SPECIFIC RELIEF ACT 1963.

QUESTION ANSWERS

Q. What is specific performance of contract?

Ans. Specific performance means enforcement of exact terms of the contract. Under it the plaintiff
claims for the specific thing of which he is entitled as per the terms of contract. For example, if A
agrees to sell certain shares to B of a specific company which are limited in number and after the
payment made by B, if A refuses to sell the shares then B is entitled to recovery of those shares.

Specific performance of a contract means performing the contract as per the terms and conditions
agreed to between the parties to it, rather than payment of damages or consequences, for the non
performance of the contract.

Under it the plaintiff claims for the specific thing of which he is entitled as per the terms of contract.
Specific performance is an equitable remedy in the law of contract, whereby a court issues an order
requiring a party to perform a specific act, such as to complete performance of the contract. Specific
performance is commonly used in the form of injunctive relief concerning confidential information
or real property

Q. Under which Act it is dealt with?

Ans. The Specific Relief Act, 1963, specifically Chapter II of the Act deals with specific
performance of a contract. It also lays down the types of contracts which cannot be specifically
enforced as well as persons for or against whom contracts may be specifically enforced.

Q. When could the court grant the decree for Specific performance? OR When may the Court order
specific performance of contract?

Ans. The court may order specific performance of contract in the following –

1. Specific performance of contracts connected with Trusts enforceable – Under Section 11

of the Specific Relief Act 1963, except as otherwise provided in the Act, Specific
performance of contracts is enforceable in the discretion of the court, where the act agreed
to be done is in the performance wholly or partly of a Trust, provided the contract made by
a trustee is neither in excess of his powers nor in breach of trust.
2. Specific performance of part of contract under exceptions to Section 12 – Under Section
12 (1) the general principle is that the court shall not direct the specific performance of part
of a contract. However in the following three cases , the court may order specific
performance of part of a contract –
i. Under Section 12 (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.
ii. Under Section 12 (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 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 –
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
in a case falling under Clause (b) 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 right to
compensation, either for the deficiency or for the loss or for
the damage sustained by him through the default of the
defendant.
iii. Under Section 12 (4), when a part 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.
Q. Which contracts are not specifically enforceable? OR when may the court refuses to order
specific performance of a contract?

Ans. Under section 14 the following contracts cannot be specifically enforced, namely –

a) Where a party to the contract has obtained substituted performance of contract in

accordance with the provision of Section 20.
b) A contract, the performance of which involves the performance of a continuous duty which
the court cannot supervise.
c) A contract which is so dependent on the personal qualifications of the parties that the court
cannot enforce specific performance of its material terms and
d) A contract which is in its nature determinable.

Section 16 provides for 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 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 the
performance of which has been prevented or waived by the defendant.

Section 17 (1) provides that a contract to sell a let any immovable property, cannot be specifically
enforced in favour of a vendor or a lessor –

a) Who knowing himself not to have any title to the property, has contracted to sell or let the
property
b) Who though has 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 contract for the completion of the sale or
letting, give the purchaser on lessee a title free from reasonable doubts.

Subsection (2) of Section 17 provides that the provisions of Sub section (1) shall also apply, as far
as maybe, to the contracts for the sale or hire of movable property.

Q. When can an injunction be granted by the Court?

Ans. Under Section 38 Subsection (1), a perpetual injunction maybe granted to the plaintiff to
prevent the breach of an obligation existing in his favour, whether expressly or by implication.

Subsection (3) of Section 38 provides that when the defendant invades or threatens to invade the
plaintiff’s 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 exist 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.

Section 39 provides for mandatory injunction. Under section 39 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.

Q. In which year the Specific Relief Act is enacted?

ANS. The Specific Relief Act was enacted by the Parliament of India in the year 1963. The Act
came into force on 13th December 1963 replacing the old Specific Relief Act 1877.

The object of the Specific Relief Act 1963 is to give the party seeking Specific Relief of protection
of some civil right or the prevention of some civil wrong.

Q. Who may obtain specific performance?

Ans. According to Section 15 of the Specific Relief Act 1963, specific performance of a contract
maybe obtained by the following persons –

1. Any party to the contract may obtain specific performance of that contract. A contract is
an agreement enforceable by the law.
2. A representative in interest or the principal, of any party thereto. Representative in interest
includes any assignee or transferee of interest or a legal representative i.e. executor or
administrator, after the death of the principal.
A legal representative may sue provided that the contract is not dependent on the personal
skill or quality of the promisee. If the contract depends on the personal skill or quality of
the parties, for instance – a contract to paint a picture, or write a book, The duty under the
 contract ends by the death of the party and the legal representative cannot claim specific
performance.
3. A beneficiary under the contract may obtain specific performance of the contract, where
the contract is a settlement on marriage, or a compromise of doubtful rights between the
members of the same family.
4. Where the contract has been entered into by a tenant for life in due exercise of a power, the
remainderman can specifically enforce the contract.
5. A reversioner in possession may require specific performance, where the agreement is a
covenant entered into with his predecessor -in- title and the reversioner is entitle to the
benefit of such covenant.
6. A reversioner in remainder may specifically enforce the contract, where agreement is such
a covenant and the reversioner is entitled to the benefit thereto and will sustain material
injury by reason of its breach.
7. When a limited liability partnership has entered into a contract and subsequently becomes
amalgamated with another limited liability partnership, the new limited liability
partnership which arises out of the amalgamation.
8. When a company has entered into a contract and subsequently becomes amalgamated with
another company, the new company which arises out of the amalgamation can specifically
enforce the contract.
9. 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 may specifically enforce the contract: Provided that the
company has accepted the contract and has communicated such acceptance to the other
party to the contract.

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