Equity, Trusts and Specific Relief [Chap-
plaintiff in seeking specific performance obtains an unfair advantage over the

defendant, the same would not be granted by the court.25
11. CONTRACTS WHICH CANNOT BE SPECIFICALLY ENFORCED
General.—As discussed before, where pecuniary compensation was not an
adequate relief specific performance was decreed. Looking at the proposition
the other way, it could be said that if compensation is an adequate relief,
specific performance will not be decreed. But this is not all and it is not so
simple as to close the discussion, because there are situations wherein, on the
general principles, specific performance should have been granted by the
Chancery Courts in England even though they have declined to grant it. Those
cases have been grouped by Sne11 26 under the following headings:
(i) Illegal or immoral contracts
(ii) Agreements without consideration
(iii) Contracts for transient interests
(iv) Contracts involving personal skill
(v) Contracts requiring personal supervision
(vi) Contracts to transfer goodwill alone
(vii) Divisible contracts
(viii) Contracts for arbitration
(ix) Contracts wanting in mutuality
(x) Contracts to exercise a testamentary power of disposition.
Section 14 of the Specific Relief Act when viewed with Sections 11.12 and
13 enlists the contracts which cannot be specifically enforced, as under:
(i) Contracts where compensation is an adequate relief [Section 14(l)(a)]
(ii) Contracts running into minute or numerous details [Section 14(l)(b)]
(iii) Contracts dependent upon personal qualifications [Section 14(1)(b)]
(v) Cutuzacts dependent upon volition of the parties [Section 14(l)(b)1
(v) Contracts which from their very nature are such that they cannot be
specifically enforced [Section 14(1) (b)]
(vi) Contracts in their nature determinable [Section 14(1)(c)]27
(vii) Contracts requiring continuous supervision of the court [Section
14(l)(d)]
(viii) Agreements to refer to arbitration [Section 14(2)]
(ix) Agreements to lend money or to mortgage [Section 14(3)(a)I1
25. Sandh y a Rani Sarkar v. Sudha Rani Devi, (1978) 2 SCC 116: AIR 1978 SC 537: B.R. Mulani
v.A.B. AswathaNarayan(Dr), 1993 Supp (4) SCC 743: AIR 1993 SC 1318.
26. SnelI's Principles of Equity, pp. 578, 583.
27. Indian Oil Corpn. Lid. v. Arnrilsar Gas Service, (1991) 1 SCC 533.
(x) Agreements to form partnership [Section 14(3)(b)1

(xi) Contracts to build or repair [Section 14(3) (c)]
(xii) Contracts made by trustees in excess of their powers [Section 11(2)]
(xiii) A part of contract cannot be specifically enforced [Section 12(1)]
(xiv) A contract whose material part of the subject-matter has ceased to
exist [Section 13(4) explanation].
Equity will not compel the specific performance of an illegal contract in
England even though it is legal in the country of its origin, e.g., agreement
between husband and wife for future separation. An agreement for immediate
separation was once believed to be contrary to the policy of law but now it is not
so and will be enforced if it was by way of matrimonial or other proceedings.
Section 9 of the Specific Relief Act, 1963 provides this by way of defence
available to a party under any law relating to contracts. With the legality of
contract are connected the questions regarding consideration, consent, capacity,
legality of the object and formalities, but since they are peculiar to the Contract
Act we must leave them. It would therefore suffice to say that a contract entered
into by a minor misrepresenting his age 28 , a contract entered into by a trustee
that necessitates a breach of trust 29 , are contracts the specific performance
whereof would not be granted as they are not valid at law. Similarly, agreements
without consideration will not be enforced. Agreements for transient interests or
interests which are not lasting or enduring will not be specifically enforced.
Where there is no concluded contract, its specific performance cannot be
granted.-10
(a) Contracts involving personal skill—There is a limit to courts' power in
granting specific performance and it is discernible in case of contracts to do acts
involving personal skill, knowledge, inclination and qualification. Courts cannot
control the mind and the ideas of an individual. Their scope becomes limited
here. In Lumley v. Wagner31 , a singer agreed with a theatrical manager to sing at
his theatre for a particular period. In a suit for specific performance against her
the court could not compel her to sing as it depended on personal inclination,
but it must be noted that she was enjoined from singing elsewhere. As noted by
Snell32 , the threat of committal might induce her to perform but the court could
not control imperfections of performance or judge whether they were natural or
self-induced. 33 It is for such reasons that a contract to report cases for a series of
law reports 34 , or an infant's apprenticeship deed, are not specifically enforced. It
is true that in such cases of breach, money compensation is wholly inadequate,
the real ground behind it being the inability of the court in executing its decree.
28. Aju4hia Prasad v, Chandan La!, AIR 1937 All 610.

29. Will,no:t v. Barber, 1880 15 Ch D 96: 43 LT 95 (CA).
30. Ganesh She: v. GSGK Seay, (1998) 5 SCC 381,
31. (1852) 1 Dc GM & G 604:42 ER 687,
32. Snell's Principles of Equity, p. 580.
33. C.H. Giles and Co. Ltd. v, Morris. 1972 I WLR 307:
(1972) I All ER 960 (Ch D).
34. Clarke v. Pr ice, 0819) 2 Wits Ch 157:37 ER 270.
396
In the words of Professor Langdcll, if a contract consists in giving, equity can

enforce a specific reparation of a breach of it, but if it consists in doing
something, it cannot enforce it. Similarly, a contract of employment by or
against an employer 35 , or a contract of personal service 36 cannot be specifically
enforced. The cases of Vaish Degree College v. Laxminarayan 37 and the
Ka y astha Pathshala. Allahabad 38 reiterate the same principle. In the first case it
was held that a cowl would not normally give a declaration that the contract
subsists 'and the employee even after having been removed from service can be
deemed to be in service against the will of the employer. Of course, this rule is
subject to three exceptions. In the second case 39 the employee, a teacher in
educational institution taught for one or two years. He was afterwards
suspended and was out of teaching job for about 25 years. The Supreme Court
held that his reinstatement is not justifiable and salary of three years as damages
would suffice. In educational institutions, the court cannot focus only on the
individual forgetting all else. The court must have regard to varying
circumstances in the academic atmosphere and radically changed position of the
individual sought to be reinstated. Specific enforcement and reinstatement in
service in such cases are rarely made because to do so, in the words of Dr.
I-Ianbury 10 , would be difficult if the defendant proves recalcitrant, and it is
contrary to public policy to compel one person to submit to the orders of
another. The courts, said Fry, L.J. in Dc. Francesco case41 , "are bound to be
jealous, lest they should turn contracts of service into contracts of slavery".
Conversely, equity will not compel an employer to keep a servant. The proper
and exclusive remedy for wrongful dismissal is an action for damages. 42 Under
this heading may he included the cases of personal scrvice 43 , contract of
employment, contracts to marry, to paint a picture, to sing, to report cases, or to
write a book.
As observed in Jirendra Nath case 44 a contract of employment for personal
service cannot be enforced specifically, and more so when the services are of
35. Calcutta Chemical Co. Ltd. v. D.K. Barman, AIR 1969 Pat 371.
BooI Ghand (Dr.) v. Chancellor
36. Dr. S. DuO V. University of Delhi, AIR 1958 SC 1050;
Kuruk.vhetra University, AIR 1968 SC 292: (1968) 1 SCR 434: 68 PunJ LR 1031: (1968) 2
(1972) I
LU 135; Vidy a Ram Mishrn v. Managing Committee, Shri Jai Narayan College.
SCC 623: AIR 1972 SC 1450 (College & its teacher); S.R. Tewari v. District Board, Agra,
AIR 1964 SC 1680: (1964) 3 SCR 55 (action can be declared ultra vires).
37. AIR 1975 SC 888.
38. The Kayastha Pathshala, Allahabad v. Rajendra Pra3ad and State of U.P. v. Rajendra
Prasad, AIR 1990 SC 415.
39. AIR 1990 SC 415.
40. Hanbury: Modern Equity. p. 45.
41. De Francesco v. Barnum (No.2). (1890) 45 Ch D 430:63 LT. 438.
AIR 1968 SC 292: (1968) 1 SR
42. Bool Chand (Dr) v. Chancellor Kurukshetra Universit y,
(1991) 3 SCC 54: AIR 1991 SC
434; Nandganj Sihori Sugar Factory Ltd. v. Badri Nath Dixit.
1525.
J,rendra Nath v. Empire of
43 Steel Industries Kerala Ltd. v. S.M. Rebello. (1985) 2 SCC 363:
India and Ceylon Tea Co.. AIR 1990 SC 255. -
44. AIR L990 SC 255.
XXIIII Specific Performance of Contracts 397
trust and confidence .45 Similarly contracts for the purposes of pleasure, for
pursuit of science or for the purpose of charity, contracts wherein an employee
is demoted or wherein he is dismissed from Zilla Parishad Service,-" no specific
enforcement is possible; the proper remedy for the plaintiff being to seek
damages. 18 A party to an illegal contract cannot enforce his rights thereunder .49
Statutory Servants
However whenever a Court is satisfied that a departure from this principle
is desirable and called for it will grant a declaration that the employers action in
determining the employee's services is illegal and ultra vires. 50 This will compel
the employer to reinstate or re-employ the servant. Thus to this general rule that
there can be no specific enforcement of a contract of employment for personal
service, the following are the exceptions which impels the court to grant specific
performance of a contract—
(a) a public servant dismissed from service in contravention of Article
311 of the Constitution;
(b) a dismissed worker under Industrial Law or by Labour or Industrial
Tribunal: and
(c) when a statutory body acts in breach of a mandatory obligation
imposed by statute.5'
In such cases the Court may grant an injunction and further compel the
employer to reinstate the employee. Such an order is made because there is a
breach of statutory obligation on the part of the employer. However no such
relief can be claimed against a non-statutory body.52
In case of Government servants the only relief would be by way of appeal
to superior officers. They cannot get injunction in their favour but may claim
damages for the actual loss caused to them by the dismissal.53
(b) Contracts involving personal supervision.—Such contracts require
continuous, constant and possibly ineffective, supervision of successive acts by
the çourt.54 As noted by Snell, equity will not enforce an award for repair of a
railway involving continuous supply of engine power, a term in a lease to
employ a resident porter and an agreement to publish an article which has not
45. Madan v. Karnaldhari, AIR 1930 Pat 121: 127 IC 281.

46. Rigby v. Connol, (1880) 14 Ch D 482.
47. ZiIla Pan shad. Gorakhpur v. Rarnanuj Sahai, 1986 Lab IC 319
48. Vtdya Ram Mihra v. Managing Committee Shri Jai Narain College. (1972) 1 SCC 623: AIR
1972 SC 1450.
49. FTC Ltd. v. George Joseph Fernandes. (1989)2 SCC I: AIR 1989 Sc 839.
50. S.R. Tewari v. District Board, Agra, AIR 1964 SC 1680: (1964) 3 SCR 55; Sirsi Municipality
v. Cecelia Kom Francis Tellis, (1973) I SCC 409: 1973 SCC (L&S) 207: AIR 1973 SC 855.
51. Indian Air Lines v. Sukh Deo Rai, (1971) 2 SCC 192: AIR 1971 SC 1828. Executive
Committee of Vaish Degree College v. Lo.xmi Nara yan. AIR 1976 SC 888; for details see
Banerjce S.C.: Law of Specific Relief, Ch II, E4n.9. 1992, pp. 194-198.
52. Agarwal Digambar v. B.P. Shrivastava, 1984 Lab IC 2591 (AU) (DB).
53. I)ahyalal Bapubhac v. Patna Municipality , ILR 1967 Pat 182: (1967) 8 GLR 167.
54. C.!!. Giles and Co. I.M.Y. Morris. (1972) 1 WLR 307: (1972) 1 All ER 960 (Ch. D).
reached its final form. "In such cases, equity's view is that of a wise parent
dealing with his children; it is best not to issue orders unless you can be
absolutely sure of effecting compliance."55
Under this heading fall the cases of agreements to build or repair. Ryan v.
Mutual Tontine Westminster Chambers Association is a leading case on the
point, wherein the court refused to grant specific performance of an agreement
to employ a resident porter who should be in constant attendance and perform
certain specified duties. Similarly, an agreement to provide a housekeeper", or
the obligation of a shipowner under a charter party 58, or a contract to deliver
goods by instalments59, cannot be specifically enforced. Difficulty of
supervision is also experienced in building contracts and contracts to keep
buildings in repair. Still, however, in suitable cases 60 specific performance
would be decreed. Para 3(c) of Section 14 deals with building contracts which
can be specifically enforced. It is based on the English rule expressed in
Wolverhampton Corporation v. Emmons6l which says that the court will order
specific performance of an agreement if (1) the building work is sufficiently
defined by the contract; (ii) the plaintiff has a substantial interest in the
performance of the contract so that damages would not compensate him, and
(iii) the defendant is in possession of the land so that the plaintiff cannot employ
another person to build without committing a trespass. 62 A writer cannot get
specific performance of his contract but he will be entitled to damages for loss
of opportunity to enhance his reputation.63
(c) Contracts to transfer goodwill alone.—"Sale of the goodwill of a
business unconnected with the business premises cannot be transferred because
of the uncertainty of the subject matter and the consequent incapacity of the
court to give specific directions as to what is to be done to transfer it." In Baxter
v. Conolly'4 and Darbey v. Whitake,45 this was the law declared, but in Beswick
v. Bes-wick66 specific performance for the sale of goodwill without business
premises at the suit of the personal representatives of a vendor who had
performed his part of the contract, was ordered. This trend must be noted.
(d' fliv,cih! Ccr.r,c:s.—If a toniract is divisible into two or more
independent parts or if some of its terms are legal and the rest are illegal and
55. Hanbury: Modern Equity, p. 45.

56. (1893) 1 Ch 116: 67 LT 820 (CA).
57. Barnes v. City of London Real Property Co. ew.,(1918)2Ch 18: 119 LT 293.
58, Lie Manor v. Gibson. (1858)4 Dc & 1276: 45 ER 108.
59. Dominion Coal Co. Lid. v. Dominion Iron and Steel Co. Lid, 1909 AC 293: 100 LT 245 (PC).
60. A.G. (at the relation of Allen) V. Colchester Corporation, (1955) 2 QB 207: (1955) 2 All ER
124 (QBD). See also Chitty on Contracts, 23rd Edo., pan 1530.
61. (1901)1 KB 515:84 LT 407 (CA).
62. Snells Principles of Equity, p. 581.
63. Joseph v. National Magazine Co. Lid., (1958)4 All ER 52 (Ch D).
64. (1820)1 Jac & W 576: 37 ER 487.
65. (1857)4 Drew 134:62 ER 52.
66. 1968 AC 58: (1967)3 WLR 932: (1967)2 All ER 1197 (HL).
they can be severed, effect can be given to those independent parts, or the tern-is
which are legal can be specifically enforced.
(e) Contracts for arbitration.—As Snell notes, "equity will not directly
enforce an agreement to appoint an arbitrator 67 but the court may indirectly
compel performance of the agreement by staying an action which is brought, if
the defendant so applies". In India too, the existence of such an agreement bars
a suit for specific performance as is provided by sub-section (2) of Section 14.
The bar applies equally to the institution as well as the further prosecution of the
suit. 68 For such a bar to exist the plaintiff must have refused to refer the
Controversy to arbitration and this has to be proved, it cannot be simply inferred
by mere filing of the plaint. 6 The simple reason behind putting the bar is to
prevent people from breaking their promises to refer to arbitration and thus to
achieve the result desired. As Pollock and Mulla have expressed, 70 "the
procedure for enforcing an award was only under Section 14 of the (Specific
Relief) Act" and this view has received statutory force by virtue of an
amendment of Section 32 of the Arbitration Act, 1940 contained in Section 43
of the Specific Relief Act, 1963.
(f) Contracts wanting in mutuality.—As per CardOzo, J., mutuality is
important only to secure that the decree will operate without injustice to either
party. 71 A contract, to be specifically enforceable, must at the time when it is
made, be mutually binding. In Forrer v. Nash 72 ,
it was decided that if a vendor
has no title to the estate which he has contracted to sell and has no right to
compel the real owner to convey it, he cannot force the purchaser to take a
conveyance from the true owner, even if he is willing to convey the property,
for the purchaser has no right to compel a conveyance by the true owner. Thus
mutuality implies that the specific performance of a contract should be such as
can be claimed by or granted to both the parties to the contract. Mutuality does
not mean equality and exact arithmetical c orrespondence. It means that each
party must have the freedom to enforce ri g hts under the contract against the
other. 73 In Mir Sarwarjan case74
the Privy Council decided that no specific
performance could be granted in a contract which can be enforced at the option
of only one of the parties, but Section 20(4) of the Specific Relief Act provides
that it cannot be so refused merely on the ground that the contract is not
enforceable at the instance of the other party. The controversy regarding
introduction and application of the doctrine of mutuality which existed in India
between various High Courts has been put at rest now by introducing Section
20(4) in the Specific Relief Act, 1963.
67. Re Smith & Service & Nelson & Sons, (1890) 25 QBD 545: 63 LT 475 (CA).
68. Shiblal v. Hiralal, (1888) AWN 133.
69. Koontud Chu'idér Dass v. Chunder Kant Mookerjee, ILR (1880)
5 Cal 498: 5 Cal LR 284.
70. Indian Contract Act and Specific Relief Act, p. 850.
71. Cited in Snell's Principles of Equit y , 582.
p.
72. (1865)35 Beav 167: 55 ER 858.
73. Daarath Gaven v. Sarvanara van Ghosh, AIR 1963 Cal 325.
74. Mir SarvarJtin v. 1'akhruddzn Mahomed Chawdhurj,
13 IC 33!. (1912) 39 IA 1: ILR (1912) 39 Cal 232:
Specific Relief [Chap.
400 Equity, Trusts and
of
(g) Contracts to exercise a testamentary power of appointment—Courts
equity will not compel a donee of such a power to exercise it, even if it was for
value. According to equity, to do so would amount to defeating the donor's
intention.
proposition
(h) Contracts where compensation is adequate relief—This
has been discussed in the previous chapter. Stating the gist succinctly, we may
say that in case of contracts of ordinary marketable things, since the same are
available in the market, money compensation is sufficient here. But in respect of
other articles which cannot be so obtained because there is no market for the
same, specific performance is a proper remedy.75
mortgage.—Equity refuses specific
(i) Agreements to lend money or to
performance of such agreements because compensation is adequate relief here.
But where it is not so, i.e., in exceptional circumstances, an agreement to
execute a mortgage would be specifically enforced. As decided in
Meenakshisundara Mudaliar v. Rathnasami Pi11ai 76, where a loan has been
advanced and the borrower does not execute a mortgage or where a part of the
loan is advanced and the lender is willing to perform his part by granting the
remaining part of the loan, specific performance of the contract to mortgage
would be decreed against the defendant borrower. If the borrower is not willing
to repay the loan at once the same result would follow. 77 Section 14(3)(a)
explains this.
(1) Agreements to form partnership.—According to Section 14(3)(b),
where only a formal deed of partnership is to be executed, the parties having
commenced to carry on business of partnership, or where the suit is for the
purchase of the share of a partner in a firm, there would be no objection in
decreeing specific performance; otherwise the court does not decree specific
performance of an agreement to form and carry on partnership.
(k) Vague contracts.—Contrac ts which are so vague in language 78 that
their terms cannot be known or fixed definitely, cannot be enforced specifically,
e.g., a contract to sell at a fair price or to let out at a fair rent is vague, unclear,
indefinite and incomplete for specitic enforcemeuL [Secüoii 14(IXb)].
and B
(1) Contracts in their nature determinable.—Likewise, where A
enter into a partnership at will and no duration of the same is specified such a
contract cannot be specifically enforced because A and B might at once dissolve
partnership. 79 It may be otherwise if the partnership is for a definite, or a fixed
and defined term.
In a case where the assurance was given by the Food Corporation of India,
in writing that it would take the plinths to be constructed by owners of land on
lease for a period of three years, the owners invested huge amounts for
AIR 1950 PC 90: 77 IA 76.

