Remedies available under Specific Relief Act, 1963

By | August 2, 2018
Remedies available under Specific Relief Act, 1963

INTRODUCTION

In order to provide reliefs in cases relating to contracts, torts and other cases Specific Relief Act, 1877 was enacted. This legislation had become necessary because the Indian Contract Act,1872 provided only the relief of compensation in case of breach of contract. It was found that there might be situations wherein the grant of compensation would not afford adequate relief and only specific performance of the contract would render justice and provide adequate relief. It replaced an earlier Act of 1877. The Act of 1877 was drafted by Whitley Stokes and revised by the Law Member, Sir Arthur Hobhouse. The Act embodied equitable principles which were developed in England by equity courts and had been already applied by Indian courts as principles of justice and equity. The Report of the 9th Law Commission detailed the reasons for revising the Act of 1877 briefly. Numerous other flaws in the Act of 1877 were highlighted and thus, succeeded it with the Specific Relief Act of 1963.

The following kinds of remedies may be granted by a court under the provisions of the Specific Relief Act:

  • Recovery of possession of the property
  • Specific performance of contracts
  • Rectification of instruments
  • Rescission of contracts
  • Cancellation of Instruments
  • Declaratory decrees
  • Injunction

RECOVERY OF POSSESSION

The provisions contained in Chapter 1 are relating to both immovable and movable property. Section 5 and 6 deal with specific immovable property and sections 7 and 8 deal with movable property.

IMMOVABLE PROPERTY

The two provisions are based on title and possession described under Section 5 and 6 respectively.

Section 5 of the Act states :

“A person entitled to the possession of the specific immovable property may recover it in the manner provided by the Code of Civil Procedure,1908(5 of 1908).”

It states that a suit for possession must be filed having regard to the provisions of CPC. In Dadu v. Dayala Mahasabh, it was held that since the statute provides for applicability of the Code, there cannot be any doubt whatsoever that all the provisions thereof shall apply.

SUIT BY PERSON DISPOSSESSED OF IMMOVABLE PROPERTY

Section 6 of the Act provides:

(1) 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 suing to establish his title to such property and to recover possession thereof.

This section provides for two principles. First, that the disputed rights ought to be decided in the due course of law and not otherwise. The second principle is that if a person is in possession of some property, then existing possession ought to be protected notwithstanding any other title that may be set up in the suit. The procedure for recovering possession of specific immovable property is the same a`s provided in Civil Procedure Code.

RECOVERY OF POSSESSION OF SPECIFIC MOVABLE PROPERTY

Section 7 states:

A person entitled to the possession of specific movable property may recover it in the manner provided by the Code of Civil Procedure Code, 1908.

This section explains that a trustee may sue under this section for the possession of the movable property to the beneficial interest in which the person for whom he is a trustee is entitled.

In Chandu Naik and others v. Sitaram B. Naik and another, it was held that when the dispute is between two private parties in respect of possession of premises, the provisions of section 8 of the Act are not attracted and the Civil Court has the jurisdiction to entertain and try the suit of the kind with which we are dealing.

Section 8 states:

Liability of person in possession, not as owner, to deliver to persons entitled to immediate 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;

(d) 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—

(a) That compensation in money would not afford the plaintiff adequate relief for the loss of the thing claimed, or, as the case may be;

(b) That it would be extremely difficult to ascertain the actual damage caused by its loss.

Section 8 of the act attaches more importance to the title than possession.

Geetarani Paul v. Dibyendra Kundu  (AIR 1991 SC 395) – The Supreme Court has held that as long as the plaintiff is able to substantiate and establish that he is lawful and registered owner of the suit lands and the title vests in him, specific details of his dispossession need not be proved and that a decree on the basis of the title can follow, if the suit is filed within the period of limitation

SPECIFIC PERFORMANCE OF CONTRACT

The provisions relating to specific performance of contracts are contained in Chapter 2 of Part II of Specific Relief Act, 1963.

