Law Relating To Equity

BY-YOGESH BHADANA MOB-8684864304
LAW RELATING TO EQUITY, TRUST AND SPECIFIC RELIEF

NOTES-(9TH SEM.)
UNIT-I
Equity:
The Origin and Development of Equity:
(a) The Medieval period lasting until 1672;
(b) The Period of Transformation
(c) The Modern Period.
(a) The Medieval Period - In England, the history of Equity can be
traced from the time of Norman Conquest. After the Norman Conquest
a royal court known as Curia Regis came into existence. It was the
group of skilled administrators. In its early time the Curia Regis was
concerned with the matters of King's own interest such as collection of
revenue. But in due course of time this Curia Regis became the court of
law also in which the suits of private parties could be decided and the
Common Law of England took place of the various Customary rules. In
thirteenth century, in the reign of Edward I the so-called Common Law
took a definite shape. By the end of thirteenth century there were the
following three great Courts of England :
(i) The King's Bench;
(ii) The Common Bench or the Court of Common Pleas; and
(iii) The Exchequer.
The law formulated, developed and administered by these three courts
was the Common Law based on the State Law and the customary Law.
Out of these there courts, the Exchequer was not only a Court of Law
but it was also an administrative Department of the Government. Its
Secretariat Department was known as chancery. The head of chancery
was called Chancellor who was the King's Secretary for all department
and kept the King's Seal and all writing work in King's name were done
under his supervision.
The common law was deficient in the following three respects :
(1) Remedy was not available in all cases for many wrongs as remained
underdressed for want of proper writs. The number of writs was very
small and many claims could not be brought under any them.
(2) The relief granted by the common law courts was not always
adequate. They gave relief only in damages, for breach of a contract
but did not provide for specific performance. Reliefs such as injunction,
accounting, appointment of receiver were outside the jurisdiction of
the common law courts.
(3) And lastly, being a reminiscence of the feudal period the procedure
in the common law courts was defective and unsatisfactory; it was very
cumbrous and formal.
In 1285, the Parliament of England made an attempt to remove the
deficiency of the Common Law through the Statute of West-minster. It
was commonly known as Consimili Casu. This Statute empowered the
Chancery to invent new writs for certain cases which were similar to
those for which there were appropriate writs in vogue. But in cases
where the Chancellor wanted to issue new writs, he had to seek the
consent of the King-in-Council. As this Statute gave only a limited
power and was confined to writs in Consimili Casu, the deficiencies in
Common Law could not be removed. With the result there was
enhancement in the number of petitions to the King "for the love of
God and in the way of charity." These petitions were made to redress
the wrongs, for which no remedy was available. The King was regarded
as the Fountain of justice. The King discharged this judicial function by
delegating them sometimes to his council and sometimes to his
chancellor. This practice continued and in due course of time it
resulted in the formation of the appellate jurisdiction of the House of
Lords and the equitable jurisdiction of the Lord Chancellor.
But even in this period the equity was not considered as a rival system
to Common Law. The Chancellor consulted frequently the judges of
Common Law court not only on points of pure Common Law but also
on the principles on which he should give equitable relief.
In Sixteenth Century the rules of equity and good conscience which
were administered by Chancellor in the field of equity were developed.
The equitable principles were discussed and published in report. In
Sixteenth century, equity was so popular that even other courts
besides the Chancery began to claim an equitable jurisdiction.
In Seventeenth Century the dispute between the Common Law Courts
and the Chancery regarding the issue of injunction was set at rest
by King James-I. The dispute arose in the end of Oxford's case. The
complaint of the Chief Justice Coke was that the issue of injunctions by
Chancellor it should be ensured that the principle would always prevail,
in case of conflict, over the rules of Common Law. The king James-I
decided that the court of Chancery could issue an injunction restraining
parties from suing in a Common Law court or from seeking
enforcement of a judgment obtained in that court.
(b) The Period of Transformation - The Seventeenth Century was the
century of transformation of Equity. Chancellor Ellesmere was
succeeded by Bacon who earned the reputation of being a most
learned man of his time. He settled down the procedure of the court
which helped his successors. Lord Nottingham became the Chancellor
in 1673. He was a member of a great legal family. He is known as the
father of modern equity because he saw that the time had come for
equity to be systematised. He classified its rules and laid down broad
principles which could be developed by his successors. He turned
equity from matter of chance into matter of Principle. For example, he
introduced the doctrine of "Clogs" on the equity of redemption and the
modern rule against perpetuities.