75. Bank of India v. Jarashedji A. H. Chinoy,
76. ILR(1918)41 Mad 959:491C291:AIR 1919 Mad 322.
77. Jew.'an La! Daga v. !'I1mani Chaudhuri, AIR 1928 PC 80: 55 IA 107.
78. Savage v. Uwechia, (1961)1 WLR 455: (1961) I All ER 830 (PC).
79. Scott v. Rayment. (1868) LR 7 Eq 112: 19 LT 481.
construction of plinths. The FCI errnnated the Contract of lease. The Supreme
Court observed that though the contract was aot against p'ablic policy, or
prohibited by any statutory provision of law or ultra vires and the FCI was
hound to discharge its obligations on the principle of promissory estoppel (being
a statutory corporation), the respondent was entitled to damages as the specific
performance of the contract was not possible due to expiry of the period of three
ycars. 8 ° It is evident thii such contracts are in their nature determinable. Section
14(1) (c) expresses this idea. The word volition used in Section 14(1)(h)
connotas the volition of the parties to a contract and none else. The remaining
types of contracts as enumerated earlier have been discussed before.
In Rajasara case specific performance of a contract, to sell agricultural land
with an imperfect title was allowed when the title was perfected. 81 Similarly in
one case an old lessee did not exercise option for renewal and during pendency
of the eviction proceedings, the old lessee with full knowledge of the new lease
continued in possession. Held, the third part y is entitled to possession under the
new lease.82
12. PARTIES TO AN ACTION FOR SPECIFIC PERFORMANCE

(SECTIONS 15, 16,17 AND 19)
Section 15 lays down a list of the kinds of partL— tesides the actual
contractors who are entitled to sue on a contract. Mulla, citing Whitley Stokes.83
agrees with him that no reason appears why sub-section (c) should not have
extended t. all compromises of doubtful claims. The enforcement of rc';trictive
covenants iy way of inji' ion does not come vithin thiS Section Section 19
can be said to be a coun .art of Section 1.' s it e:iimerates the classes of
possible defendants who were not original , artics to the contract. Stated
succinctly, a suit for specific performance of a contract can be maintained by
and against-
(i) the parties to the contract and
(ii) their representatives in interest,
(a) For whcmi conrracj ,nav be specifically enforced [Section 15].—
Section 15 enumerates possible plaintiffs, and consequently specific
performance of ;i contract may be enforced in favour of-
(i) a part y thereto
(ii) representatives in interest or the principal thereto
(iii) Any person hencficrally entitled
(iv) the reniajnderrrian
(t') a recrsioner in possession
SO. rd ('r,rJhrOt(Ofl o f/nf,a fliiopa/ & V Mt. fla/i(af /tgarwil AIR 1996 MP 23
Si - /6'jara Ranijabhi: /)a/,wjbha, V. icun ,-Vczro(tanj/j L4ZIIUIJ/Ufl
SC 1912. (I 966) 3 SCC 300 AIR 1986
82. 1/V. Rajan v. C.N Gopal, (l97 c )4 SCC 302: AIR 975 S(-
26 1.
83. Pollock & Malta: Indian Conrrccr Act and Specific ReO'f,
Ac:, p 851
(vi) a reversioner in remainder

(vii) the amalgamated company
(viii) the company.
Representative-in-interest includes assignee of right to repurchase the
property. 94 Where the right to reconveyance of property is not a personal right
or where there is no express or implied prohibition for its assignment to third
party, its specific performance can be obtained by the assignee. 85
As the general rule goes a contract cannot be enforced except by a party
thereto. This rule has however the following exceptions:86
Where-
(i) a trust is created in favour of a stranger by the contract:
(ii) the promisor constitutes himself as agent for the stranger:
(iii) it is so provided by a marriage settlement;87
(iv) the contract itself provides for maintenance;
(v) the contract itself provides for marriage expenses;
(vi) the aim of the contract itself is to benefit a stranger;
(vii) a charge is created in favour of a stranger by the contract;
(viii) there is established a privity of contract between the promisor and the
stranger;
(ix) it would be conducive to justice to allow a stranger to enforce a
contract: and
(x) the promisor is bound to the stranger on the principle of estoppel.
(b) For whom specific performance cannot be enforced [Section 171.—(1)
One who would not recover compensation for its breach [Section 16(a)].
(ii) One who becomes incapable of performing or violates any essential
term of the contract that on his part remains to be performed, e.g., insolvency
L"
(iii) One who acts in fraud of the contract, or wilfully acts at variance with
or in subversion of relations intended to be established by the contract [Section
16(b)]
(iv) One who is not ready and willing to perform his part of the contract
[Section 16(c)].
(v) One (a vendor or lessor of movable or immovable property) who
knowing himself not to have any title to the property, has contracted to sell or
let the same" [Section 17(a)].
84. TM. Balkrishna Mudaliar v. M. Satyanarayana Rao, (1993) 2 SCC 740: AIR 1993 SC 2449.
85. Habiba Khatoon v. Ubaidul Huq, (1997) 7 SCC 452: AIR 1997 SC 3236.
86. Safiur. Rehman v. Maherunnissa, ILR 24 Cal 832.
87. Nawab Khwaja Mohd. v. Husaini Beg um, 7 II 871.
88. Imperial Ice Manufacturing Co. v. Munchershaw Barjorji Wadia, ILR (1889) 13 Born 415.
(vi) One who cannot give the purchaser or lessee a title free from reasonable
doubt [Section 17(b)].
(vii) One who has, previous to such sale or letting, made a settlement of the
subject matter of the contract [Section 16-17].
There are two conditions precedent as held in Bansidhardas v. Duryodhan
Majhi', to the enforcement of specific performance of a contract and they are
that (i) one must have either performed or (ii) one has been always ready and
willing to perform his part of the contract. This requirement is mandatory.2
Moreover, as the section makes it clear one must assert so or state so in the
plaint and must lead evidence to prove his averment.3
Readiness means capacity of the plaintiff including his financial ability to
pay the purchase price. The continuous readiness and willingness on the part of
the plaintiff is a condition precedent to grant relief of specific performance.
Right from the date of the execution till date of the decree he must prove that he
is ready and has always been willing to perform his part of the contract. This
can be proved from the attendant circumstances.4
In determining the question as to which party is not ready and willing to
perform his part of the contract the court must examine the oosition of both the
parties. 5 Because the bank pass book is not produced, it cannot be presumed thit
the purchaser has no capacity to pay. 6 Similarly instead of cash payment,
presentment of a bank draft would amount to a legal tender.7
One must note that readiness and willingness must be continuous. It is a
condition precedent. It must exist right from the date of the execution till the
date of the decree. If it is not so, specific performance would not be granted. It
is only the vendor-defendant that can raise the plea that the plaintiff was not
ready and willing to perform his part of the contract. 9 Moreover the performance
of the contract must be within a reasonable time where its terms so require, 10
There is no bar for decree for specific performance of a contract of a sale
under Section 16 and a suit should be filed for the same within the period
stipulated under Article 54 of Limitation Act, 1963 . 1 1 Time is always the
essence of the contract for reconveyance of the property. 12
1. (1985)59Cm LT 44 (DB).
2. Anant Prasad v. J.S. Sahai. 1986 BU 164; G. PilIai v. P. Nadar, AIR 1967 SC 868.
3. Sukhbir Singh v. Brijpal Singh, (1997) 2SCC 200: AIR 1996 SC 2510.
4. N. P. Thirugnanam v. R. Jagan Mohan Rao (Dr.), (1995) 5 scc 115; Acharya Swami Ganesh
t.)assji v. Sitaram Thapar. (1996) 4 SCC 526: AIR 1996 Sc 2095; Indira Kaur v. Shiv La!
Kapoor, (1988)2SCC 488: AIR 1988 SC 1074.
5. Indira Kaur v. Shiv La! Kapoor,(1988) 2 SCC 488: AIR 1988 SC 1074.
6. !ibi Jaibunniha v. Jagdish Pandit, (1997) 4 SCC 481.
7. So/ian Singh v. Sarvan Singh. (1996)5 SCC 759
8. N. P. Thirugnanam v. R. Jagan Mohan Rao (Dr.), (1995)5 SCC 115.
9. Jugraj Singh v Lab/i Singh, (1995)2 SCC 31: AIR 1995 SC 945.
10. P.R. Deb & Associates v. Sunanda Roy. (1996) 4 SCC 423.
II. Thakamnta Mathew v. M. Azwnathulla K/ian, 1993 Supp. (4) SCC 492: AIR 1993 SC 1120:
(1993)21 ALR 170.
12. Bis,nillaii Begum v. Ra/wnatullah Khan, (1998)2 SCC 226: (1998)2 MU 6 (SC).
404 Equity, Trusts and Speci fic Relief I Chap.
A distinction can be made between "readiness" and "willingness": the

former means the capacity of the plaintiff to perform the contract which includes
his financial position to pay the purchase price; while the latter is to be found
out from his conduct, which has to be properly scrutinized for the purpose.
Readiness and willingness is to be adjudged with reference to the conduct of the
party and the attending circumstances. 13
The plea that the plaintiff was not ready and willing to perform his part of
the contract cannot be availed of by the purchasers from the vendor.'4
It is sufficient for the respondent to establish that they had the capacity to
pay the sale consideration. It is not necessary that they should always carry the
money with them from the date of the suit till the date of the decree)5
The word violates in clause (h) incorporates in it the instances where the
plaintiff acts in fraud, or in contravention of the contract or at variance with it;
however, this clause, as amended, limits the meaning of the word to violation of
an essential term of the contract that on his part remains to be performed.
The following are the cases" wherein it was held that the plaintiff was
proved not to be ready and willing to perform his part of the contract.—
(1) where he had postponing sale from date to date, was short of money
and never fulfilled his offer to pay part of sale transaction) 7 But
money need not be ready where time is not of essence.18
(2) Where in a contract of reconvcyance he pleaded that the transaction
was a mortgage and he was willing to pay the balance after
accounting and the court held it not to be a mortgage. It is obvious
that the plaintiff was not ready and willing to pay the agreed
con side rat i on. '9
(3) Where in a contract of rcconveyance plaintiff sued in forma pauperis
and pleaded that no sale consideration wa payable by them at all and
pleaded willingness to pay the sale consideration as a last
'dr'rntivp 20
(4) Where the plaintiff falsely pleaded payment of consideration and the
court held that no such payment was made. The plaintiff here clearly
never intended to make .ill payment.2'
(5) Where plaintiff was granted time from the date of passing of the
decree of trial court to perform his part of the contract but failed to
13. (1996) 4 SCC 526, Supra; see also (1997) 2 SCC 200 infra.
14. Jugraf Singh v. Laith Sing/i. (1995) 2 SCC 31: AIR 1995 SC 945.
15. Sukhbir Singh v. Brijpal Sing/i. (1997) 2 scc 200.
16. See Bancrjce's (Tagore Law Lectures) Law of Sp. Relief, Edn. 9. 1992, p.249.
17. C/and Rani v. Ka,no! Rani, (1993)! scc 519: AIR 1993 sc 1742.
18 Sohari Singh v Sar,srrn Singh. (1996) 5 SCC 759.
19. !ia.va,i Noorarii v. Mohan Singli, AIR 1974 Born 136.
20. 11arprarap Singh v. S.N.?.1ra, AIR 1980 All 52.
21 //ewa Noth v. Janki Dei, AIR 1978 Pal 190.
XXIIII Specific Perjorrnance of Contracts 405
deposit the required amount within the time allowed or even

thereafter.22
(6) Where under a compromise it was agreed that in the event
contemplating a sale of his share, one co-owner will give first option
to the other co-owner, and when that option was given, the other co-
owner in his reply questioned the very title of the co-owner-plaintiff
giving notice of the option.23
(7) Where there was an agreement specifying period of 6 months within
which plaintiff had to purchase the stamp papers, tender the balance
amount of consideration and require the defendants to execute the sale
deed, total inaction for two years after initial payment of a small
amount as earnest money by the plaintiff would be a circumstance
which would weigh against exercise of discretion for grant of specific
performance of the agreement in favour of the plaintiff.24
Readiness and willingness cannot be treated as a straight jacket formula.
The same is to be found out from facts and circumstances relevant to the
intention and contract of the concerned party.25
As a general proposition of Law, in the case of sale of immovable property
there is no presumption as to time being the essence of the contract. Even if it is
not of the essence of the contract the court may infer that it is to be performed in
a reasonable time if the conditions are evident (i) from the express terms of the
contract, (ii) from the nature of the property and (iii) from the surrounding
circumstances, for example: the object of making the contract.26
In this case of sale of immovable properly the document of sale contained:
"Rs 98,000 only will be paid by the second party to first party within a period of
ten days only". The language thus showed that the amount was to be paid before
September 6, 1971. The defendant did not pay the amount and thus committed a
breach. The word "only" has been used twice over (1) to qualify the amount of
Rs 98,000, and (2) to qualify the period often days. Having qualified the
amount there was no further need to qualify the same unless it be the intention
of the parties to make time as the essence of the contract. Despite notices of the
vendor to perform vendec's part of the stipulated amount. vendee was not
willing to pay the same unless vacant deliver y of possession of part of the
property was given. In view of the express term of the contract coupled with the
conduct of the vendee, held, time was essence of the contract and vendee was
not ready and willing to perform the contract. The High Court was therefore
justified in setting aside decree for specific performance granted by the trial
court.27
22. N.P. Tliirugnannrn v. R. Ja&'in Mo/iwi Rao (Dr), (1995) 5 SCC 115; sec also P.R. Deb &
A.v.ocjate.s v. Sunanda Ro y , (1996) 4 SCC 423.
23 IJhagwnn Rani v. l'rbIiij Rion, 1983 ALJ 637.
24 K. Y,(Iy(I,zom/I,,7 v twratan, (1997) 3 SCC I AIR 1997 SC 175 I
25 Ramesh (/ianilro v, (/lunfl j /(L/, AIR 1971 SC 1238.
26. ('/uzna' Ro,ii v Kunuj( Root. (1993) i SCC 51 9. AIR 1993 SC 1742,
27. Sec also K.S. Vul yonandanj Y. Vrtjrrnwi. (1997)3 SCC 1: AIR 1997 SC 1151.
The ratio of the above case is reiterated by the Supreme Court in Bihi
Jaibunisha 's case.
(c) Persons against whom contracts may be enforced [Section 19].—
Specific performance of a contract may be enforced against—
(1) either party thereto [Section 19(a)]
(ii) a person claiming under him by a title arising subsequently to the
contract, except a transferee for value who paid money in good faith
and without notice of the contract [Section 19 (b)]
(iii) a person claiming under a title, which, though prior to the contract
- and known to the plaintiff, might have been displaced by the
defendant [Section 19(c)]
(iv) the amalgamated company
(v) the company.
13. WHEN CONTRACT CANNOT BE ENFORCED EXCEPT WITH A

VARIATION (SECTION 18)
When a plaintiff sues for specific performance of a contract and the
defendant sets up a defence of variation in the contract under the circumstances
mentioned below, the court will not grant specific performance in favour of the
plaintiff but with a variation so set up by the defendant in the following cases:
(a) When by (i) fraud, (ii) mistake of fact, or (iii) misrepresentation, the
contract is in terms or effect different from what the parties agreed to
or supposed it to be, or
(b) when the contract does not contain all the terms agreed to by the
parties on the basis of which the defendant entered into the contract,
or
(c) where the contract as framed between the parties does not produce the
result calculated to produce, which may be as a result of fraud,
misrepresentation, mistake or misapprehension and thus the object of
the contract is rendered meaningless, or
(d) where the parties have, subsequently to the execution of the contract,
varied its terms.
Under the circumstances, the plaintiff is put to an election, so to say,
between having his Suit dismissed or having the judgment with a variation set
UP. The contract must be in writing and one 29 thing must be noted here that as
laid down in Narain Partor v. Aukhoy Narain 30 , there is a difference between a
28. Bibi Jaibunisha v. Jagdish Pandit, (1997) 4 SCC 481. But see Kedar Nath Dhingra v. Kanwal
Bhati, AIR 1998 P&H 86. (Though time was essence of the contract, the vendor never agitated
it. Court grants time on condition. Plaintiff fails to pay. Court dismisses suit and grants
compensation of Rs 10,000/- to vendor. Court can thus grant consequential order.)
29. Ram.c&oupm v. Gosden, (1812) I Ves & B 165: 35 ER 65: Nrirain Parwr v. Aukhoy Narain,
ILR(1886) 12 Cal 152.
30. 1LR (1886) 12 Cal 152.
XX111J Specific Performance of Contracts 407
plaintiff seeking a specific performance and a defendant resisting it. In such a

case the plaintiff cannot himself adduce oral evidence in order to get specific
performance with a variation, but the defendant can resist it and adduce parol
evidence to show that the contract does not express the real terms of the parties
due to fraud, mistake, etc. Thus oral evidence can be in the latter kind of cases
and not in the former. 31 However, this general principle is subject to some four
exceptions.
It is a basic principle that specific performance must be of a contract in its
entirety and in accordance with the exact and actual terms of the same. But
where the contract does not express the real terms agreed to between the parties
due to some misunderstanding or misdescription, either in respect of the
quantity or quality of the subject matter, it cannot be enforced in its entirety
except with a variation. Equity desires substantial fulfilment of the contract, not
simply a literal one and therefore, where the essence of the contract can be
enforced and performed, non-essential circumstances of little importance can be
neglected and consequently it justifies a part performance of the contract. On the
same principle, specific performance of a contract with a variation is allowed by
the English law. It was once believed that such a sort of relief combines in itself
more than one relief, but on the principle laid down in Craddock Bros. v. Hunt32
and under Section 43 of the Judicature Act, 1925, a court can grant all the reliefs
to a party in one action and the same principle is incorporated in Section 18 of
the Specific Relief Act. In short, we may say that where a contract between the
parties does not express its real intention or the object of the contract is
frustrated due to not expressing it correctly, and in cases where there is a
subsequent variation made to the contract by parties, the court does not treat it
as if a new contract has come into existence replacing the old, but the original
one exists and it can be specifically enforced with variations alleged therein and
proved by the defendant by evidence adduced.
A sues B to compel specific performance of a contract in writing to buy a
dwelling house. B proves that he assumes that the contract included an adjoining
yard, and the contract was so framed as to leave it doubtful whether the yard
was included or not. The court will refuse to enforce the contract, except with
the variation set up by B.33
14. DISCRETION AND POWERS OF THE COURT

(SECTIONS 201024)
That specific performance is a discretionary remedy and that it will be
refused where the enforcement of a contract results in hardship to the defendant
or unfair advantage to the plaintiff has been discussed earlier in this chapter. It's
difficult to define this field of discretion.34
31. Wl1n,n v. Hearn, 2 W & TLC 573.