Section 9 of the Act provides :

Except 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 defense any ground which is available to him under any law relating to contracts.

This section makes it clear that in a case relating to specific enforcement of the contract, the defendant can take all those defences which are available under any law relating to contracts.

In Sanjib v. Santosh (AIR 1922 Cal 436), it was held by this Court that on such an agreement a suit for specific performance could not be founded even though the tenant was put in possession in pursuance of the said agreement as the document was hit by Section 49.

Section 10 of the Act provides :

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 actual damage caused by the non-performance of the act agreed to be done; or

(b) 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 an 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;

(b) where the property is held by the defendant as the agent or trustee of the plaintiff.

According to the explanation of Section 10, unless and until the contrary is proved, the court shall presume that in a breach of contract for the transfer of immovable property, compensation in money will not afford an adequate relief.

In Krishan v. Krishnan S/o Kizhakkum-brath Arumugha Tharakar (AIR 1993 Kerala 134), it was held where the agreement to sell the property was by three co-owners, the suit can be specifically enforced against one of the co-owners in respect of his share.

Section 11 of the Act provides :

Cases in which specific performance of contracts connected with trust enforceable

(1) 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.

This section corresponds to Section 12(a) and 21(e) of the repealed Act of 1877.

Section 12 of the Act provides :

Specific performance of part of contract

(1) 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 by 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; or

(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 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-

(i) 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 a case falling under clause (b), 2[pays or had paid] the consideration for the whole of the contract without any abatement; and

(ii) in either case, relinquished all claims to the performance of the remaining part of the contract and all right to compensation, either for the deficiency or for the loss or damage sustained by him through the default of the defendant.

(4) When apart of a contract which, taken by itself, can and ought to be specifically performed, 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.

Explanation: For 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.

It states that the Court shall not direct the specific performance of a part of the contract unless it can enforce the contract.

Section 13 of the Act provides :

Rights of purchaser or lessee against person with no title or imperfect title

(1) Where a person contracts to sell 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 the contract 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.

It states that a contract can still be enforced even when the person has no or an imperfect title and he shall have the rights mentioned above.

Section 14 : Contracts not specifically enforceable

(1) The following contracts cannot be specifically enforced, namely,-

(a) a contract for the non-performance of which compensation is an adequate relief;

(b) a contract which runs into such minute or numerous details or which is so dependent on the personal qualifications 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;

(d) a contract the performance of which involves the performance of a continuous duty which the court cannot supervise.

(2) Save as provided by the Arbitration Act, 1940, no contract to refer present or future differences to arbitration shall be specifically enforced; but if any person who has made such a contract (other than 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 existence of such contract shall bar the suit.

(3) Notwithstanding anything contained in clause (a) or clause (c) or clause (d) of sub-section (1), the court may enforce specific performance in the following cases:

(a) where the suit is for the enforcement of a contract,-

(i) to execute a mortgage or furnish any other security for securing the repayment of any loan which the borrower is not willing to repay at once:

PROVIDED that where only a part of the loan has been advanced the vendor 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;

(b) 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 is for the enforcement of a contract for the construction of any building or the execution of any other work on land:

PROVIDED that the following conditions 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.

In Executive Committee, State Warehousing Corporation v. Chandra Kiran Tyagi, the Supreme Court held that ordinarily the contracts for personal services cannot be specifically enforced subject to certain exceptions.

Section 15 of the Act provides :

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 be 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;

(d) Where the contract has been entered into by a tenant for life in due exercise of a power, the reminder man;

(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;

(f) 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.

A person, who sues for specific performance of an agreement, will have the burden of proving the same.

SECTION 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

(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 willfully 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 the performance of which has been prevented or waived by the defendant. Explanation.—for the purposes of clause (c),—

(i) 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.

It was observed in N.P. Thirugnanam v. Dr. R.J. Mohan Rao that where it is clear from the evidence that the plaintiff was not “ready and willing” to perform his part of the contract, he would not be entitled to get the decree of specific performance.