This work of systematisation of equity was continued by his successors
Lord Hardwick (from 1736 of 1756) and Lord Eldon (1801 to 1806 and
from 1807 to 1827) are notable for this work of systematisation of
equity. They examined and formulated nearly all the rules of equity
transforming it from a haphazard collection of rules into some well
developed, true and definite system of juris prudence.
Notwithstanding the development of equity as an important part of
the English Law, there were two distinct systems of justice
administered by the English Courts. The Courts of Queen's Bench,
Common Pleas and Exchequer administered the Common Law whereas
the Court of Chancery was governed by the Principles of Equity.
In 1854 the Common Law Procedure Act was passed which enabled the
Common Law Courts to grant equitable relief in certain cases. Similarly
the Chancery Amendment Acts 1858 empowered the Court of
Chancery to award damages in addition to or in lieu of injunction. But
this double system of administration of justice led to the passing of the
Judicature Acts of 1873 and 1875. By these Acts the old courts of
Common Law and chancery were abolished and in their place High-
court of Justice with a Court of Appeal over it were established. The
High-Court of Justice was divided into the following five divisions -
(i) the Chancery
(ii) the Queens Bench
(iii) the Common Pleas
(iv) the Exchequer
(v) Probate, Divorce and Admiralty.
All these five divisions of the High-Court of Justice administered both
law and equity together. The procedure of the Court was governed by
the Code of Civil Procedure which was the combination of the best
features of the Common Law and Equity. It was clearly provided in the
Act that in the matter of any conflict or variance between rules of
equity and rules of Common Law with reference to the same matter,
the rules of equity shall prevail.
(c) Modern Period. The modern period was inauguranted by the
Property Legislation of 1925. The property legislation of 1925 repealed
the "Statute of Uses 1535" as it had clearly become futile legislation. Its
abolition therefore simplified conveyancing. By Law of Property Act
1925, the only legal estates capable of subsisting are (i) an estate in fee
simple absolute possession, (ii) a term of years absolute, (iii) certain
legal interests or charges. All other estates, interests and charges are to
take effect as equitable interests. The Law of Property (Amendment)
Act 1926 removed trust for sale from the ambit of Settled Land Act. So
settled principles of equity has taken the shape of legislative
enactment.
Introduction:
Equity is a Latin word which means fairness, justice. It is a system of
law originating in the English chancery and comprising a settled and
formal body of substantive and procedural rules and doctrines that
supplement, aid, or override common and statutory law.
Equity is based on a judicial assessment of fairness as opposed to the
strict and rigid rule of common law. For centuries, the common law
was referred to as the law, in contrast with equity. As to the most
common criticism of equity, these words of the English jurist, John
Selden (1584-1654).
The typical Court of Equity (also known as Court of Chancery)
decision would prevent a person from enforcing a common law court
judgment. The kings delegated this special judicial review power
over common law court rulings to a judge called chancellor, the court
the Chancery. Later, this was too much work for a single judge and
more judges were appointed, called chancellors. The term Chancellor is
still in use in England today and now refers to the British minister of
justice. Thus, a new branch of law developed known as equity, with
their decisions eventually gaining precedence over those of
the common lawcourts.
Definition of equity by various jurists:
1. Mainland: ‘’Equity now is that body of rules administered by
English Courts of justice which were if not for the operation of the
judicature Acts, would be administered only by those courts which
would be known as Courts of Equity.”
2. Henry Levery Ulman: “Equity is a body of rules, the primary
source of which was neither custom nor written law but the imperative
details of conscience and which had been set forth and developed in
the Court of Chancery.”
3. Snell: “Equity- In its technical sense, may be defined as a portion
of natural justice, which, though of such a nature as properly to admit
of being judicially enforced, was, from circumstances hereafter to be
noticed, omitted to be enforced by common law Courts – an omission
which was supplied by the Court of Chancery.”
So,
Equity: ‘modification of common law: the system of jurisprudence that
supplements common and statutory law, when those bodies of law are
inadequate in the attainment of justice;
justice tempered by ethics: justice applied in conformity with the law,
but influenced at the same time by principles of ethics and fair play.
fair claim: a claim that is judged to be just and fair.