32. (1923)2 Ch 136: 129 LT 228 (CA).
33. C.Y. Denn y v. Hamcock, (1870) Ch App. :23 LT 686. (where a plan furnished by the seller
was misleading).
34. Sirvanaravnn v. Yellaji Ran, AIR 1965 Sc 1405.
As an important condition one may say that a party desirous of seeking such
relief must come with clean hands; or else specific performance would be
refusea. 35 This relief is discretionary and is not given merely because it is legal but
it is governed by sound judicial principles. The circumstances referred to in sub-
sections (2) to (4) of Section 20 in regard to exercise of discretion for granting a
decree of specific performance are not cxhaustive. 36 The discretion of the court has
to be exercised in accordance with justice, equity and good conscience and
fairness to both the parties. 37 It has to be exercised on sound, reasonable and
judicial principles. Specific performance would not be granted where the court
thinks that doing so, would generate injustice. 38 Of course the use of discretion
depends upon facts and circumstances of each case, 39 where granting of damages
is an adequate relief, the specific performance would be refused.4°
The court has power to refuse this relief. Where specific performance is
used as an instrument of oppression to get an unfair advantage over the other
party.41 where damages are adequate relief,42 where the act of a third party
could be regarded akin to champertous 43 and where the property in question is
not identifiable, the relief of specific performance would be refused.
In Jaibunnisha case 4 the question was about the essence of time. The Court
held that time is not always the essence of the contract, unless the agreement
specifically stipulates and there are special facts and circumstances in support
thereof. But this rule that time is not the essence of the contract in case of sale of
immovable property was evolved at a time when prices and values were stable
and inflation was unknown. This rule is now required to be relaxed, if not
modified, particularly in case of urban immovable properties. It is high time, the
courts do so!
In one case there was an agreement to sell 100 years old building. The
building had six tenants which affected its value. The expert valued the building
between sixty to seventy thousand. An agreement for sale price of Rs 65.000
was executed the court granted the specific performance of the agreement as it
was not inequitable. In other words since the transaction had not given unfair
advantage to the purctiaser, its specific performance was justified.47
35. Lourdu Marl David v. Louis Chinnaya Arogia Swaniy, (1996) 5 SCC 589.
36, Gane.ch Sher v. C.S. G.K. Setty (Dr), (1998) 5 SCC 381.
37. Kanshi Rani v. Onj Prakash Jawal, (1996) 4 SCC 593 Surya Narayan Upadh yava v. Ram
Roop Pander, 1995 Supp (4) SCC 542.
38. Kalluhi! Sridha ran v. Komath Pandyala Prasanna, (1996)6 SCC 218.
39. S. Rangaraju Naidu v. S. Thiauvara K. Karasu, 1995 Supp (2) SCC 680: AIR 1995 SC 1769.
40. Prakash Chandra v. Angadlal, (1979)4 SCC 393: AIR 1979 Sc 1241.
41. Parakunnan Veetill Joseph's Son Mathew v. Neduinbara Kuruv:la'v Son. 1987 Supp SCC
340: AIR 1987 SC 2328.
42. Prakash Chandra v. Angadlal. supra.
43. S. V.R. Mudahar v. Rajabu f fluhari. (1995) 4 SCC 15: AIR 1995 SC 160.
44. Nnhar Singh v. Annak Singh, (1996) 6 SCC 699.
45. fhbi Jaihunnjtiia v. Jagth.v/i Panda. ( 997) 4 SCC 48!
46. K.S. Vidanada'n v Vairavan, (1997) 3 SCC I: AIR 1997 SC 1751.
47. Mann Eduaria A. Gonsinves Me.vquita (dead) b y L.R. v. Shripad Vishnu Kamat Tark.ar, AIR
1998 Bom4l.
For refusal to enforce specific performance factors cumulatively or with

other factors can form the basis [see S. 20(2). Expin. (1) & (2) and sub-sec.
(4)]48
Similarly where there is no concluded contract between the parties, a
decree for specific performance could not be granted .49
We have discussed where the court will grant specific performance or
refuse it, and also where it grams the same only with a variation in the contract.
It may also grant compensation in suitable cases in addition to specific
performance. The section is, however, not exhaustive of all such pleas leading
to dismissal of the suit for specific performance. 50 Section 21 speaks about this.
(a) Compensatory Relief (Sections 21 to 24).—Under Section 21 the
plaintiff may claim and the court may grant a compensatory relief, i.e., the
plaintiff may claim here compensation for breach in addition to or in
substitution of such performance. 51 There may be cases wherein specific
performance is not advisable to be granted but still however the plaintiff must
be awarded compensation for the breach of the contract made by the defendant.
The court will award compensation in such cases.
In Kalyanpur Lime Works Ltd. V. State of Bihar-52, a substantial part of the
lease had already expired and a suit for specific performance was filed. In this
case the Supreme Court refused specific performance for the lessee as it had
only a few months to run and the lease would have expiru by the time the
contract could be specifically performed. The court here awarded compensation
only to the lessee for the seven years he had been denied possession.53
If the court is satisfied that specific performance aught to be granted but
that alone is not sufficient to satisfy the justice of the case, the court will award
compensation also. Suppose A contracts with B to sell him a house for Rs 1000,
the price to be paid and the possession to be given on January 1, 1877. A fails to
perform his part and B brings a suit for specific performance and compensation,
which is decided in his favour on January 1, 1878. The decree may besides
ordering specific performance, award to B compensation for any loss which he
has sustained by A's refusal. This is aptly explained by sub-section (3) of this
section.
For deciding compensation principles laid down in Section 73 of the Indian
Contract Act will apply, but the plaintiff has to claim it. In suitable cases the
court will allow him to amend the plaint for including such a claim. The
explanation added to the section points to the situation wherein there is a
departure from the English law. English law provided that damages cannot be
awarded where specific performance was impossible. But the plain words in the
48. Sen Mukiierje & Co. v. Shr,maij Chhaya Banerjee, AIR 1998 Cal
252.
49. Garaesh SIsei v. C.S. G_ K. .Sefey(Dr). AIR 1998 SC 2216.
50. FaMJfl1QI V. MUAWnaI, AIR 1965 Raj ItS.
51. JadisI, Sáqrè v. Na:hu Sk. (1992) I 5CC 647: AIR 1992 SC 1b04.
52, AIR 1934 SC 165.
53. See aho Fd Corporasi of India v. B411mW Agarwo, AIR 19 MP 23 wheit
awded iyi as the Vwific pecfonnce was Cowl
not pouiblc due to expiry of stipulated
period. For facts see Para 11(1), supra.
section leave no doubt that compensation can be awarded even where specific
performance is impossible and in several cases such compensation has been
awarded. But a plaintiff cannot by his own act make the specific performance
impossible and proceed to claim damages. 54
(b) Other reliefs—The object of Section 21 is to prevent multiplicity of
proceedings. Reading this section with Section 24 it follows that a dismissal of
the suit for specific performance of a contract or its part thereof shall be a bar
for the plaintiffs right to sue for compensation for the breach of such contract or
its part. But it does not close the doors for any other relief to which a plaintiff
may be entitled by reason of the breach.
Section 22 which is a new section introduced by the Act is also there to
avoid multiplicity of proccedings. 55 The section incorporates a rule settled by
judicial decisions that the plaintiff in a sit for specific performance may claim a
decree for possession even though the right to possession strictly speaking
accrues only when specific performance is decreed. Under the section, in
suitable cases, the court may direct a refund for earnest money while refusing
specific performance. Sub-section (2) gives effect to this rule. Sub-section (3)
provides that the court's power under clause (b) is without prejudice to its power
to award compensation under Section 21.
(c) Liquidation of damages not a bar to specific performance—What is
agreed by the parties to be done must he done even if a penalty for its non-
performance is attached thereto, because liquidation of damages is not an option
granted to the other paily to perform a contract or not to perform it. This is he
principle of equity incorporated in the section. In Long v. Bowrin5 ', A contracts
with B to grant him an underlease of property held by A under C and that he
will apply to C for the necessary licence to validate the underlease. If licence is
not procured, A is to pay B Rs 10,000. Now A refuses to apply for licence and
offers to pay B the amount of Rs 10.000. B is nevertheless entitled to have the
contract specifically enforced if C consents to give the licence. Contracts are
made to be performed. not to be broken and evade their liabilities. Naming a
particular sum, even if it is in rerrorern, is to secure its performance and
therefore the courts will enforce its specific performance.
Section 25 read with Section 43 of the Act provides that the provisions of
this chapter apply to enforcement of awards also.
54. A.V.V. Co-op. housing Society Ltd. V. K.K. A. Deo. AIR 1991 Born 129.
55. Bab" La! v. Haari1a! Kisiiori Lal, (1982) 1 SCC 525: AIR 1982 SC 818:(1982) AU 345.
56. (1864)33 Beav 585: 10LT683.
Chapter XXIV
Rectification, Rescission, Cancellation and
Declaration
The remedy of rectification exists to correct, but not to improve an
instrument.''
—Whiteside v. Whiteside, 1950 Ch 65:
[1949] 2 All ER 913 (CA)
Rescission is... not strictl y a judicial remed y but the act of a party
entitled to rescind. ' ... It is a right which a party to a transaction
sometimes has to set the transaction aside and restore to its former
position.
—Snell 's Principles of Equity, Part VI
"The relief as to cancellation of an instrument is founded upon the
administration of the protective justice for fear that the instrument may be
vexatiously or injuriously used by the defendant against the plaintiff
the evidence to impeach it may be lost or that it may throw a cloud of
suspicion over his title or interest.''
—Jeka Dula v. Bai un, 39 Born LR 1072:
AIR 1938 Born 37
"A declaratory decree creates no new rights; it only declares what Was
plaintzffs right before. It is a non-coercive declaration. In many cases a
declaration is inherent in the grant of an injunction.''
—T.R. Desai: Principles of Equity
8th edn., 1959, p. 231; Hanbury:
Modern Equity, para 2, p. 81;
Indumatjhen v. Union of India, AIR
1969 Born 423, cited in Mulla: Indian
Contract and Specific Relief Acts,
9th edn., 1972, P. 911
SYNOPSIS
Text of Sections 26 to 35 3. Grounds for Rescission
A. Rectification (Section 26) 4. Rescission when Adjudged
I. Nature of Rectification (Sections 27. 28 and 29)
2. What is Rectification 5. Refusal for Rescission jScction
3. Conditions to be satisfied 27(2)]
4. When an Instrument may be 6. Important Aspects and Effects of
Rectified (Section 26) Rescission
5. Exceptions C. Cancellation (Sections 31 to 33)
6. What Instruments are Rectified 1. Meaning
7. Time limit 2. Object of Cancellation
8. Defences 3. What can be Cancelled
B. Rescission (Sections 27 to 30) 4. Illustrations
1. General 5, What a Plaintiff must Prove
2. Nature and Meaning
1 4111

4 12 Equity, Trusts and Specific Relief [Chap.
6. Rectification, Rescission and 4. Use of Declarations and

Cancellation: A Comparison Injunctions
7. Minor's position 5. Declaration when Refused
D. Declaration (Sections 34 -and 35) 6. Merely Declaratory Decree
I. Meaning 7. Illustrations
2. Origin and Object of the Provision S. Effect of Declaration
3. Essentials for the Relief
Text of Sections 26 to 35
Rectification of Instruments
26. When instrument may be rectified-41) When, through fraud or a mutual mistake of
the parties, a contract or other instrument in writing [not being the articles of association of a
company to which the Companies Act. 1956 (1 of 1956), applies] does not express their real
intention, then—
(a) either party or his representative in interest may institute a Suit to have the instrument
rectified; or
(b) the plaintiff may, in any suit in which any right arising under the instrument is in issue,
claim in his pleading that the instrument be rectified; or
(c) a defendant in any such suit as is referred to in clause (b), may, in addition to aby other
defence open to him, ask for rectification of the instrument.
(2) If, any suit in which a contract or other instrument is sought to be rectified under sub-
section (1), the court finds that the instrument, through fraud or mistake, does not express the real
Intention of the parties, the court may, in its discretion, direct rectification of the instrument so as
to express that intention, so far as this can be done without prejudice to rights acquired by third
persons in good faith and for value.
(3) A contract in writing may first be rectified, and then if the party claiming rectification has
so prayed in his pleading and the court thinks fit, may be specifically enforced.
(4) No relief for the rectification of an instrument sliall be granted to any party under this
section unless it has been specifically claimed:
Provided that where a party has not claimed any such relief in his pleading, the court shall, at
any stage of the proceeding, allow him to amend the pleading on such terms as may be just for
including such claim.
Rescission of Contracts
27. ',%iivI £Ciiu LIIdy &1C dUJUfJgCU UI 1C&LICU. — i) i%II) Pcibull IIILCICSICU 111 d 1_vniJ4cL
may sue to have it rescinded, and such rescission may be adjudged by the court in any of the
following cases, namely—
(a) where the contract is voidable or terminable by the plaintiff;
(b) where the contract is unlawful for causes not apparent on its face and the defendant is
more to blame than the plaintiff.
(2) Notwithstanding anything contained in sub-section (I), the court may refuse to rescind the
contract—
(a) where the plaintiff has expressly or irnpliedly ratified the contract; or
(b) where, owing to the change of circumstances which has taken place since the making
of the contract (not being due to any act of the defendant himself), the parties cannot
be substantially restored to the position in which they stood when the contract was
made; or
(c) where third parties have, during the subsistence of the contract, acquired rights in
good faith without notice and for value; or
XXI V} Rectification, Rescission, Cancellation and Declaration 413
(d) where only a part of the contract is sought to he rescinded and such part is not
severable from the rest of the contract.
Explanation.—In this section "contract", in relation to the territories to which the Transfer
of Property Act, 1882 (4 of 1882), does not extend, means a contract in writing.
28. Rescission in certain circumstances of contracts for the sale or lease of immovable
property, the specific performance of which has been decreed.---(I) Where in any suit a decree
for specific performance of a contract for the sale or lease of immovable property has been made
and purchaser or lessee does not, within the period allowed by the decree or such further period as
the Court may allow, pay the purchase money or other sum which the court has ordered him to pay,
the vendor or lessor may apply in the same Suit in which the decree is made, to have the contract
rescinded and on such application the court may, by order, rescind the contract either so far as
regards the party in default or altogether, as the justice of the case may require.
(2) Where a contract is rescinded under sub-section (1), the court—
(a) shall direct the purchaser or lessee, if he has obtained possession of the property
under the contract, to restore such possession to the vendor or lessor, and
(b) may direct payment to the vendor or lessor of all the rents and profits which have
accrued in respect of the property from the date on which possession was so obtained
by the purchaser or lessee until restoration of possession to the vendor or lessor, and,
if the justice of the case so requires, the refund of any sum paid by the veñdee or
lessee as earnest money or deposit in connection with the contract.
(3) If the purchaser or lessee pays the purchase money or other sum which he is ordered to
pay under the decree within the period referred to in sub-section (1), the court may, on application
made in the same Suit, award the purchaser or lessee such further relief as he may be entitled to,
including in appropriate cases all or any of the following reliefs, namely—
(a) the execution of a proper conveyance or lease by the vendor or lessor;
(b) the delivery of possession, or partition and separate possession, of the property on the
execution of such conveyance or lease.
(4) No separate suit in respect of any relief which may be claimed under this section shall lie
at the instance of a vendor, purchaser, lessor or lessee, as the case may be.
(5) The costs of any proceedings under this section shall be in the discretion of the court.
29. Alternative prayer for rescission In suit for specific performance.—A plaintiff
instituting a suit for the specific performance of a contract in writing may pray in the alternative
that if the contract cannot be specifically enforced, it may be rescinded and delivered up to be
cancelled; and the court, if it refuses to enforce the contract specifically, may direct it to be
rescinded and delivered up accordingly.
30. Court may require parties rescinding to do equity.—On adjudging the rescission of a
contract, the court may require the party to whom such relief is granted to restore, so far as may be,
any benefit which he may have received from the other party and to make any compensation to him
which justice may require.
Cancellation of Instruments
31. When cancellation may be ordered.—<I) Any person against whom a written
instrument is void or voidable, and who has reasonable apprehension that such instrument, if left
outstanding may cause him serious injury, may sue to have it, adjudged void or voidable; and the
court may, in its discretion, so adjudge it and order it to be delivered up and cancelled.
(2) If the instrument has been registered under the Indian Registration Act, 1908 (16 of 1908),
the court shall also send a copy of its decree to the officer in whose office the instrument has been
so registered; and such officer shall note on the copy of the instrument contained in his books the
fact of its cancellation.
32. What Instruments may be partially cancelled.—Where an instrument is evidence of
differeni rights or different obligations, the court may, in a proper case, cancel it in part and allow
it to stand for the residue.
414 Equity, Trusts and Specific Relief IChup.
33. Power to require benefit to be restored or compensation to be made when

instrument is cancelled or is successfully resisted as being void or voidable.--(I) On adjudging
the cancellation of an instrumcnt, the court may require the party to whom such relief is granted, to
restore, so far as may be, any benefit which he may have received from the other party and to make
any compensation to him which justice may require.
(2) Where a defendant successfully resists any suit on the ground—
(a) that the instrument sought to be enforced against him in the suit is voidable, the court
may, if the defendant has received any benefit under the instrument from the other
party, require him to restore, so far as may be, such benefit to that party or to make
compensation for it;
(b) that the agreement sought to be enforced against him in the Suit IS void by reason of
his not having been competent to contract under Section II of the Indian Contract
Act, 1872 (9 of 1872), the court may. if the defendant has received any benefit under
the agreement from the other party, require him to restore, so far as may be, such
benefit to that party, to the extent to which he or his estate has benefited thereby.
Declaratory Decrees
34. Discretion of court as to declaration of status or right.—Any person entitled to any
legal character, or to any right as to any property, may institute a Suit against any person denying or
interested to deny, his title to such character or right, and the court may in its discretion make
therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further
relief:
Provided that no court shall make any such declaration where the plaintiff, being able to seek
further relief than a mere declaration of title, omits to do so.
Eaplanatiun.—A trustee of property is a ''person interested to deny" a title adverse to the
title of someone who is not in existence, and for whom, if in existence, he would be a trustee.
35. Effect of declaration.—A declaration made under this Chapter is binding only on the
parties to the suit, persons claiming through them respectively, and where any of the parties are
trustees, on the persons for whom, if in existence at the date of the declaration such pasties would
be trustees.
A. RECTIFICATION (SECTION 26)
1. Nature of Rectification
If by mistake a written instrument does not accord with the true agreement
oelween Inc parties, equity nas power to reform or rectify that instrument so as
to make it in accord with the true agreement. What is rectified is not a mistake
in the transaction itself, but a mistake in the way in which that transaction has
been expressed in writing) "Courts of equity do not rectify contracts: they may
and do rectify instruments purporting to have been made in pursuance of the
terms of contracts."2
As expressed in Whiteside case 3 by Evershed, MR., rectification is a
discretionary remedy "which must be cautiously watched and jealously
guarded". But unlike remedies such as specific performance, which are based
on the inadequacy of the remedy at law, rectification "gives relief from the
inflexibility of the common law, and from the nature of the case involves a
1. Frederick E. Rose (London) Ltd. v. William U. Pin? jar. & Co. Lid., (1953) 2 QB 450.
2. Mackenzie v. Coulson. (1869) LR 8 Eq 368. cited in Snel!x Principles of Equity. Part VII,
Chap. 4. p. 610.
3. Whiteside v. Whiteside, 1950 ChC5: 11949)2 All ER913(CA).
XXJV] Rectification, Rescission, Cancellation and Declaration 415
contravention of its terms".' As laid down in Pow/er v. Pow/er5 , oral evidence

is admissible to prove the agreement and there is no need to show anything in
the nature o( error on the face of the instrument; but the evidence of the
agreement must be compelling. The crux of the remedy is proof of what the
parties had actually decided at the Lime of reaching their agreement and not what
they, or one of them, had thought at a later date, or what they might have
thought if they had considered the matter in greater detail or in the light of more
information than that available to them. In other words, the remedy exists to
correct, but not to improve, an instrument.6
2. What is Rectification
As pointed out by Hanbury 7 , rectification of an instrument is a distinct
equitable remedy, based on the facts of an instrument not according with the
intentions of the parties to it. It must be very clearly shown that the parties had
come to a final and genuine agreement and that the instrument had failed to
record it.
As expressed in Sudlia Singh v. Munshj Ram s , the principle on which the
court acts in correcting instruments, is that the parties, are to be placed in the
position as that in which they would have store if no error had been committed.
3. Conditions to be satisfied
Mulla presents the position very lucidly and succinctly, that in a proper case
the court will amend the language of an iistrument for the purpose of making it
accord with the true intention of the parties, having ascertained:-
(i) what that intention was, and also
(ii) that the words as they stand fail to express it.
Rectification cannot be adjudged unless the court is satisfied on both these
points.9
According to Snell, (1) there must be a mistake sufficient to invoke the
doctrine, (ii) there must be "strong irrefragable evidenc&'
l ° which means that
there must be "something more than the highest degree of probability"-' I There
must be evidence "of the clearest and the most satisfactory description", that
will establish the mistake with a "high degree of conviction" and "leave no fair
and reasonable doubt upon the mind that the deed does not embody the final
4 Thompson V. Hickman, 76 LJ Ch 254 (1907) I Ch 550, 562 per Ncvtllc, J.