RECTIFICATION OF INSTRUMENTS

The act allows the Court to issue orders for rectification of documents executed in mutual mistake of the parties.  The provision relating to rectification of instruments is contained is Section 26 of the Act. The rectification of the instrument can be made on the ground of mistake of law.  According to clause 1, if on account of the mistake the instrument does not express the intention of the parties, then either party or his representative may institute a suit to have the instrument rectified.

Shanti Ranjan Das v. Dasuram (AIR 1957 Assam 49) – In the said decision it was held that even a representative in interest may apply for rectification. However, such rectification cannot affect the right of the third party.

Raipur Mfg. Co. Ltd. v. Joolaganti Venkatasubba Rao Veerasamy & Co. (AIR 1921 Mad 664) – It was held that where in the course of a suit for damages for breach of contract, the plaintiff contends that if there is a clerical error in the document embodying the contract, it is not always necessary that a separate suit should have been brought for rectification of the document and it is open to the court in a proper case to allow the plaintiff to amend the plaint and ask for the necessary rectification

RESCISSION OF CONTRACTS

The provisions relating to rescission of contracts are contained in Sections 27 to 30 of Chapter IV of Part II of the said Act.

In Prem Raj v. D.L.F.M Co. Ltd., it was held that a person who sues for rescission of contract cannot claim alternative relief of specific performance but a person who files the suit for specific enforcement can alternatively claim for rescission of the contract.

In Hari v. Naro, it was held that where the parties are equally at fault, the provisions of clause 1(b) will not apply.

CANCELLATION OF INSTRUMENTS

The provisions relating to cancellation of instruments is given in Sections 31 to 33 of the said Act. Any person who has a reasonable apprehension that an instrument may cause him injury may sue to have it adjudged and the Court can order the cancellation on merit. The contract must be in writing and it must be void or voidable according to Section 31.

Tulsi Nagar Vikas Samiti v. Bhuvensawer Kumar Agarwal & Ors (2012), the issue is regarding the JDA’s jurisdiction to cancel a registered lease-deed contrary to the provisions of the Specific Relief Act (Section 31) and without as much as complying with the principle of natural justice. But the petition was dismissed.

Prem Singh vs. Birbal (2006 (5) SCC 353) , the Supreme Court pointed out in para 16 that “when a document is valid, no question arises of its cancellation” and that “when a document is void ab initio, a decree for setting aside the same would not be necessary, as the same is non est in the eye of law”

DECLARATORY DECREES

Provisions relating to declaratory relief are given in Section 34 and 35.

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.

The person filing the suit must be entitled to a legal right or any right as to any property. However, the passing of a declaratory decree is a matter of discretion of the court and it cannot be claimed a right.

In V.R. Reddy v. Konduru Seshu Reddy, the Supreme Court held that Section 42 of the Specific Relief Act is not exhaustive of the cases in which a declaratory decree may be made and the Courts have the power to grant such a decree independently of the requirements of that sections.”

PREVENTIVE RELIEF – INJUNCTION

Section 36 states that :

Preventive relief is granted at the discretion of the court by injunction, temporary or perpetual.

The injunction is a specific order of the Court whereby it prohibits a wrongful act or enacts in a wrongful course which has already commenced or cases it direct the things to be restored in their prior state.

An Injunction can be temporary or perpetual.

In Pirthi v. Mohan Singh, it was held that if the plaintiff abuses the process of Court and approaches Court with clean hands, the suit for the permanent injunction will be liable to be dismissed.

In a suit for mandatory injunction, the burden of proof lies on the plaintiff. It was held in Shankar Kumar v. Mohanlal Sharma, relief cannot be given on the ground that the defendant failed to prove his case.

– Shubhi Pandey

(R.D.V.V)

Sources

  • Contract-I and Specific Relief Act by Dr. S.K. Kapoor
  • Specific Relief Act, 1963

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