5. (1859)4 De G&J 250: 45 ER 97.
6. Wh,je,cjde v WIthjde. 1950 Ch 65: (1949)2 All ER 913 (CA).
7. Modern Equit y , 9th cdn.. 1969, p. 661.
8. AIR 1927 Cal 605.
9. Fetlock and Muila: inthan Contract flu and Specific Relief Act,
Snell's Principles of Equin'. pp. 610-619. 9th Edn.. 1972, p. 888;
10. (. os4nxessof Shelburne, (1784) I Hro CC 338.
II. Fowler v. Fow/er. 0859) 4 Dc G&J 250: 45 ER 97.
intention of the parties". In short, there must be a "convincing proof" 2 of the

mistake on the part of the parties. Lastly, (iii) there must be absence of
alternative remedy. Rectification will not be decreed if the desired result can
conveniently be achieved by other means. Thus the material which is sought to
be inserted in the written instrument may itself be enforceable as a collateral
contract. Again, if those concerned voluntarily rectify the instrument, the court
will not decree rectification, even if such a decree would, by operating
retrospectively, have fiscal advantages which the voluntary rectification lacks.13
There is no need, as Pollock and Mulla observe, 14 to invoke this jurisdiction
in case of verbal slips and omissions as are obvious on the face of the writing
and can be corrected by the context alone. The remedy of these minor blunders
is within the court's ordinary function of construing the expressions used. Even
a missing clause (reference to counterpart) can be supplied in an instrument of a
well-known form if the sense clearly requires it.
It must be noted that both the preliminary and the finally executed
agreement can be rectified and an unskillfully drafted instrument not expressing
the real intention of the parties may also be reformed. The proximate origin of
mistake lies in the carelessness or want of skill of the draftsman but when the
mistake has crept in due to concealment or non-disclosure which defeats the real
intention, the party in default will not be allowed to plead that his intention in
concealment or non-disclosure was different.
4. When an Instrument may be Rectified (Section 26)

As the section on rectification goes, to avail of this right one has to establish
that there had been cause for not truly expressing the real intention of the
parties. This relief is to be specifically claimed. Unilateral mistake is no ground
for rectification unless there was fraud. To prove fraud or mistake, oral evidence
is admissible. It has been however the usage of the English courts of equity that
a written instrument will not be allowed to be rectified on oral evidence alone
when the alleged mistake is positively denied by the dcfendant. 15 The Indian
practice is also the same as the zu 'c ati3ficd befcr ar order for
rectification can be made. Rectification may take place at the instance of either
party or their representatives, or by a plaintiff or defendant in any suit, or by the
court in its own discretion. The rectified contract will be enforced if so prayed
by the plaintiff. The material question in rectification is what the parties
intended to express and not what they "always intended".
12. Joscelyne v. Nissen, (1970) 2 QB 86; Uoyd v. Stanbury. (1971) I WLR 535: 1971 2 All ER
267 (Ch D).
13. See Whiteside case c ited above, wherein rectification was refused of a convcnaz* that
mistakenly used the phrase"free of tax" over which the parties had never cocne to an actual
agreement.— Whueside v. Whiteside. 1950 Ch 63: (19491 2 All ER 913 (CA). See also
Hbury: Modern Equity, pp. 661-662.
14. Mdwi Contract Act and Spec4fic Sekef p. 888
15. Pollock and Mulla: Indian Contract Act and Specific Relief Act, citing Clark v. Barnes, (I29)
2 C 368.
XXIV] Recr(fication, Rescission, Cancellation and Declaration 417
In Allarakhia case a steamer was chartered by the plaintiff to sail from

Jeddah on 10th August, 1892 (15 days after the Haj) in order to transport
pilgrims returning to Bombay. The plaintiffs believed that 10th August, 1892
corresponded with the fifteenth day after the Haj. The defendants had no. belief
on the subject. They contracted with respect to the English date. In fact 10th
August, 1892 did not, but 19th July, 1892 corresponded with the fifteenth day
after the Haj. On finding out his mistake the plaintiffs sued the defendants for
rectification of the charter party. The court held that the agreement was one for
10th August, 1892 and that the mistake was not mutual. It was one-sided, i.e. on
plaintiff's part alone. The document therefore could not be rectified. Even if
both the parties were under the mistake the court would not rectify but only
cancel the instrument as the agreement was one for 10-8-1892, and that date was
a matter materially inducing the agreement.16
A intending to sell his house to B and one of the three godowns adjacent to
it, executes a conveyance prepared by B. Through B's fraud all the three
godowns are included in the instrument. Of the two godowns so included
fraudulently B gives one to C and lets the other to D for rent. C and D do not
know of the fraud of B. The conveyance as against B and C .y be rectified so
as to exclude from it the godown given to C, but it cannot be rectified so as to
affect D's lease. 17
S. Exceptions
The illustration above explains that an instrument will not be rectified so as
to prejudice the rights acquired by third parties in good faith and for value)8
6. What Instruments are Rectified
Any instrument can be rectified. Snell 19 has given a long list of such
instruments, but as the section lays down, articles of association of a company
cannot be rectified because the articles are a contract between the company and
its shareholders, and ex hypozliesi the company cannot have had a different
intention before incorporation. Nor is there any power to rectify a will short of
fraud. One must note that for a mistake of law rectification is available. So far as
Section 26 is concerned, the court will allow rectification of an instrument so as
to bring the legal consequences into conformity with those intended by the
parties. This is the limit of rectification and the court will not allow it to be
abused.
The words in Section 26(1) "other instrument", as observed in C.1.T. v.
Kamia Town Trust'-° include a trust deed and therefore a civil court has
jurisdiction to entertain suit for rectification of a trust deed.
16. Haji Abdul Rehman Allarakhjn V. Bombay & Persia Steam Navigation Company, (1892) 16
Born 56.
IT Illustration to Section 31 of the former Act of 1877; L.adha Singh v. Munshiram, 13 CWN
717: AIR 1927 Cal 605.
18.cf. Mahadeva Aiyar v. Gopain Ai yar, (1911) 34 Mad 51: SIC 390.
19. SnelI's Principles of Equity. p. 617
20. (1996)7 SCC 349: (1995)217 iTR 699.
418 Equity, Trusts and Specific Relief - [Chap.
7. Time limit
As decided in Gearda Kahta V. Dharmeswar Saikia 2 ' , a party can file a suit
for rectification at any time when fraud is discovered or a mistake has come to
light.
8. Defences
Laches and acquie.sence will bar a suit for rectification. Besides, where the
remedy sought is found to be inequitable and where it is too late to claim it, as
when a rectified contract is no longer capable of performance, the court will not
order rectification.
The decree of rectification will have retrospective force. The document has
to be read as if it had been originally drawn in its rectified form.22
B. RESCISSION (SECTIONS 27 TO 30)
1. General
It is but common sense that a voidable contract cannot be avoided or
challenged at the suit of the guilty party, but the innocent party who has become
the victim of the transaction and therefore does not affirm the contract but
challenges it in order to avoid it, can plead defences that vitiate and render the
contract voidable. Under the circumstances, and at the instance of such a party,
a court may grant him a remedy of rescission which relieves him of all the
obligations of the contract. Rescission is thus the converse of specific
performance. A right of rescission is not assignable.
2. Nature and Meaning

To rescind, therefore, is "to make of no effect". Rescission is an equitable
remedy which is converse to that of specific performance. It is "a right which a
party to a transaction sometimes has to set the transaction aside and restored to
his former position" 23
Rescission is thus not strictl y a judicial rmdy bitt th p nm of party er'.tit!ed
to rescind. In affecting rescission assistance of the court is necessary to decide
whether a party is entitled to rescind and to obtain restitution of property handed
over pursuant to the transaction. This being an equitable remedy only a court of
equity could do what was necessary to make restitution, e.g., take accounts and
make allowances for deterioration in the property dealt with by the contract.
Equity therefore intervenes to rescind a contract only on substantial grounds.
While adjudging rescission of contract the court is concerned with the question
whether the person rescinding the contract was justified in doing so. The court
does not create any right which parties did not possess when it makes a
declaration that contract has been validly rescinded. The court, one must note,
21. AIR 1961 Ass 14.

22. Craddock Bros v. lIutit. (1923)2 Ch 136: 129 LT 228 (CA).
23 Snell ' s /'rinc:ple.r of Equity, 27th cdn . 1973. Part VII, Chap. 2. p. 601.
24. Ibid.
XXIV] Rectification, Rescission, Cancellation and Declaration 419
does not rescind the contract. The court is only passing upon the validity of the
rescission already made by the party.25
3. Grounds for Rescission
Rescission can be adjudged on the grounds of voidability of the contract
which includes the following: mistake, misrepresentation, constructive fraud
and fraudulent misrepresentation. In case of a contract Uberrimae fidei and
where there is a term in a contract for its rescission, it can be rescinded. But the
right to rescission is lost on account of acquiescence of the plaintiff, on account
of impossibility of restituhio inregram, and due to intervention of third parties in
the contract.
The Specific Relief Act, Sections 27 to 30, deals with rescission.
4. Rescission when Adjudged (Sections 27, 28 and 29)
Any person interested in a contract may sue to have it rescinded and the
court may adjudge it in the following cases:
(a) Where the contract is voidable or terminable by the plaintiff [Section
27(J)(a)].—A contract, as we have seen, becomes voidable on account of
mistake, misrepresentation, fraud, coercion and undue influence and the-party
who becomes its victim can avoid it.
Moreover, a contract may contain within itself a term whereby it becomes
terminable as when (i) a vendor fails to show a good title to the property in
question, or (ii) when the purchaser fails to pay consideration within a stipulated
period. Such contracts are terminable and therefore may be put to an end by the
plaintiff and are therefore rescindable.
(b) Where the contract is unlawful for causes not apparent on its face and
the defendant is more to blame than the plaintiff [Section 27(J)(b)).—Where
such unlawfulness arises, the maxims in pari delicto potier est conditio
defendantis and ex turpi causa non oritur actio may operate. Moreover,
necessity of clean hands will be insisted upon by the court. But even in such
cases it is possible that the defendant is more to blame than the plaintiff as when
the plaintiff has been the victim of the defendant's oppression, imposition,
undue influence and great inequality and hardship due to his age or particular
mental condition,
Where A, an attorney, induces his client B, a Hindu widow, to transfer
property to him for the purpose of defrauding B's creditors, the contract can be
rescinded at the Instance of B and here A. the attorney and B, his client are not
on equal level; not only so, A is more to be blamed as his fault is greater and
more serious than that of his client. As decided in Hari Balkrishna Joglekar v.
Naro Moreshwa, Joglekar26 the provisions of this clause do not apply if the
parties are in pari delicto.
25. ilurigerford h,vr'itnien, into lid. v. IIar,ttos Mndra, ((972) 3 SCC 684 AIR 1972 SC 1826:
(1972) 3 SCR 690.
26. 1 LR(1894) 18 Born 342.
420
(c) Where in a contract for the sale or lease of immovable property a decree
for specific performance is made and the decree made grants a time to the
purchaser or lessee 27 to pay the purchase money or other sum to which he does
not comply, the vendor or lessor may apply to have the contract rescinded, and
the court may rescind the contract. [Section 28(1)]
(d) Where there is an alternative prayer for rescission (Section 29).—
Where, a suit for specific performance is instituted, a plaintiff may pray in the
alternative to rescind the contract and deliver it up for cancellation if it cannot
be specifically performed, and the court may order accordingly.
The words in Section 28(1) "in the same suit" mean in the suit itself, i.e. on
the original side and not in the execution proceedings. An appeal is a
continuation of the suit. After passing the decree for specific performances the
court does not cease to have any jurisdiction. It retains control over the decree
even after the decree has been passed. It is open to court to exercise the power
under Section 28(1) of the Act either for extension of time or for rescinding the
contract as claimed.28
5. Refusal for Rescission [Section 27(2)]

In the following cases the court will refuse rescission-
(i) where the plaintiff has expressly or impliedly ratified the contract; or
(ii) where parties cannot be restored to their original position iri which
they were at the time the contract was made; or
(iii) where third parties have, during the subsistence of the contract,
acquired rights in good faith, without notice and for value; or
(iv) where only a part of the contract is sought to be rescinded and it is not
severable from the rest of the contract.
As noted by Mulla, the sub-clauses of sub-section (2) are a statutory
recognition of the case law on the subject.29
6. Important Aspects and Effects of Rescission30
(a) Damages cannot be recovered,—A party to a contract may commit such
a breach as goes to the root of the contract and releases the other party from his
obligation to perform his part. The party so discharged from his obligation may
yet recover damages for the breach 31 , but a party who has rescinded a contract
cannot recover damages.
27. See Yeshoda v. K. Nagarajan, (1996) Il SCC 228; Sardar MoharSingh v. Mangilal, (1997)9
(Court may
SCC 217; Mohd. Aitmuddin v. Waizuddrn. (1998)9 SCC 108: AIR 1997 SC 1995
extend time for payment.)
28. Ramankutty Guptan v. Avara, (1994)2 SCC 642: AIR 1992
sc 1699: (1994)2 MU 52 (SC):
(1994)1 GLH 416.
Indian contract Act and
29 H. Ganapali v. S. Rajaram, AIR 1974 Born 104; Pollock and Mulla:
Specific Relief Act, 9th Edn.. 1952. P. 895
30. Based on Sne!ls Principles of Equity, pp. 601-607.
31. Harold Wood Brick Co. Ltd. v. Ferris, (1935) 2 KB
198: 153 LT 241.
XXJV] Rectification, Rescission, Cancellation and Declaration 421
(b) Intervention of third parties a bar to rescission—A contract void for

mistake is void ab initio. 32 A contract which a party may rescind is valid unless
and until it is rescinded. This is important when third parties have acquired
rights under the contract, for this will bar the right to rescission and restitution
of property. [Section 27(2)(c)1
(c) Restitution in integrurn is possible.—In illegal contracts, the two
maxims in pari delicto potior est conditio defendantis and ex turpi causa non
oritur actio may operate to prevent any restitution of property. On the other
hand, a party rescinding a contract is entitled to recover and is bound to restore
property which has passed pursuant to the contract. Thus no restitution is
possible where restoration and restitution of property passed under the contract
is impossible. [Section 28(2)(b)J
A enters into a contract with B for purchase of goods under a
misrepresentation practised by B. A sells away the goods or consumes them. He
cannot get rescission of the contract as restoration of the property to B is now
impossible.
(d) Relief of rescission may be prayed for in the alternative in a suit for
specific performance of contract (Section 29), but a person suing for rescission
cannot in the alternative sue for specific performance.--' But if third parties have
acquired rights in good faith, for value and without notice, during the
subsistence of the contract before its rescission, the same cannot be allowed.
[Section 27(2)(c)].
(e) While granting this relief the court may require the party to whom such
relief is granted to do equity, by restoring so far as may be any benefit which he
may have received from the other party and to make any compensation to him
which justice may require (Section 30). This is on the principle that he who
seeks equity must do equity. Thus in case of sale of property, if the vendor has
obtained earnest money and the contract is rescinded at his instance, he will be
ordered to refund the earnest money received by him. But where a contract is
rescinded on account of the purchaser's default, the vendor may forfeit 34 and
retain the deposit already received. Here one must note that the vendor cannot
recover any unpaid part of the deposit, for it is one thing to forfeit money paid
as a pledge and another to seek to enforce an obligation under a contract that has
been rescinded,35
(f) The effect of rescission is restoration of the plaintiff to his original
position as if the contract had not been made. Consequently, property must be
returned, possession given up, and accounts taken of profits or deterioration. But
no damages are recoverable because the purpose of damages is to put the party
32. Cundy v. t.intha y , (1878) 3 App Cas 459: 38 LT 573.

33. Prem Raj v. D.1_Ii /Jou%ing and C 'o,niruciic,n (Pt-I-) Lid.. AIR 1968 SC 1355.
34. Anandjlal Poddar v. Gunendrcr Kr. Ro y, AIR 1966 Cal 107.
35. Lowe v. Hope. 1970 Ch 94: (1969)3 All ER 605 (Ch D).
recovering the 'in the same position (so far as money can do it) as he would
have been, the contract not been carried ow-
C. CANCELLATION (SECTIONS 31 TO 33)
7 - The equitable relief of cancellation of an instrument is based on the maxim

Z "he who seeks equity must be prepared to do equity". To cancel has as its first
meaning the 'removal of written character or other form of record". It literally
means to cross oUt.37 We may say that a document by cancellation is made
inoperative and invalid. It is different from rescission wherein operation of a
document is put to an end.
2. Object of Cancellation
The relief as to cancellation of an instrument is founded upon the
administration of protective justice, for fear that the instrument may be
vexatiously or injuriously used by the defendant against the plaintiff when the
evidence to impeach it may be lost or that it may throw a cloud of suspicion
over his title or interest.-18 In words of Snell, 39 "its mere existence may
nevertheless be embarrassing, e.g., lest some claim be founded upon it, or some
third party be deceived by it. This would be done even if the document was
wholly void at law, unless the defect appeared on the face of the document, so
that it carried its own refutation and there was no need for equity to
intervene". 40 In —other words, if the instrument is left outstanding it will cause
mjury,lo the plaintiff. 41 Sections 31 to 33 make provisions for cancellation.
,.
hat can be Cancelled
or these reasons, a conveyance made for immoral consideration, a
g arantee procured by misrepresentation, a loan made on unconscionable terms,
a lease granted at a low rent mistakenly by the lessor which the lessee knew, or
where there is a forged document or a conveyance which may endanger a title,
or where a document initially valid becomes subseouentiv ineffecrivt' , e g by
reiease or breaking off the engagement for marriage in contemplation of which
it was executed, may be cancelled at the instance of the party to whom it will
cause injury.
But it must be noted that mere speculation as to unknown and vague
complications arising in the future is hardly any ground for cancellation.42
Section 31 of the Specific Relief Act is not limited to a suit for cancellation
of a written contract only. It covers a case where a person against whom a
36. Snell's Principles of Equit y, p. 607.

37. Funk and Wagnall: Standard Handbook of Synon yms, Antonyms and Prepositions, p. 107.
38. Jeka Dula v. Bai Jivi, AIR 1938 Born 37:39 Born LR 1072.
39. Sne!1'.c Principles of Equity, p. 608.
40. Simpson v. Howden (Lord), (1837)3 My & Cr 97: 6 U Ch 315.
41. AIR 1923 Mad 109.
42. Jeka Dula v. Bai .livi, AIR 1938 Born 37: 174 IC 24 (DB): 39 Born LR 1072.
XXI VJ Rectification, Rescission, Cancellation and Declaration
423
written instrument, he it
a contract or deed of sale or a deed of trust or any other
kind of written
instrument, is void or voidable which is sought to be adjudged
void or voidable and cancelled.43
In other words relief of cancellation would be a v ailable when (I) an
instrument is void or voidable against the plaintiff: (2) where the plaintiff may
apprehend serious injury if the instrument is left outstanding and (3) where it is
proper under the circumstances to grant the relief.
As decided in Cooper v. Phibbs44,
a document vitiated by mutual mistake
being a mistake of private rights of the parties, and a document executed under
undue influence as was the case in Huguenin v. Basele 5
plaintiff made a v (wherein a widow
oluntary settlement in favour of a clergy), were likewise
ordered to be cancelled. But in Stapilton case',
a family arrangement made by a
document was not diturhed because equi ty looks upon such arrangements with
(iur.
Illustrations
(a) A, the owner of a ship, by fraudulently representing her to be seaworthy,
induces B, an underwriter, to insure her.
B may obtain the cancellation of the
P olic y. (Section 31)
(b) A draws a bill on B, B endorses it to
C by whom it appears to be
endorsed to D, who endorses it to E. C's
endorsement is forged. C is entitled to
have such endorsement cancelled, leaving the bill to stand in other respects.
(Section 32)
Sections 31 and 32 state that a document can be cancelled in

(010 or in
totality, or in suitable cases where it is evidence of different rights or different
obligations, it
may be cancelled in part and be allowed to stand for the residue.
But in case of its cancellation, the party who obtains such relief has to restore so
far as may be any benefit which he may have received from the other party and
to make any compensation to him which the justice of the case may require.
(Section 33)
5.^ What a Plaintiff must Prove

6 To
be entitled for the decree of cancellation a plaintiff may have to show—
(a) that it is void or voidable against him under one or the other sections of
the Contract Act. One has to note that the person seeking such a cancellation
need not he a party to it47, i.e.,
the relief may be obtained not only by a party to
the instrument but by any person against whom the instrument is void or
voidable. Thus if the creditors of a party are defrauded, defeated or delayed, any
43. Manick La! v. Shiva Jute Bailing, (1948) 52 Cal WN 389.

44. (1867)LR 2 HL 149: 16 LT 678.
45. (1807) 14 Ves 273,
46. Stapilton v. Stapiltun(l 739) I Atk 2.
47. Manick La! v. Shiva Jute Bailing, (1948) 52
Cal WN 389.
424 Equity, Trusts and Spec/lc Relief [Chap.
creditor may sue on behalf of himself and all others. 48 When a person seeking
cancellation is not a party to it, the provisions of the Contract Act do not come
into play .49
the plaintiff has reasonable apprehension that the instrument if left
outstanding may cause him serious injury.
Whether "reasonable apprehension of serious injury" exists or not can be
decided from the circumstances of the particular case with which the court is to
deal Sô , and the apprehension of a party being sued on convenants in a
conveyance apparently binding is "reasonable apprehension of serious injury"
within the meaning of this section.51
Or'1'hat the court ought under the circumstances of the case and in exercise
of its discretion order the instrument to be delivered up and cancelled. The court
has full discretion to order cancellation whether the plaintiff expressly asks for it
or not, and therefore the suit is in no case merely declaratory.52
6. Rectification, Rescission and Cancellation: A Comparison
It will be fruitful to note here the points of similarities and differences.
(a) In so far as rescission and cancellation are concerned, the question at
issue in both is whether or not the contract or the instrument is void or
voidable.
(b) While rescission is "to make of no effect", cancellation is the
removal of written character or other form of record. In other words,
by rescission the operation of a document is put to an end while in
cancellation the document is made inoperative. Thus in rescission, a
document remains operative, in cancellation it is rendered inoperative.
(c) Relief afforded by rescission is consequently limited in scope while
that in cancellation is wider. Rescission is available in regard to
contract only, while cancellation is obtainable with regard to any
instrument.
(d) Relief granted in case of rescission is where contract is merely
voidable or where its unlawfulness or nullity is apparent on the face
of it. In so far as cancellation is concerned, the relief is given in case
of void as well as voidable instruments whether nullity is apparent on
the face of it or not.
In so far as rectification on one side and rescission and cancellation on the
other is concerned, the difference can be laid down as follows:
48. lshvar Timapp Hegde v. Dewar Venkappa Shaubog, ILR (1903)27 Born 146: 5 Born LR 19.
49. Mwiick La) v. Shiva Jute Bailing. (1948) 52 Cal WN 389.
50. Ko:rabassappaya Y. Chenvirappaya, ILR (1899)23 Born 375.
51. Pollock and Mulla: Indian Contract Act and Specific Relief Act, p. 900, where they differ from
a decision (on the above italicised expression) in lyyappa v. Ranialak.thnuzm,na, ILR (1890) 13
Mad 549.
52. Kaztaiya Pillai v. Ramaswamia Pillai, AIR 1929 Mad 396: 56 Mad U 394.
Xxiv] Rectification, Rescission, Cancellation and Declaration 425
(a) In rectification, the contract that is sought to be rectified though
complete and legal and u nobjectionable, does not express the real
intention of the parties, i.e., the writing therein does not correspond
with the intention of the parties. In rescission and cancellation, the
contract or the instrument is void or voidable.
(b) In the former (rectification), the plaintiff does not want to avoid it
altogether. He wants to avoid only a part of it so far as it is on account
of error. In the latter, the contract or the instrument as a whole is
sought to be avoided.
(c) In the former, the relief is in addition to specific performance while in
the latter, specific performance can be alternated with rescission, but
it cannot be so alternated in cancellation.
(d) Thus on the whole the grounds for relief in the former are limited in
scope, those in the latter are wider. Besides, in rectification, what is
rectified is an error not the instrument 53 , in cancellation what is
cancelled is the instrument itself.
7. Minor's position
Sub-section (2) of Section 33 makes a clear provision thaia defendant who

is a minor or a lunatic at the time of making the contract may have to restore, as
far as may be, any benefit received by him whether it is proprietary or monetary.
But there is no liability for making compensation in such cases. This provision
therefore brings an end to a conflict of opinion as to restoration of benefit by a
minor. One view was that "restoration stopped where repayment began"; the
other view was that a minor should restore the benefit when he has made
misrepresentations as to his age.- ,4 In cases where a minor has not expressly
asked for cancellation of an instrument, relying on its being a nullity, the court
may make him restore the benefit under this section.
Still, however, the Orissa High Court in Daneyi case55 and the Mysore High
Court in Dyaviah case- 6
are not of one opinion; the former treating a contract by
the guardian of the minor as void ab initio and holding that neither Section 38
nor Section 41 of the Specific Relief Act, 1877 (Sections 30 and 33 of the
Specific Relief Act, 1963 respectively) can apply; and the latter holding that
restitution in case of void contracts is also applicable in case of minors who
cannot be allowed to have a double advantage."
53. Sabhaji v. Nawalsingh, AIR 1928 Nag 4: 104 IC 736.

54. Lvnbaji v. Rahi, ILR (1925) 49 Born 576: 88 IC
643: AIR 1925 Born 499 (attempted sale by
minor's stepmother, minor required to refund benefit to estate and himself): Rang haul v.
Ma.hbub IlaI,i, ILR (1926)7 Lab 35:94 IC 25: AIR 1926 Lab 170 (similar case in Mahomedan
law); MsIk.hiram v. Jivan Singh, AIR 1953 Pepsu 45.
55. Daneyi Gurumury v. Raghu Pod/ian, AIR
1967 Ori 68; Mohori Bthee v. Dharrnodas Ghose,
ILR (1903) 30 Cal 539: 30 IA I 14,foljowed,
56. Dyrn'iah v. S/il va,nnia, AIR 1959 Mys 188. But see
Mohorl Bibee case and Sections 64 and 65
of Indian Contract Act.
57. See also Emperor v. Brij La!, AIR 1937 Oudh 130: 160 IC 489.
426 Equity, Trusts and Specific Relief (Chap.
D. DECLARATION (SECTIONS 34 AND 35)
1. Meaning
Sections 34 and 35 of the Specific Relief Act, 1963 provide for grant by the
court of a declaration of status or right of the plaintiff and its effect.
"To allege is formally to state as true or capable of proof, but without
proving. To adduce, literally to lead to, is to bring the evidence up to what has
been alleged. Adduce is a secondary word, nothing can be adduced in evidence
till something has been stated or alleged, which the evidence is to sustain. To
speak of an alleged document, an alleged will or an alleged crime, is either to
question, or at least very carefully to refrain from admitting, that the document
exists, that the will is genuine or that the crime is committed; alleged simply
concedes nothing and leaves the question open. But to aver is to declare
confidently. Declare has often an authoritative force."58
may consequently say that declaration is an authoritative
pronouncement by the court in respect of a person's right to property or his
status. Section 34 thus makes a provision for a particular type of relief where
there is no specific performance,__V award of compensation, but merely a
declaration of the rights of the partis.
2. Origin and Object of the Provision

In England, before 1873-75, the courts of law and equity had for long made
declarations in claims brought against the Crown and the courts of equity had
made declarations in other cases where consequential relief was also claimed.
But in 1850 an innovation of a very important kind was made (by the Court of
Chancery Act, 1850, Section 14 and Chancery Procedure Act, 1852, Section 50)
which empowered the Court of Chancery to make a declaration without granting
any consequential relief. In 1873-75 the Judicature Act empowered the Supreme
Court to make declarations whether or not any consequential relief was or even
could be claimed. This led some to form an impression and to assert that
declarations are a form of rqiiirnb! re!ief. 59 !-!o'.ve'.'er. thc Court of AppcY lids
held that they are not; they are "neither land nor equity", but primarily
statutory .61
This provision was incorporated in Section 15 of the Civil Procedure Code,
1859 in India whereby it was lawful for the civil courts to make binding
declarations of right without granting consequential relief.2
58. Funk and Wagnall: Standard handbook of S ynon y ms, Antonyms and Prepositions. pp. 38, 50.
59. Barnard v. National Dock Labour Board, (1953)2 QB IS: (1953) I All ER 1113.
60. Gra y v. Sp yer, (1921)2 Ch 549: 126 LT 238.
61. Snell's Principles of Equit y . p. 571, Hanbury: Modern Equity. p. SI
62 /?ooke' v. Lord Ke,,sinton. (1856) 2 K&J 753: 25 U Ch 7c5; Stri,nathno Moothoo Tijia
Ragomwdah Ranee Kolazidapuree Notch it,, V. l)ora.o,Ia lever, (1875) 2 IA 169; Sadu: Alt
Khan v. Khnjeh Aix/aol Gannet'. 1873 Supp IA 165.
The Code of 1859 was replaced by the Code of 1877 and the provision as to
declaration was transferred to Section 42 of the Specific Relief Act, 1877 which
now stands before us as Section 34 of the Specific Relief Act, 1963.
The object of the legislature was to grant to the plaintiff a relief granted by
the Court of Chancery in cases where no relief at Common Law was available.
Sir Lawrence Jenkins in Deokali Koer v. Kedar Nat11 63 said: "The section
does not sanction every form of declaration, but only a declaration that the
plaintiff is 'entitled to any legal character or to any right as to any property'; it is
the disregard of this that accounts for the multiform and at times, eccentric
declarations which find a place in Indian plaints. If the courts were astute, as I
think they should be, to see that the plaint presented conformed to the terms of
Section 42 (now Section 34) the difficulties that are to be found in such class of
cases would no longer arise." Moreover, 71 is a common fashion to attempt an
evasion of court fees by casting the prayers of the plaint into a declaratory
shape. Where the evasion is successful it cannot be touched, but the device does
not merit encouragement or favour". The section is thus intended to avoid
multiplicity of suits and the courts will not merely make a declaration of a
hypothetical or an abstract right without any reference to its ' r tical utility. 64 If
the plaintiff being able to obtain any further consequential relief omits to do so,
the court shall not grant him a declaratory decrc.
In Abdul Hakim v. Habib Khan, the plaintiff, a tenant of a shop, was on
basis of an undertaking filed under Section 151 C.P.C. by the parties, was
dispossessed of his shop. As he was dispossessed during the pendency of the
suit he was entitled to the possession of the shop. The plaintiff wanted to amend
the plaint to incorporate the subsequent events. It was his duty to do so.
However, his request was objected to by the defendant-petitioner (in H.C.). The
court held that if the plaintiff is dispossessed during the pendency of the Suit for
declaration, amendment of the plaint should not be insisted upon and the
plaintiff should be put back in possession so that status quo ante be restored.
The act of the defendants in this case amounts to overreaching the process of
law and it is the duty of the trial court to protect the rights of the parties as they
existed on the date of filing the Suit.
But one must note that the section is not exhaustive of the categories of
declaratory suits maintainable under the law.67
3. Essentials for the Relief8

To file a suit under this section,
(a) The plaintiff must be a person entitled to any legal character at the
time of the suit.
63. ILR(1912) 39 Cal 704: 151C427.

64, Scibjiri ThnLurnj v. F.A. Savi, AIR 1933 Pat 306: ILR(1933) 12 Pat 359.
65. Kairnud Racijaui v. Mau.ahendra, AIR 1974 Cal 342.
66. AIR 1998 Ral 107. The court relied on Azin, Khan V. State, 1958 Raj LW 90.
67 /,ak vhn,,nara,.,n,/u, Samarciji varr v. Ramulingoni Pit/al, AIR 1920 Mud 573.
68. JeAn Dula V. Rn, Jivi. 39 Born LR 072: AIR 1938 Born 37.
(b) He must be a person entitled to a right to property 69 . This explains

that the interest of the plaintiff must be existing, present interest; it
may be a distant possibility of its coming into possession and
enjoyment. But a mere contingency howsoever proximate will not
suffice if there is no present state of interest.7
0
11-f should have denied these, or be interested to deny this,
character or right. That is to say, there must be some present danger or
obstacle to the interest which the plaintiff seeks to avoid by the
decre6 Mere hypothetical, abstract and speculative grounds would
T5tuffice.7'
(4)--The plaintiff should not be in a position to ask for relief consequential
upon declaration sought. In other words, a cloud must be cast on his
title before he can ask for its removal. He must allege and prove
hostility on the part of the defendant for no court will move on merely
speculative grounds. 72 In other words -,-k ii the plaintiff is able to seek
further relief he must do so; if he omito seek it, the decree will be
refused to hiri
We have to make a note that (i) if any of the first three conditions is not
fulfilled, the suit should be dismissed. If they are fulfilled but the fourth is not,
the court shall not make the declaration requested. (ii) The decree creates no
new rights. It only declares the plaintiff's right he had. (iii) The decree cannot
be claimed as a matter of right because it is discretionary. (iv) If all the parties
are not joined the declaration is not available. 73 (v) The court at the most can
refuse to make a declaration in case the plaintiff does not pray for consequential
relief; it cannot dismiss a suit."" (vi) The proviso to the section does not stop a
plaintiff from seeking a relief he wants unless he asks for the consequential
relief. It contemplates only a further relief which could be claimed against the
defendant only and not one which could be claimed against anybody else. 75 (vii)
Such a decree apart from the provisions of Section 11 of C.P.C., is conclusive
between parties to it and persons litigating through them.
4. Use of Declarations and Injunctions
The action for a declaration is today commonly used as a remedy in public
law either in addition or as an alternative to the injunction .76 A declaratory
decree declares the legal position as to a matter in dispute. In other words it
merely declares the right of the decree holder vis-a-vis the judgement debtor,
but it does not direct him to do or to refrain from doing any particular act or
69. Saurashtra Vipra Sabha Y. Narnakkal Munkipatitv, (1996) 11 SCC 584.

70. WajidAli Shah v. Dianat-ul-lah-Beg, ILR (1886)8 All 31.
71. Sabitri Thakurain v. F.A. Savi. ILR (1933) 12 Pat 359: AIR 1933 Pat 306.
72. Jeka Dula v. Rai Jivi, 39 Born LR 1072: AIR 1938 Born 37: AIR 1930 Lah 803.
73. Maharaja of Renare.% v. Ramji Khan. ILR ( 1905) 27 All 138.
74. Kunj Rihari v. Ke.vhav(ai. ILk (1904)28 Born 567.
75. Ilaninysiri Ikgani v. Shah Maha,nmad Khan AIR 1943 PC 94: 207 IC 188.
76. Haribury: Modern Equity, Chap. 3. p. 8!.
thing. 77 Such a decree when granted is not in itself an order of the court which
has to be obeyed. It can be said to be a non-coercive declaration. It is for this
reason that applicants frequently apply for an injunction as well as a declaration
so that the relief obtained is, so far as the injunction is concerned, enforceable.78
Looking from a different angle, in declaration, a court cannot grant the
declaratory relief where further relief could be obtained. In case of injunction,
there is no such restriction; it can be granted without requesting for a
declaration, though one cannot fail to note that in many cases a declaration is
inherent in the grant of an injunction."
Section 34 is not exhaustive of cases in which a declaratory decree can be
made. Consequently as held in Ratnamala Dassi court has power to grant such a
decree independently of the requirements of the section. For example in the
instant case a suit by a tenant for declaration relating to his interest in the
tenanted property was held as m
aintainable, as such an interest is property.80
Declaration when Refused
(a) 1n case of vexatious litigation._—In Deokalj Koer case 81 , it
was
expressed that the section does not sanction every form of declaration,
but only a declaration that the plaintiff is "entitled to any legal
character or to any right as to any property". If this is disregarded it
will give rise to multiplicity of proceedings.' Before that, in Narajn
Miller's case 82 , this proposition was exprd by the Privy Council
thus: 'In every case the court must exercise a sound judgment as to
whether it is reasonable or not under all circumstances of the case to
grant the relief prayed for. There is so much danger in India of
harassing and vexatious litigation that the courts in India ought to be
most careful that mere declaratory suits be not converted into a new
and mischievous source of litigation".
(win case of evasion of court fee.—When
prayer casted in the form of
declaratory suit is an attempt at an evasion of court fee 83 , such relief
would be refused.
/
case of mulriplicir ' of suits.—When it amounts or leads to
multiplicity of suits for the same cause of action, relief of declaration
may be refused.84
In Ashok
Kumar Srivastava case", the appellant was appointed on certain
terms and Conditions. He was initially put on probation for twelve months.
77. State of M.P. v. Mangilal Sharma, (1998) 2 SCC

995. 510: 1998 SCC (US) 599: (1998) 1 LU
78. Hiles V. Amalgamated Society of Wo
Indumatiben Chimantal De.taj v. Union odworkers, 1968 Ch 440: (1967) 3 All ER 70 (Ch D);
of India, AIR 1969 Born 423.
79. Ibid.
80. Rag namala Da,s.ii v. Ratan Singh Sawn. AIR 1990 Cal 26.
81. De,ka/j Kuer v. Kedar Nat/i, ILR
(1912) 39 Cal 704: IS IC 427.
82. Narain Muter v. Ki.then &iondari Dassee. 1873 Supp IA 149
83. Deo Kali Koerv, Kedar Nath,(1912) 39 Cal 704:15 IC 427.
84.See Indian Iron c Steel Co. Ltd. V.
Chhagan/1 Marwari, 1994 Supp (3) SCC 719.
430 Equia'v, Trusts and Specific Relief (Chap.
Conditions of his appointment stated that unless a letter appointing him as a

probationary Inspector is issued before expiry of his probation period, his
services shall stand terminated. No such letter was issued before expiry of
probation period. His initial period of probation was also not extended. He
therefore sued for declaratory relief that he continues in service. It was held that
no such declaration can be given.
Similarly in Nava/ram case", it has been held by the Gujarat High Court
very recently that a casual unnoticed user of open piece of land cannot be
considered as exclusive possession of the land conferring right over the land in
the person using it. Here the plaintiff was in exclusive possession of the land.
The presumption, therefore, that possession follows the title comes into play and
construction of water tank or shed over a small piece of land by the defendant
which was convenient in many ways to him and was made use of by him,
without notice of plaintiff would not be construed as an act of dispossession of
plaintiff necessitating the claim for possession by the plaintiff as contemplated
by S. 34 of the Act. Other efficacious remedies are available to the plaintiff.
6. Merely Declaratory Decree

A question was posed in Kathama Natchiar case 87, whether the courts in
India had power to make a merely declaratory decree otherwise than under
Section 15 of the Civil Procedure Code. 1859 (see "origin and object" in para 2
above in this section) and it was answered in the negative. The correct view, as
expressed by Pollock and Mu11a88 , is that Section 34 is exhaustive of the cases
in which a decree merely declaratory can be made and that the courts have no
power to make such a decree independently of that section. This view of the
text is approved in Kishorilal v. Begraj19 by the Punjab High Court. At all
events one must note that the proviso to Section 34 is paramount and its effect
cannot be avoided. After referring to the observations of the Privy Council in
Sheoparasan Singh case 90 and Fischer case91 , the Calcutta High Court in
Manjur Al Haque case 92 has upheld this view. This means that a declaratory
decree could not be made unless there was a right in r onsequential relief capabc
of being had in the same court or in some cases in some other court, i.e., a
revenue court. Under the present section a Suit would lie for a merely
declaratory decree though no.consequential relief could be claimed, e.g., a
suit by an owner of land against any member of the public who formally
claims to use such land as a public road and who thereby endangers the title of the
$5. Ashok Ku,nar Srivastava v. National Insurance Co. Lid., AIR 198 Sc 2046.
86. Nova/ram Lixmidas Dermurari v. Vijavaben Jayavant Bhas Chavda, AIR 1998 Guj 17.
87. Siri,nathoo Moothoo Tijia Ragoonadah Ranee Kalandapuree Natchiar v. Dora.'inga Tever,
(1875)2 IA 169.
88, Indian Contract Act and Specific Relief Act, 9th Edn., 1972, p. 910.
$9. Kishori Lai v, Beg Raj, AIR 1952 Punj 387.
90. Sheoparsan Singh v. Ramnandan Singh, (1916)43 IA 91: ILR (1916)43 Cal 694: 33 IC 914:
AIR 1916 PC 78.
91. F.chvr v. Secretary of Stale for India in Council. (1899126 IA 16: ILR (1899) 22 Mad (270),
92. Chowdhury Mohammad Manjurol ilaque v. SeL'ait of Sri Sri iswar Lak.shmi Narayan Jew
Thakur, AIR 1943 Cal 361.
XXIV] Rectification, rescission, Cancellation and Declaration 431
owner) Similarly, a suit lies for a mere declaration that a new valuation by a
municipality is not void. 2 Where a defendant is not in possession or not in a
position to deliver possession of the suit properties, no "further relief" than a
declaration of the right to possession is available to the plaintiff and the proviso
to Section 34 is no bar to granting such a relief of declaration. 3 It is however to
be noted that a contract of personal service cannot normally be enforced. A
court in such circumstances would not grant a declaration that the contract
subsists and that the employee, even after having been removed from service
can be deemed to be inservice against the employer's will and consent. 4 The
rule has however the following three exceptions as declared in Vaish Degree
College case by the Supreme Court.'
(a) In cases where a statutory body acts in contravention of the
mandatory provisions of the statutes;
(b) In cases where a public servant is sought to be removed from service
in contravention of Article 311 of the Constitution of India 6 ; and
(c) In cases where a worker is sought to be reinstated on his being
dismissed under the Industrial Law.
7. Illustrations
is lawfully in possession of certain land. The inhabitants of a
neighbouring village claim a right of way across the land. A may sue
for a declaration that they are not entitled to the right so claimed.
A alienates to B property in which A has merely a life interest. The
alienation in invalid as against C, who is entitled as a reversioner. In a
1.,, P' ...-.,..,,,-., A .....-1 D h--
.....•j S... •
A Hindu widow in possession of property adopts a son to her
husband. The person presumably entitled to possession of the
property on her death without a son may, in a suit against the
adopted son, obtain a declaration that the adoption was invalid. (For
contra see Gum#nalapura Taggina Matada Kotèuruswa,ni v. Setra
Vee ray vu 7),
8. Effect of Declaration (Section 35)
As the section lays down, a decree under this section is binding on the
actual litigating parties, the persons litigating through them, and also to the
beneficiaries under the trust. The declaration of status obtained under this
I. 011411hlczlannth v, Rn,,, Ki shen Sahu, 1[.R (1888) 15 Cal 460

2. Surendranath v. chairman of (he Municipal Conu,,r.s.
Of Min,en Singh. (1934) 61 Cal 276:
AIR 1934 Cal 673: 152 10694.
3. Sunder Singh Mat/nh Singh Sannian D1,ara,n High School Trust v. Managing Committee,
(1938) 65 IA 106.
4. J. Tiwnri v. Jwala Devi V/dyn Mandir, AIR 1981 SC 122.
5. Va is/i Degree College v. Lax,,,, Nara van, AIR 1976 SC 888.
6. Mv.tnr SRTC v. ?i'f(rza Khnsjn, Ali Beg. (1977) 2 SCC 457:
AIR 1977 sc 747.
7. AIR 1959 SC 577: 1959 Supp i SCR 965.
section though should generally be operative in rem but it has been made clear
in Munyraj case by the Hyderabad High Court that a declaration made in
respect of the adoption of a certain person is not a judgement in rem.8
S. Munwzraj v. Venkatapati. 1955 Hyd 172.

Chapter XXV
Injunctions
"By means of its decrees for specific performance me Court of
Chancery obtained command of one great province of law, namel y, of
contracts for the sale of land. It fashioned another weapon, namely, the
injunction, which was far more flexible, far more generally applicable and
thereby it obtained not merel y certain particular fields of justice, but a
power of making its own doctrines prevail at the expense of the common
law."
—Maitland: Lectures on Equity,
p. 318
Injunction is "a judicial process by which one who has invaded or is
threatening to invade the rights, legal or equitable, of another, is restrained
from continuing or commencing such wrongful Act".
—A.W. Renton: Encyclopaedia of the Laws of England,
Vol. 6, p. 464
No one can be allowed to use his own property in such a manner that it
creates a nuisance for his neighbours.
—Darshan P"2 v. Nazar Ram,
AIR 1989 P&H 253.
S Y NO P S S
1. Text of Sections 36 to 42 (a) To maintairi status quo
2. Preventive Relief (b) To restrain Judicial Proceedings
3. Injunction: Origin, Nature and (c) To prevent breach of a duty or an
Derinjuon obligation
4. Types of Injunction (Section 36) (1) Contractual Obligations
5, Difference Between Temporary and Injunction to perform
Perpetual Injunctions Negative Agreements
6. Principles Governing Injunction (ii) Obligations arising under
General Law
7. Temporary Injunctions (Section 37;
Order 39, Rules I, 2. 3) (I) Trust Obligations
(2) Civil wrongs or Tort
8. Perpetual Injunctions (Section 38)
(3) Any other obligation:
9. Mandatory Injunctions (Sections 39
and 40) Legal or equitable
11. Injunction when Refused (Section 41)
10. In what cases granted
Injunction Generally
36, Preventive relief how granted.—Prcventive relief is granted at the discretion of the court
by injunction, temporary or perpetual.
37. Temporary and perpetual injunctions.—(l) Temporary Injunctions are such as are to
continue until a specified time, or until the further order of the court, and they may be granted at
any stage of a suit, and are regulated by the Code of Civil Procedure, 1908 (5 of 1908).
(433]
(2) A perpetual injunction can only be granted by the decree made at the hearing and upon the
merits of the suit; the defendant is thereby perpetually enjoined from the assertion of a right, or
from the commission of an act, which would be contrary to the rights of the plaintiff.
Perpetual injunctions
38. Perpetual Injunctions when granted.—(l) Subject to the other provisions contained in
or referred to by this Chapter a perpetual injunction may be granted to the plaintiff to prevent the
breach of an obligation existing in his favour, whether expressly or by implication.
(2) When any such obligation arises from contract, the court shall be guided by the rules and
provisions contained in chapter Il.
(3) When the defendant invades or threatens to invade the plaintiffs right to, or enjoyment of,
property the court may grant a perpetual injunction in the following cases, namely:—
(a) where the defendant is trustee of the property for the plaintiff;
(b) where there exists no standard for ascertaining the actual damage caused, or likely to
be caused, by the invasion;
(c) where the invasion is such that compensation in money would not afford adequate
relief;
(d) where the injunction is necessary to prevent a multiplicity of judicial proceedings.
Mandatory injunctions.—When. to prevent the breach of an obligation, it is necessary to
compel the performance of certain acts which the court is capable of enforcing, the court may in its
discretion grant an injunction to prevent the breach complained of, and also to compel performance
of the requisite acts.
40. Damages in lieu of, or in addition to, lnjunctlon.—(l) The plaintiff in a suit for
perpetual injunction under Section 38, or mandatory injunction under Section 39, may claim
damages either in addition to, or in substitution for, such injunction and the court may, if it thinks
fit, award such damages.
(2) No relief for damages shall he granted under this section unless the plaintiff has claimed
such relief in his plaint;
Provided that where no such damages have been claimed in the plaint, the court shall, at any
stage of the proceedings, allow the plaintiff to amend the plaint on such terms as may be just for
including such claim.
(3) The dismissal of a suit to prevent the breach of an obligation existing in favour of the
plaintiff shall bar his right to sue for damages for such breach.
41. Injunction when refused.—An injunction cannot be granted—
e
(o to rta" a-y fia. . judi.a piuccediiig P nding at tne
institution of the suit in which the injunction is sought, unless such restraint is
necessary to prevent a multiplicity of proceedings;
(b) to restrain any person from instituting or prosecuting any proceeding in a court not
subordinate to that from which the injunction is sought;
(c) to restrain any person from applying to any legislative body;
(d) to restrain any person from instituting or prosecuting any proceeding in criminal
matter:
(e) to prevent the breach of a contract the performance of which would not be
specifically enforced:
to prevent, on the ground of nuisance, an act of which it is not reasonably clear that it
(j)
will be a nuisance;
(g) to prevent a continuing breach in which the plaintiff has acquiesced;
(It) when equally efficacious relief can certainly be obtained by any other usual mode of
proceeding except in case of breach of trust;
xxv] Injunctions 435
(i) when the conduct of the plaintiff or his agents has been such as to disentitle him to
(hc assistance of the court;
(j) when the plaintiff has no personal interest in the matter.
42. Injunction to perform negative agrecment._
clause (e) of Section 4 Notw,ihstafling anything contained in
1, where a contract comprises an affirmative agreement to do a certain act,
coupled with a negative agreement, express or implied, not to do a certain act, the circumstance
that the court is unable to compel specific performance of the affirmative agreement shall not
preclude it from granting an injunction to perform the negative agreement:
Provided that the plaintiff has not failed to perform Use contract so far as it is binding on him.
2. PREVENTIVE RELIEF
The principles of Chancery Courts postulated that a man will be punished if
he does what his conscience tells him not to do. Consequently, the best and the
surest way was to prevent him from doing that act by means of an injunction.
These principles arose out of the inadequacy of the Common Law and the
general tendency of the contemners of law. For example, when a person had by
contractual obligations undertaken not to set up a rival business, or not to
engage himself in another's service for a particular period, or not to encroach
upon another's land, equity would restrict or prevent him from doing that act.
Injunction is thus a mode of enforcing specific performance of negative
agreements. Since the general purpose of injunction is
to restrain the
commission, continuance or repetition of some wrongful act which one is under
an obligation not to do, the relief provided by the Chancery Court at its
discretion to the plaintiff is called preventive relief. But at the same time, one
cannot fail to note that the preventive relief protects rights arising otherwise than
from contracts as is evidenced by the Swindon company case.'
In this case
Swindon Company, a proprietor of a tenement on a river bank collected and
diverted the fl y
er water for supplying it to a nearby town, to the detriment of the
benefit of the lower riparian owners who filed a suit for injunction and the same
was granted as the owner of the lands higher up the stream cannot divert water
for the benefit of persons unconnected with any part of the stream.
In a recent case 2
an injunction against proposed location of a cemetery was
granted on the same principle. Cemetery in this case was proposed in a crowded
residential area and the distance up to the house of the plaintiff was Only 78 feet.
Consequently there was possibility of noxious gas escaping concrete vaults and
obnoxious over-flows from underneath cells and pollution of drinking waterof
the well in the plaintiff's residential compound was not ruled out. It was held
that the plaintiff was entitled to injunction as proximity of cemetery to his
residence could be a strong and continuous cause for annoyance.3
The Indian Specific Relief Act, 1963, Sections 36 to 42 make provision for
this relief by selecting certain leading English principles and incorporating them
in the topic.
I. Swindon Walenvorks Co. V.

(HL). Wilti Herks Canal Na vigation Co.. (1875) 7 HL 697: 33 LT 513
2. St. Joseph church, Pu.nkum,ian v.
ye/u, AIR 1989 NOC 124 (Ker).
3. Ibid.
3. INJUNCTION: ORIGIN, NATURE AND DEFINITION

Before the Judicature Act, 1873, the cases wherein equity interfered and
granted preventive relief fell into two classes: (i) cases to prevent the inequitous
institution or continuation of judicial proceedings. and (ii) cases of wrongful
acts unconnected with judicial proceedings. Originally the court of chancery
alone had this jurisdiction which resulted in duplication of work as where the
plaintiff required an injunction to enforce a legal cause of action but now by the
Judicature Act. 1925, Section 45, the High Court grants injunction by an
interlocutory order in all cases in which it appears to the court to be just and
convenient to do s0. 4 The jurisdiction of the court is exercised not on the
individual preference of the judge, but "according to sufficient legal reasons or
on settled legal principles. It must be 'just' as well as 'convenient'
\ijunction is an order of the court to a party to the proceedings to do or to
refriii from doing a specified act. It is granted in cases in which monetary
compensation affords an inadequate remedy to the injured party.5
As Maitland puts it, injunction "is an order made by the court forbidding a
person or class of persons from doing a certain act, or acts of a certain class,
upon pain of going to prison as contemners of the court. The penalty, is not
mentioned in the injunction, but if knowing of an injunction you break it, then
the courLjlas a large discretionary power of sending you to prison and keeping
you there
The object of an injunction, it should be noted, is usually preventive rather
than prohibitive.
4. TYPES OF INJUNCTION (SECTION 36)
An injunction is either (i) temporary (Section 37) (ii) perpetual or
permanent (Sections 37 and 38), or (iii) mandatory (Section 39).
Temporary or interlocuron' inunctionis granted before the trial of an
action. Its object is to-'keep matters status quo until the iuestion at issue between
the parties is determined. As the section explains, temporary injunctions are
such as are to continue until a specified time, or until the further order of the
court, and they may be granted at any stage of a suit and are regulated by the
Code of Civil Procedure, 1908. They are also called interim injunctions.
Permanent or perpetual injunction is granted only after the plaintiff has
establis ed his rig and the actual or threatened infringement of it by the
defendant. As the section goes, a perpetual injunction can only be granted by the
decree made at the hearing and upon the merits of the suit. The defendant is
thereby perpetually enjoined from the assertion of a right, or from the
commission of an act which would be contrary to the rights of the plaintiff.
4. 1-lanbury: Modern Equity. pp. 59. 60.

5 Snell'' I'rincipIe. of Equit y , p. 624. 1-lanhury: Modern Equity, P. 59, See Encyclopaedia of the
1,ziws of England. p. 44.
6. Maitland: 1.4, c rure.c on Equi', V . 318.
XXV1 Injunctions 437
From he point of view of time, the injunctions are interlocutory or

permanent I3i1t from the viewpoint of nature, injunctions may be divided into
prohibitory or mandatoj
An injunction restraining the doing or continuance of some wrongful act is
called prohibitory or restrictive. An injunction to restrain the continuance of
some wrongful omission is called mandatory . Section 39 explains a mandatory
Injunction thus: "When to prevent the breach of an obligation, it is necessary to
compel the performance of certain acts which the court is capable of enforcing,
the court may at its discretion, grant an injunction to prevent the breach
complained of, and also to compel performance of the requisite acts".
An injunction is an order of the court. An order is more authoritative than a
direction. A mandate stresses heavily the idea of the highest authority.
Prohibition is wholly negative; it is a command not to do: injunction is generally
so used, especially as the requirement by legal authority that certain action be
suspended or refrained from, pending final legal decision.7
Injunction, thus restrains a person's action in future, it is not a remedy for
breaches already made or wrongful acts already done before. It may be that
assistance of the court is obtained and such actions restrained before the same
are committed. But this is rare,. generally the court's assistance is sought only
after the act is committed. Consequently, an injunction is given for restraining
future actions. In such cases, for the acts done in the past compensation is an
adequate relief and a proper remedy. But as a measure of precaution in order to
stop those acts (e.g., nuisance) so that they may not assume a permanent and a
tangible form, a prohibitive injunction from the court is necessary. For example,
where A uses B's premises as a shortcut to reach his office, A can be restrained
by an injunction to repeat such acts and for the acts already committed by him B
may obtain compensation. When an injunction is granted in order to prevent a
threatened wrong it is termed as a quia timer injunction. Here a person takes a
preventive measure before an event takes place.
5. DIFFERENCE BETWEEN TEMPORARY AND

PERPETUAL INJUNCTION
(a) The nature of a temporary injunction is provisional, continuing until a
specified time or until the further order of the court. A permanent injunction can
only be granted by decree made at the hearing and holds good without any time
limit.
(b) While the former is granted to preserve the status quo, the latter is
granted to preserve and protect the right established by the plaintiff.
(c) While the former can be granted at any period of the suit, even ex parre,
without notice to the other party to show cause why it should not be granted, the
latter can only be granted after the trial when the plaintiff has established his
case and on the merits of the case.
7. Funk and WgnaU: Standard Handbook of Synonyms Anton yrns and Prepositions, p. 304.
438 Equity, Trusts and Specific Relief (Chap.
(d) A temporary injunction is an outcome of emergency and therefore it is

provisional; it does not conclude any right. A perpetual injunction on the other
hand concludes a right; it is in effect a decree.
(e) Consequently, a temporary injunction restrains the defendant for a
particular time only (till the date of hearing at the most) while a perpetual
injunction restrains him for ever.8
(f) Grant of the former is regulated by the Code of Civil Procedure, Order
39, Rules 1 and 2, while the latter is regulated by Sections 38 to 42 of the
Specific Relief Act.°
(g) A temporary injunction can be dissolved under Order 39, Rule 4 of the
C.P.C.. or else it terminates automatically when the suit is decided. A permanent
injunction cannot be dissolved as it holds good for ever restraining the
defendant perpetually from the assertion of a right or from the commission of an
act which would be contrary to the right of the plaintiff.
6. PRINCIPLES GOVERNING INJUNCTION

The general principles underlying the grant of an injunction are similar to
those involved in granting specific performance of contracts or of enforcement
of other positive obligations. The following are the general points which require
particular attention:
(, 4' Wjenever a right exists or is created by contract, by ownership of
property or otherwise, cognizable by law, an injunction will be issued
to protect a violation of that right\ and the restraining power of the
court extends through the whole range of rights and duties recognised
by law and would be applied to every case of intended violation
unless there are other reasons of policy or expediency which control
and limit its exercise)°
C Granting of an injunction is a matter of judicial discretion for the
court. Though the grant of injunction is discretionary the same must
I- -
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tiLl
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tlC%.L
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justice.'1
The court granting an injunction must rightly appreciate the facts and
apply to those facts the true principles. Then and only then it becomes
a sound exercise of judicial discretion. 12 The exercise of discretion is
thus not arbitrary or capricious but is based on sound common sense
and is regulated by well settled principles.13
8. Apaji Patil v. Apa. 4 Born LR 534: ILR (1902) 26 Born 735; Lawndes v. Betrle. (1864) 33 II
Ch451: 10LT55.
9. Indu She/char v. Fule Devi, 1968 BLR 268.
10. Bhawarilal v. S. Jakhand, (1975) 1 Kant U I: ILR 1975 Kant 127: AIR 1975 Kant 122, 123;
Pritam Kumar v. Nagar Palika (Municipal Committee). (1986) i CU (C&Cr.) 213 P&H.
11. Surya Nash Singh v. Khedu Singh, 1994 Supp (1) SCC 561: sec also Tamil Nadu Housing Bd.
v. A. Viswam. (1996) 8 SCC 259.
12. Subba Naidu v. Haji Badshn, ILR (1903) 26 Mad 168: 13 Mad Li 13.
13. Ganpazla! v. Nandlal Haswani, AIR 1989 MP 209.

XXVI Injunctions 439
(/.The court must see that there is a bona fide case between the parties.
(. And in that case it must also see on which side, in the event of
success, will lie the balance of convenience if the injunction does not
issue.
If the effect of not granting an injunction will be to deprive the
plaintiff for ever of the right claimed by him in the suit, the court
should grant a temporary injunction.'
( ' Jf the act complained of can be relieved by compensation the court
will exercise its discretion and will not grant injunction. In other
words, when an efficacious relief can be obtained by any other usual
mode of proceeding, injunction cannot be granted. 16
( Injunction is granted to maintain the status quo ante. 17
(i) Where a plaintiff establishes his right and also a threatened violation
thereof by the defendant, Injunction, follows more or less as a matter
of course. But here also if granting of the same is under the
circumstances found to be unjust, inexpedient and oppressive, the
court in its discretion will refuse it.
The relief of injunction being equitable and discretionary it cannot be issued
in favour of a trespasser or a person who gained unlawful possession as against
the true owner. 19
u.f'() Courts are very slow in granting an injunction against an isolated or
occasional breach but in case of a continuous breach or wrong,
injunction would be more readily issued.
(k) When a suit is for a permanent injunction of one kind, interim
injunction of a different kind cannot be granted. 19
(I) No interim injunction can he granted when the suit is for declaration
only.2°
A mandatory injunction requires more stronger grounds than those
required for obtaining a restrictive injunction.2'
14. Ibid.: Doliern' v. Allman, (1878) 3 AC 709: 39 LT 129;

S.S.V. Krishnan Pillaj v.
Kilasathammal AIR 1928 Mad 810.
15. Secreja y-v Civil Station Sub-committee, Nagpur v. Govzndrao Kashinat/i Soma/war, ILR
1937 Nag 313: 170 IC 239: AIR 1937 Nag 137.
16. Morunwl v. Gobindram Rikhcijand, AIR 1933 Sind 176;
Holland-Bombay Trading Co. v.
Esxardav Dharnmehand AIR 1925 Sind 175.
17. LD. Me.tton School Society v. Ka y /i Nat/i iii.ra. AIR
1951 All 558; EM. Gupalakrishna
Konarv.A. Vilanga Konar, AIR 1926 Mad 32: 90 IC 819.
18. Premji Ratanse',' c/ia/i v. Union of India,
(1994)5 SCC 547,550; sec also TN. Housing Board
v. A. Vi.i-wam, (1996) 8 SCC 259.
19. Za ndaramJoiraram v. Prahjadrao Vitha/rao AIR 1963 Guj 160.
20. Mohammad Ibrahim Khan v. Paleshvi ,ari Prasad Singh,
AIR 1960 All 252.
21. Deutsche l)ampvchif-fahrt.c Gssebchaft Hansa of Bermen v. Firm of Pestonji Bikhaji AIR
1925 Sind 347:21 Sind LR 170:89 IC 321, ,
(n) While granting an injunction the court may in its discretion impose
equitable conditions according to the circumstances of each case.
Injunction rests on the equitable principle that he who seeks equity
must do equity, and that the plaintiff requesting it must come with
clean hands. If the plaintiff has acted in an unfair and inequitable
manner he cannot have relief,22
(p) The court is not bound to grant injunction in every case and an
injunction to enforce negative convenant would be refused if it would
indirectly compel the employee either to idleness or to serve the
employer.23
(q) Once a perpetual and mandatory injunction is given and it becomes
final, any attempt to circumvent the same cannot be permitted. Its
non-compliance would be continuing disobedience entailing penal
consequences.'
(r) Where a plaintiff apprehends encroachment on his land and proves so,
he is entitled to permanent injunction restraining the defendant from
encroaching or interfering with peaceful possession of his property.'
(s) Court should not issue an injunction which in operation is
contradictory and ineffective. 26 Relief under Section 41(h) being a
discretionary equitable relief it should not be granted where other
equally efficacious relief is obtainable in any other usual mode or
proceeding except in cases of breach of trust. 27 Similarly court should
not easily interfere in the affairs of autonomous bodies, such as
educational institutions or clubs.
(:) A plaintiff on the strength of his possession can resist interference
from persons who have no better title than himself to the suit
property. 29 Once a suit has been filed by the respondent claiming to be
the owner of the land and being in possession of it the suit cannot be
treated as a suit based on possession without reference to title.30
Lt!y, an injunction cannot be granted against a person 1.13 restrain him from
discharging his public duties, for, law will not permit anyone to restrain a person
from doing what the public welfare and his own interest requires that he should
do. 3 ' Ordinarily proceedings are not to be stayed by injunction unless the court
22. BaxhesharNaih v. Municipal Committee, AIR 1940 Lah 69: 188 IC 264; Ganesh Panigrahi
v. Jura Sahu, AIR 1973 Oil 232, 234.
23. Gujarat Bottling Co. Ljd. v. Coca cola Co., (1995) S SCC 545: (1995)84 Comp Cas 618.
24. Jai floral v. Kravl,,,a La! Garg. (1996) 11 SCC 588.
25. !Caliuppun v. L)urai. AIR 1998 Mad 65.
26. I!.M. Kamaluddin Ansari & Co. v. Union of India. (1983)4 SCC 417: AIR 1984 SC 29: 1983
ALT 1104.
27. Mzini. Corpa. of Delhi v. Suresh Chandra Jaiparia, (1976)4 5CC 719.
28, Shyamlal Yadavv. KusuniDhawan,(1979)4SCC 143: AIR 1979 SC 1247.
29. M. Katappa Setty v. M.V. Lo..xminarayan Rao, (1973)2 SCC 358: AIR 1072 SC 2299.
30. Nagar Palika v. Jagat Singh. (1995)3 SCC 426: AIR 1995 SC 1377: (1995)3 Punj LR 224.
31. Palapatti Raghudu v. Nallagadda Erraiya, AIR 1938 Mad 881: 1938 Mad WN 806.
XXV] Injunctions 441
where they are to be stayed is subordinate to the court wherefrom injunction is

sought. As held by the Supreme Court injunction is passed for the purpose of
being carried out, not for the fun of passing it. 32 It cannot be demanded as a
matter of right.
7. TEMPORARY INJUNCTIONS (SECTION 37)

Section 37 of the Specific Relief Act speaks of temporary injunctions. The
granting of this type of injunction is governed by Order 39, Rules 1 and 2. As
the rules go, temporary injunction may be granted in the following cases:
Where in every Suit it is proved by affidavit or otherwise—
(a) that any property in dispute in a suit is in danger of being wasted,
damaged or alienated by any party to the suit, or wrongfully sold in
execution of a decree, or
(b) that the defendant threatens or intends, to remove or dispose of his
property with a view to defraud his creditors, the court may by order
grant a temporary injunction to restrain such act, or make such other
order for the purpose of staying and preventing th waste, damage,
alienation, sale, removal or disposition of the property as the court
thinks fit, until the disposal of the suit or until further orders.
Since we have discussed before the difference between temporary and
perpetual injunction and also the general principles governing the grant of
injunction it is unnecessary to repeat them, but it would suffice to note here that
a temporary injunction is granted until the disposal of the suit or until further
orders. In such a case it comes to an end when the Suit is disposed of. The effect
of a temporary injunction is explained in Rule 2(3).
(2) (1) In any suit for restraining the defendant from committing a breach of
contract or other injury of any kind, whether compensation is claimed in the Suit
or not, the plaintiff may, at any time after the commencement of the suit,
and
either before or after judgment,
apply to the court for a temporary injunction to
restrain the defendant from committing the breach of the contract or injury
complained of, or any breach of a contract or injury of a like kind arising out of
the same contract or relating to the same property or right.
(2) The court may by order grant such injunction, on such terms as to the
duration of the injunction, keeping an account, giving security, or otherwise as
the court thinks fit.
(3) In case of disobedience or breach of any such terms, the court granting
an injunction may order the property of the person guilty of such disobedience
or breach to be attached and may also order such person to be detained in the
civil prison for a term not exceeding six months, unless in the meantime the
court directs his release.
(4) No attachment under this rule shall remain in
force for more than one
year, at the end of which time, if the disobedience or breach continues, the
32. H.M. Kamajuddi n Ansari & Co. v. Union of

India, (1983) 4 SCC 417, 428. 429, 432.
property attached may be sold, and out of the proceeds the court may award
such compensation as it thinks fit, and shall pay the balance, if any, to the party
entitled thereto.
It will be seen that the effect of disobedience of an injunction is attachment
of the property of the defendant and six months' civil detention. At this juncture
one has to note that the transaction of sale or mortgage of property transferred in
breach of a temporary injunction is not void. But the alienator incurs the penalty
prescribed under Rule 2(3) above. The penalty of "attachment" of property
under the rule has a different effect from a "void" contract. In view of Section
64 of the C.P.C., any private transfer contrary to the attachment is void against
all claims enforceable under the attachment. 33 Moreover, the court has inherent
powers under Section 151 of the C.P.C. to issue injunction in cases not falling
within Order 39, Rule I and Rule 2, as decided by the Supreme Court of India
in Manohar Lal's case. 34 If the breach continues within the period of attachment
which will not remain in force for more than one year, the property attached
may be sold under Rule 4 and the court may award compensation out of the
proceeds thereof to the plaintiff. The State also may be proceeded against under
this rule as the State is a person within this rule. 35
Principles governing temporary injunctions 36
It must be made clear again that temporary injunctions to restrain a breach
of contract are regulated by the present Rule 2, Order 39 of the C.P.C., while
perpetual injunctions to restrain the breach of a contract are regulated by
Sections 38 to 42 of the Specific Relief Act. The main consideration as provided
by Section 38(2) is that a perpetual injunction cannot be granted to prevent the
breach of a contract the performance of which would not be specifically
enforced. Now the performance of a contract is not specifically enforced where
damages would afford adequate relief. However that may be, the following rules
seem to govern all cases on the subject.
W The case to be one for a perpetual injunction or for specific
performance.—As decided in Chand Sultana v. Khurshid Begum 37 , if a suit is
brought for a specitic performance of a coiiui aiid fr ar injucior'. t" r"srrin
the defendant from committing a breach of the contract, and the plaintiff applies
for a temporary injunction to prevent the breach of the contract until the suit is
disposed of, the court will decline to grant a temporary injunction if the plaint
and the affidavits filed by the parties show on the face of them that the case is
not one for a perpetual injunction or for specific performance.
Irreparable injury or incon vcnicnce.-_Consequently, to justify a case
for temporary injunction not only must the case be such that an injunction is the
Delhi and
33. Be/i Ram and Brothers v. Rem La!, ILR (1925)6 Lah 380: AIR 1925 Lah 644(2)
London Bank lid. vRam Narain, ILR (1887)9 All 497: 7 All WN 107.
34. Mane) jar La! Chopra v. Rai Bhadur Rao Raja Seth Hiram!. 1962 Supp 1 SCR 450: AIR 1962
SC 527.
35. State of Bihar v. Rani Sonabati Kumari. (1961)1 SCR 728: AIR 1961 SC 221.
36. Mulla: Civil Procedure Code, Order 39, Rule 2. pp. 802-803.
37. AIR 1963 AP 365.
appropriate relief but there must be a further ingredient that unless the defendant
is restrained forthwith by a temporary injunction, irreparable injury or
inconvenience may result to the plaintiff before the suit is decided upon its
But if a case is a proper one for specific performance, and irreparable
injury is likely to be caused unless the breach of the contract is forthwith
restrained, the court will grant a temporary injunction to restrain the breach of
contract. However, the converse of rule (a) above is not always true.
Rule 3—As per Rule 3 of Order 39, the court shall in all cases, except
where it appears that the object of granting the injunction would be defeated by
the delay, before granting an injunction, direct notice of the application for the
same to be given to the opposite party.
514Walance of convenience—The applicant must therefore show a prima
facie case for entitling him to the prayer which if not granted would cause him
irreparable injury. 39 However, the court always looks to the balance of
convenience40 which must be in favour of granting the injunction in favour of
the plaintiff.
In urgent cases or cases of great emergency where irreparable damage
would ensue if the act complained of is not restrained, injunction ex parte may
be issued. Such an injunction is also called an ad interim injun.uon because it is
issued without issuing a motion to the opposite party and continues in force only
up to the time the motion is heard. When an injunction is issued after hearing
the motion, it is called an interlocutory injunction. Thus, prima facie case,
irreparable injury and balance of convenience are the three important conditions
for obtaining an injunction.41
8. PERPETUAL INJUNCTIONS (SECTION 38)

When the plaintiff has established his right, a perpetual injunction is issued
after the trial. It holds good for ever, restrains the defendant for ever, and since it
concludes a right it is in effect a decree. It is granted where there is a question of
substantial damage which cannot be compensated by money and where a legal
duty is broken. In granting it, the court will look to the plaintiff's conduct and
the balance of convenience and consider the question from the viewpoint of
preventing multiplicity of judicial proceedings.
When granted
A perpetual injunction will be granted in the following cases:
( yto prevent the breach of an obligation,
(f3 in cases of preventing the breach of obligations arising from contract,
(h"to prevent the invasion or threat of invasion to plaintiff's right to
property or to its enjoyment.
38. Nanahha, Gnnpatrao Dhoirvgvan v. Jnnordhan Vnsudev. (1888) 12 Born 110: Mulia: Indian
Contract Act and Specific Relief Aci, pp. 263•264, citing Collette on Specific Relief Act.
39. Mogul Steamship Co. v. M Gregor Gow Co.. (1885) IS QBD 476: 53 LT 268.
40. Dohertr v. Allman, (1878) 3 AC 709:39 LT 129.
41. U.P. Avas Vik-as v. N.N. Rajgopala. (1989) All WC 494.
Though in case of waste or ouster an injunction may be granted against the

manager of a joint Hindu Family at the instance of the Coparcener, but
nonetheless a blanket injunction restraining permanently from alienating the
property of the Joint Hindu Family, even in case of a legal necessity, cannot be
granted.42
Once a perpetual injunction is granted and becoming final, any attempt to -
circumvent the same cannot be permitted. Its non-compliance would be a
continuing disobedience, entailing penal consequences.43
While granting the same, the court will consider the following and satisfy
itsellis to the conditions laid down in Section 38(3). Where there exists no
standard for ascertaining the actual damage caused or likely to be caused by the
invasion, where the ir.vasion is such that compensation in money would not
afford adequate relief, and where injunction is necessary to prevent multiplicity
of judicial proceedings, a perpetual injunction will be grant
9. MANDATORY INJUNCTIONS (SECTIONS 39 AND 40)

These injunctions are granted to prevent the breach of an obligation and
aIsoTh the purpose of compelling specific performance of certain acts which
the court is capable of enforcing. The principles underlying these injunctions are
the same as those underlying perpetual injuncti
' Iwo things have to be considered by the court before it proceeds to grant a
mat1dtory injunction, (i) what acts are necessary to be done in order to prevent
the breach of an obligation, and (ii) the requisite acts must be such as the court
is capable of enforcing. Such acts may be of various kinds. It must be noted that
a mandatory injunction can be granted even after the injury has been completed
provided the plaintiff has not lost his right to relief by delay or by acquiesc6ritcell
Where A, by the construction of new buildings obstructs light to the access
and use of which B has acquired a right under the Indian Limitation Act, B may
obtain an injunction not only to restrain A from going on with the buildings, but
also to pull down so much of them as obstructs B's light.
Section 40 provides that in a suit for perpetual injunction (Section 38) or
mandatory injunction (Section 39) the plaintiff may claim damages either in
addition to or in substitution for such injunction but the plaintiff must demand it.
It rests within the discretion of the court to allow the plaintiff to amend his
plaint for this purpose at any stage of the proceedings, but in so allowing it may
impose just and equitable terms on the plaintiff. Once his suit to prevent the
breach abovesaid has been dismissed, that will bar his right to sue for damages
for such breach, as provided by the section.
42. Sunil Kumar v. Ram Prakash, (1988)2 SCC 77: AIR 1988 Sc 576: (1988) I HLR 573.
43. Jai Da yal v. Krishan La! Garg. (1996) II SCC 588.
44. Smith v. Smith. 1875 LR 20 Eq 500: 32 LT 487.

xxv] Injunctions 445
10. IN WHAT CASES GRANTED

Looking to the list of twenty-six [(a) to (z)] examples as appended to the
unamended Specific Relief Act, 1877, Section 54, it will be clear that in a
variety of cases Injunctions are available, as (1) when there is a breach of an
obligation, either arising from contract or (ii) arising from a tort, (iii) in case of a
breach of trust, or (iv) in case of a breach of other obligations. In this connection
the observations and revelations of the Karnataka High Court 45 are very
valuable in that whenever a right exists or is created by contract, by ownership
of property or otherwise, cognizable by law, an injunction will be issued to
protect a violation of that right and the restraining power of the court extend
through the whole range of rights and duties recognised by law and would be
applied to every case of intended violation unless there are other reasons of
policy or expediency which control and limit its exercise.
(a) To maintain status quo.—Mainly,
the object of an injunction is to
maintain status quo ante. This is achieved by interlocutory or temporary and
mandatory injunction. This we saw before while discussing the difference
between temporary and perpetual injunction.
(b) To restrain judicial proceedings .—The English law, before 1873,
granted "common injunctions" to restrain proceedings opposed to principles of
equity, started in Common Law courts. This it did on the extension of the
principle contained in the maxim "equity acts in personam".
Equity had thus a
longer arm than that of the Common Law and it used this device to restrain
unconscientious proceedings even if it were started in a foreign court when an
action on the same matter was pending in an English court. The rest of the
injunctions granted by courts of equity were termed as "Special injunctions".
The Judicature Act, 1925, Section 41 enacts to this purpose and in result the
High Court has still power to restrain the proceedings in a court inferior to it. In
India, we have no separate courts and the question of 'common' injunction
therefore does not arise. However, to restrain the multiplicity of judicial
proceedings, Section 10 of the Civil Procedure Code and Section 38 of the
Specific Relief Act make provisions. The object of Section 10 of the C.P.C. is to
prevent courts of concurrent jurisdiction from simultaneously trying two
parallel suits in respect of the same matter in issue. For example,
B residing at
Calcutta has an agent A at Calicut employed to sell his goods there.
A sues B in
Calicut claiming a balance due upon an account in respect of dealings between
him and B. During the pendency of the suit in the Calicut court,
B institutes a
suit against A in Calcutta for an account and for damages caused by A's alleged
negligence. Here both the suits are between the same parties and the matter in
issue in Bs suit is directly and substantially in issue in A's suit. The Calicut
court being a court wherein a suit for the purpose is instituted prior in point of
time, that suit alone must be proceeded with. Proceedings with the Calcutta
court must therefore be stayed. The section applies to courts in India and a suit
45. Shawari In! v. S. Jaichand. AIR 1975 Kant 122, 123: ILR 1975 Kant 127.
446
in a foreign court does not provide a ground for staying a subsequent suit in a
court in India.46
(c) To prevent breach of a duty or an obligation.—(i) Contractual
Obligations.—Many cases of injunction fall under this category. In this class of
cases, obligations arise by express or implied agreement, i.e., by a contract
between the parties. While granting an injunction under Section 38 and Section
42 the court will look to the provision under Section 41(e) also wherein it is
expressly stated again as under Section 38(2), that in such cases the court is
guided by the rules in Chapter II regarding specific performance of contracts.
That is to say, (1) no injunction can be granted in case of contracts, the specific
performance of which cannot be granted. However, Section 42 allows it in
certain cases. Accordingly, those contracts could be ordered to be specifically
performed wherein money compensation is not an adequate relief: and such
cases are those where the defendant invades or threatens to invade the plaintiffs
right to, or enjoyment of property. Perpetual injunctions will be granted in such
cases. Conversely, where the breach is such as can be compensated by money,
injunction will be refused. Similarly, contracts involving personal skill,
violation, etc., and those contracts the specific performance whereof gain for the
plaintiff an unfair advantage over the defendant and indefinite contracts will not
be specifically enforced and consequently no injunction would be granted. (2)
But an injunction can be granted against a person who aids a breach of
contract .47 (3) injunction, as follows from Section 38(2) and (3), will be granted
in almost all cases falling under clause 3(a) to 3(d) where the plaintiff proves his
right to or enjoyment of the property and its breach, actual or threatened, by the
defendant. Consequently, against the breach of a patent right, copyright and
trade mark 48 , it is granted as it is a breach of property right. Against libel,
wrongful expulsion from a club-membership 49 , for invasion of airspace and
continuing trespass-' O , for causing injury to plaintiff, for causing him
annoyance 52 , for breach of easementary rights 53 and for wrongful exclusion
from the affairs of partnership, injunction will be granted. For breach of trust
and waste of property and agaiusi picvciiiwn of uizi, icc thc act involves
injury to property injunction, can be granted.
Injunction to Perform Negative Agreements (Section 42).—A contract may
contain positive as well as negative terms. When the question of specific
performance is raised it becomes important to discuss whether all the terms of a
contract will be specifically enforced or only the positive or negative terms.
Section 42 solves this problem. For example, A contracts with B to sing for
..twelve months at B's theatre and not to sing in public elsewhere without his
46. Sce Mulla: Civil Procedure Code, p. 20 and also 0. 41, R. 5 for stay of execution proceedings.
47. Rookes v. Barnard, 1964 AC 1129: (1964) I All ER 367 (UL).
48. Exite Laboratories v. A.A. Products (hid.), AIR 1989 NOC 218 (Del).
49. Lawlor v. Union of Post Office Workers, 1965 Ch 712: (1965) 1 All ER 353 (Ch D).
50. Mootchand v. Chhoga, AIR 1963 Raj 25.
SI. Darshan Ram v. Nazar Ram, AIR 1989 P&H 253.
52. St. Joseph Church v. Velu, AIR 1989 NOC 124 (Kcr).
53. Prem Devi v. Sohanlal, AIR 1989 NOC 176 (Raj).
written permission. Thereafter, A makes a breach of the contract. B cannot

obtain specific performance of the contract to sing, but he is entitled to an
Injunction restraining A from singing at any other place of public
entertainment.54
Against this judgment there has been much criticism and the English
authorities have distinctly refused to go so far, saying that an affirmative
agreement does not of itself imply for this purpose a negative agreement to do
nothing inconsistent with it 55 ; and whether an express agreement is affirmative
or negative is a matter of substance and not of verbal form.
In India, in the case of negative convenants, even in cases where the service
is not of special or specialised character, injunctions are granted in suitable
cases. 57 In Vinod Chandra HiraM! Gandhi v. Vivekanand Mills Lid. 58 , the
Gujarat High Court has held that a negative convenant must be distinct and a
mere affirmative stipulation is insufficient to comply with such a negative term.
Consequently, a term in a contract of employment to serve for a particular
number of years does not imply not serving anyone else during that period. But
the Madras High Court has differed from this view. 59 But one thing has to be
noted here that the remedy of injunction is discretionary and cannot be claimed
as a matter of right. Where the plaintiff has entered into a contract under
circumstances which give him an unfair advantage over the defendant within the
meaning of Section 20(2)(a). injunction will not be granted. 60 Moreover, no
injunction will be granted in case of an express negative convenant relating to
contracts for personal service if its effect is to compel the performance of the
service or to remain idle.6'
It must be said therefore that in India provisions of Section 42 are far more
ahead of the English principle as expressed in Lumley v. Wagner. It does not
require a negative agreement to be express as in Lumley v. Wagner. Such an
agreement may be implied as in Burn & Co. v. McDonala 2, wherein the
defendant agreed diligently and to the best of his ability to devote himself to the
duties incumbent on him as a draftsman etc. for a period of five years. It was
held that though there was no negative condition in terms in the contract, a
negative convenant could properly be implied under this section and an
injunction to restrain the defendant from serving any other person during the
period was granted.
54. Lumley v. Wagner (1852) 1 Dc GM&G 604: 22 U Ch 898.

55. Whitewood Chemical Co. v. Hardman, (1891) 2 Ch 416: 64 LT 716.
56. Metropolitan Electric Supply Co. Lid. v. (5i,rder, (1901)2 Ch 799:84 LT 818.
57. Sun,lchand C. Mazumdar v. Aryodava Spy. & Wvg. Mills Co. Lid., AIR 1964 Guj 115: ILR
1963 GUJ 89t.
58, AIR 1967 Guj 255.
59. Mac Laboratories (P) Lid. v. V.R. Nathan, (1967) 1 Mad Li 353 cf. V.N. Deshpande v. Arvind
Mills Co. Ltd., ILR 1946 Born 89: AIR 1946 Born 423.
60. Callxanji Harjivan V. Narsi Tricuin, ILR (1895) 19 Born 764.
61. Pollock and Mulla: Indian Contract Act and Specific Relief Act,
pp. 963-964. Sec also Lalbhai
Dalparbhai Co. v. Chittaranjan Chandulal Pandya, AIR 1966 Guj 189; Niranjan Shankar
Golikart v. Century Spinning and Manufacturing Cu. Lid., AIR 1967 SC 1098, 1104.
62. ILR(1909) 36Ca1 354: 1 IC 829.
Even in cases not arising out of contracts of personal service negative

stipulations have been implied and injunctions granted. But it all depends upon
the Court's discretion and considerations of fairness, as expressed in a value-
judgment by Bhagwati, J. in Lalbhai Dalpatbhai & Co. v. Chirtaranjan
Chandulal Pandya.63
Summing up the topic we may say that (i) where a contract comprises an
affirmative agreement to do a certain act coupled with a negative agreement,
express or implied, not to do a certain act, the court may be unable to enforce
the positive or affirmative part of it by specific performance because of personal
service or qualifications etc. required for its performance. (ii) But the court will
enforce the negative agreement not to do a certain act. (iii) As per English law,
the negative part could be enforced only if it is clear and distinct as was the case
in Lumley v. Wagner, but (iv) if the terms are implied Injunction cannot be
granted. That is to say, in England if the negative terms are implied in the
positive terms of a contract, injunction for the breach of a negative term cannot
be given. This is the limit of the English law and the courts there, are not
prepared to go further. (v) But in India Section 42 of the Specific Relief Act
goes further than this and provides that "the circumstance that the court is
unable to compel the specific performance of the affirmative agreement shall
not preclude the Court from granting an injunction to perform negative
agreement", and the negative terms may be express (as insisted upon by English
law) or it may be implied (as provided by our law). 61 This is the present
situation and the solution finally rests within the court's discretion.
(ii) Obligations arising under General Law.—In this class one comes across
(1) cases regarding obligations arising under a trust, (2) obligations arising out
of a breach which amounts to a tort which in turn includes a number of civil
wrongs65 , and (3) any other obligation legal or equitable.
(1) Trust obligations: As we have seen in previous chapters a trust is a
matter of obligation and the duty lies heavily on a trustee who undertakes the
responsibilities that he should not make a breach of trust. A trustee may
consequently be restrained by an mjiincion from se!!ir.g trust pro crtyiiere ii
is not necessary to do or where he is not authorised by law or by an instrument
of trust. In such cases the question of adequate compensation for the breach
complained of may not arise. A breach of confidence can well be restrained as
was ruled in a number of English and Indian cases. As expressed by Hanbury,
there are examples of the issue of an injunction to restrain a breach of an
equitable obligation. Trustees have been restrained from distributing an estate
inconsistently with the terms of the instrument 67 or from selling for a price
63. AIR 1966 Guj 189. See also Niranjan Shankar Golikari v. Century Spinning and
Manufacturing Co. lid., AIR 1967 Sc 1098.
64. Burn & Co. v. McDonald, ILR (1909) 36 Cal 354: I IC 829.
65. Torts affect a person, his reputation and his property. There are also torts affecting both a
person and his property.
66. Modern Equity, 9th edn., 1969, pp. 74-75.
67, Fox v. Fox, (1870) IR 11 Eq 142:23 LT 584.
XXV] injunctions 449
below that offered firmly by a prospective purchaser and an injunction was

granted to restrain a bankrupt executor from acting 69 and to restrain the
publication by students of the unpublished lectures of a university professor-70,
and at the instance of a shareholder to restrain a company from disposing of an
exceptionally large sum for the benefit of employees. 7 ' Old Section 54 of the
Specific Relief Act, 1877, illustrations (b) to (h) supply enough like examples as
where an injunction can be issued for a threatened breach of trust against the
trustees, and against the directors of a company paying dividend out of capital
or borrowed money or when they undertake a new adventure in a different line
of business, against an executor's misconduct and against an advocate
threatening to reveal his cljent's 72 secret,
(2) Civil wrongs or Torts: As Maitland remarks, "a very large part of the
whole province of tort is a proper field for injunction. I should say that the only
torts which lie outside the field of injunctions are assault and battery, false
imprisonment and malicious prosecution. I do not think that an injunction has
been used or could be used to prevent these torts, which if they be torts will also
at least in most cases be crimes. Here there are other remedies. If you go in fear
of a man you can have him bound over to keep the peace, while if you are
wrongfully imprisoned the writ of habeas corpus with its rap1u procedure should
serve your turn. A civil court again must not prohibit a man from instituting
criminal proceedings, the Attorney General's nolle prosequi should be sufficient
preventive check on criminal of an obviously vexatious kind". 73 Nuisance74,
trespass, waste of property and defamation in this connection are the fields
wherein this remedy is often resorted to. Generally damages are recovered but
where necessary, in suitable cases, injunctions can be availed of as a safeguard
against future wrongs i.e., quia tirnet action.
(3) Any other obligation Legal or Equitable:
Under this class may be
included the obligations arising by virtue of membership of an association. Thus
injunctions have been granted to professional men who have been dismissed
contrary to the rules of their profession, though usually only where improper
motive or bad faith can be shown 75 and to members expelled by social clubs. In
the latter case, however, the courts seem prepared to interfere not only where
rules have been broken, but also where a club has acted in breach of natural
justice. In L.aboucl,ere case 76 the general meeting of a club, summoned without
68. Buttle v. Saunders. (1950)2 All ER 193 (Ch D).

69. Bowen v Ph illips, (1897) 1 Ch 174; 75 LT 628,
70. Cajrd v. Sime, (1887) 12 AC 326; 57 LT 634 (HL).
71. Parke v. Daily News lid., (1961) 1 WLR 493: (1961) 1 All ER 695 (Ch. D).
72. Fraser v. Evans, (1969) 1 All ER
8: (1969) 1 QB 349 (CA); District Board v. Kailash Nat/i
Kapoor, ILR 1946 All 21: AIR 1946 All 234, National Broach & Machine Co.
V. Churchill,
Gear Machines, lid., (1965) 2 All ER 961 (CA).
73. Maitland: Lectures on Equu'v, 1969, p. 325.
74. Dar.shan Ram v. Nazar Ram, AIR 1989 P&H 253: Si. Joseph Church v. Velu.
AIR 1989 NOC
124 (Kcr).
75. Weinberger v. /ng(i.c, 1919 AC 606; 121 LT6S(HL).
76. La&azjchr,. v. Wharwlsffe (Earl). (1879) 13 Ch D 346; 41 LT 638, cf. Dawkins v. Antrobus,
(1881) 17 Ch 1)615: 44 LT 557 and see Young v. Ladies' imperial
Club. (1920) 2 KB 523:
450 Equity, Trusts and Specific Relief Lchap.
proper notice, expelled the plaintiff without full inquiry, without giving him
notice of any definite charge and by a resolution carried by an insufficient
majority. The court granted an injunction against such purported
expulsion. 77 In such cases important considerations that weigh with the
court granting injunction are those incorporated in clause (3)(b), (c) and (d)
of Section 38.
11. INJUNCTION WHEN REFUSED (SECTION 41)
The provisions of S. 41 in this regard are clear. As observed in Cotton
Corporation of India Ltd. case 711, the equitable principle underlying Section
4 1(b) is that access to the Court in search of justice according to law is the right
of a person who complains of infringement of his legally protected interest and
afortiori therefore, no other court by its action impede access to justice, except
the Superior Court, which can injunct a person by restraining him from
instituting or prosecuting a proceeding before a Subordinate Court. Section
41(b) was enacted in order to avoid multiplicity of proceedings. It must
therefore receive such interpretation as would advance the intendment and
thwart the mischief it was intended to suppress and keep the path of access to
justice through court unobstructed. S. 41(b) covers perpetual as well as
temporary injunctions.79
In the following cases injunctions are refused:
(1) to restrain judicial proceedings,
(ii) to stay proceeding in a court not subordinate to the one issuing
injunction,
(iii) to stay proceedings in a criminal court by civil court.
(iv) to restrain persons from applying to any legislative body,
(v) to prevent breach of a contract not specifically enforceable,
(vi) to restrain on act which is not clearly a nuisance,
(vii) to prevent a continuing hrer}' ''here paiiitiff has acquiesced,
(viii) where plaintiff has equally efficacious remedy,
(ix) where plaintiffs conduct disentitles him, and
(x) where the plaintiff has no personal interest in the matter.
Section 43 is an amendment to the Arbitration Act and Section 44 repeals
the Specific Relief Act, 1877.
1965 Ch 712: (1965) 1 All ER

123 LT 191 (CA) and Lawlor v. Union of Po-%1 Office Workers,
353 (Ch D).
77. Hanbury: Modern Equity, pp. 80-81.
78. Cotton Corporation of India Ltd. v. United Industrial Bk. Ltd., (1983) 4 SCC 625: AIR 1983
SC 1272.
79. Ibid.
Grant of injunction may be refused where the defendant's act cannot be

construed as an act of dispossession.80
A civil court has no jurisdiction to try and adjudicate upon an industrial
dispute, if it concerned enforcement of certain rights or liability created only
under the Industrial Disputes Act. It therefore cannot grant an injunction.8'
80. MS. Baliga (decd. b y LRs.) V. Mangalore City arpa., AIR 1998 Kant 76.
Preger Aw,nuthile Ltd. v. Kanuleicar Shaniaram Wadke. (1976) I SCC 496: 1976 SCC
81. Premier
(l.&S) 70: AIR 1975 Sc 2238.

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Chapter XX

Obligations in the Nature of Trust

(a) A conveys certain land to B—

2. (a) RESULTING TRUSTS (SECTIONS S3-85)

(b) CONSTRUCTIVE TRUSTS (SECTIONS 86-94)

considered as an asset in his hands because his debt is not extinguished

3. Re Roc/lemocauld (1897) I Ch 196.

I. Oxford Companion to Law, 1980. p. 469.

It is an inflexible and settled rule of equity that a person in a fiduciary

Whenever two persons stand in such a situation that confidence is

Some important aspects of this relationship maybe laid down as under:

4. Sec Rega1(1a.Tings) Lid. v. Gut/Ever, (1942) All ER 378.

9. (1942) All ER 378.

(8) Parent and child,19

19. Brahma Raj Singh v. B.R. Devi, AIR 1982 HP 87.

These transactions may fall in various broad categories like commercial

Specific relief, as form of judicial redress, belongs to the law of procedure,

Besides, discovery of documents, suits for perpetuation of testimony,

4. SPECIFIC RELIEF ACT, 1963; SCItEME

6. Whitely Stokes quoted in Woodroffe on Injincnons.

Recovering Possession of Property

3. RECOVERY OF SPECIFIC IMMOVABLE

2. Krishna Kishore Firm v. Got. of A.?.,

In Alexander case 9, the plaintiff brought a suit for possession of lands

9. Nair Service Society Ltd. v. K.C. Alexander, AIR 1968 SC 1165.

juridical possession, however that cannot be termed as lawful

unlawful means for dispossessing a person. The position of a licensee

21. East India Hotels Lid.. supra.

28. Ibid., p. 96.

46. ILR (1946) Mad 174: AIR 1945 Mad 281.

366 Equity, Trusts and Specific Relief I Chap.

13. When contract cannot be cnl'orccd (a) Compensatory Relief (Sections 21

thoroughly as possible for Indian purposes. Where there is an express

Con rractx which can be Specifically Enforced

(b) does not admit of compensation in money;

EvplafintionFor the purposes of this section, a party to a contract shall be deemed to be

Contracts which cannot be Specifically Enforced

Persons for or against whom Contracts may be Specifically Enforced

Enforcement of Awards and Directions to Execute Settlements

5. GENERAL PRINCIPLES FOR GRANTING

8. Hutton v. Wailing, 1948 Ch 26: (1947)2 All ER 641 (Ch D).

breach.'° The equitable principles which regulated the grant of specific

10. Hashani v. Zenab, 1960 AC 316: (1958) 3 All ER 719 (PC).

Reciprocal Remedy.—This remedy is a mutual or a reciprocal remedy

20. ILR (1912) 39 Cal 232 (PC): 39 IA I.

TCon tracts of personal services—Cannot be s pecifically

6. APP LICABILITY OF ENGLISH PRINCIPLES IN INDIA

33. Page One Records tad.. V. Brion, (1968) 1

S. DEFENCES TO AN ACTION FOR SPECIFIC

37. 27th Edn., 1972, Part VII, Chap. I, pp. 583-600,

39. Jervis v. Berridge, (1873) 8 Ch App 351: 28 LT 481.

45. (1842) I Y & C Ch Cas 627: 62 ER 1046.

(c) Mistake and Misrepresentation

improvident in its nature, shalt not he deemed to constitute an unfair advantage

55. (1895)22 IA 153: ILR (1896)23 Cal 15 PC.

59. Sultan v. Sharfan, 113 IC 140(DB): AIR 1929 Lah 249.

B. TIME WHEN ESSENCE OF THE CONTRACT7°

74. AIR 1948 PC 192: 1948 Mad WN 121.

82. Bancrjce: Law of Specific Relief, edn. 9, 1992,