An Equitable Trust: ‘position of obligation: the position of somebody
who is expected by others to behave responsibly or honorably;
something in which confidence is placed: somebody that people place
confidence or faith in.
law holding of another’s property: the legal holding and managing of
money or property belonging to somebody else, for example, that of a
minor; arrangement to manage another’s property; a legal
arrangement by which one person (trustee) holds and manages money
or property belonging to somebody else’.
Nature of equity:
• The general rule is that equity follows the rule and the equitable
interest have in general the same incidents and attributes as
having corresponding legal interest. They devolve and can be
settled, mortgaged and disposed of precisely in the same way as
legal interest.
• Equity follows the law and as such a legal estate or interest takes
procedure over the equitable estate or interest. That in case of
conflict between equity and law, the law prevails.
• An equitable right arises when a right vested in one person by the
law should, in the view of equity be a matter of conscience, vested
in another.
• Where the equities are equal, that which is the first time will
prevail.
its relation with law Maxims of Equity
1. Equity will not suffer a wrong to be without a remedy:
This maxim, in Latin, is “Ubi Jus Ibi Remedium ” which means “where
there is a right there is a remedy”. The maxim states that in situations
where the common law confers a right, it also gives a remedy for
infringement of that right. It must be kept in mind that this principle is
applicable only where the right and the remedy both are within the
jurisdiction of the court. In the Law of Equity, injunction and specific
performance are also the types of remedies available. In Ashby v.
white a qualified voter was not allowed to vote and thus he sued the
returning officer, this case deals with the principle laid down in this
maxim, i.e. if a person has been granted a right, he is also granted with
a remedy.
2. Equity Follows the Law:
This maxim is also expressed as “aequitas sequitur legem”, which
means that equity will not allow a remedy that is contrary to the law.
This maxims lays down that equity supplements law and does not
supersede it. The discretion of the court is governed by law and equity
which are subservient to one another. Wherever the law can be
followed, it must be followed. In the cases where the law does not
apply specifically, this maxim suffers limitation.
3. He who seeks Equity must do Equity:
This maxim states that the plaintiff is also subject to the powers of the
court and is thus obligated to perform his duties following the principle
of equity. The concern of this maxim is the future conduct of the
plaintiff. Thus, this maxim applies to the party who seeks equitable
relief as it stipulates that the plaintiff must also recognize and submit
to the right of his adversary.
4. He who comes to Equity must come with clean hands:
This doctrine relates to the past conduct of the parties and states that
the person who comes to the court seeking equity must not have
involved in an inequitable act himself in the past. This maxim is
concerned with the past behaviour of the plaintiff. The maxim does not
concern the general behaviour of the plaintiff, the defence of unclean
hands is only applicable in situations where there is nexus between the
applicant’s wrongful act and the right that he wishes to enforce.
5. Delay defeats Equity:
which means that Equity assists the vigilant and not those who sleep
on their rights. Unreasonable delay in bringing forth a claim is known
as laches. Laches may also result in dismissal of the claims. Thus, a
party must assert an action within a period of reasonable time. There
are certain situations where the law of limitation is expressly applied,
in such cases, there is a particularized legal situation where a time
period, which has been expressly prescribed, has elapsed and the party
is barred from bringing a suit of action.
6. Equity acts in Personam:
This maxim states the equity applies to a person rather than a
property. In England, the Court of Common law and Chancery Courts
were distinguished by the fact that the former had authority over the
person as well as property but the latter only acted over people. The
Equity court’s coercive power arose from their authority to hold the
violator in contempt of court and punish accordingly. Since the law of
equity was applicable to the persons and not the property, it could also
apply to the property outside a jurisdiction, provided that the person
was within the jurisdiction. In the case of Penn v. Lord Baltimore, an
order of specific performance was made for the plaintiff who brought a
boundary dispute case to an English Court, yet the land was situated in
Maryland, USA. the jurisdiction of the court was applicable to the
parties as they both were English and lived in England.
7. Where the Equities are equal the first in time shall prevail:
Where the legal estate is absent in the matter and the contest is
among equitable estate only, the person whose equity is attached to
the property first in time will be entitled to priority over others. Here,
the term equities refer to multiple equitable interests. Thus, in case
two equities are equal, the original interest, i.e., the first in time will
succeed. For example, if A grants an equitable mortgage to X and then
subsequently grants the same mortgage to Y, X’s mortgage shall take
priority.
8. equality is equity:
This principle is expressed by the Latin maxim Aequitas est quasi
aequalitas which means equality is equity. This maxim implies that as
far as possible, equity strives to put the litigating parties on an equal
level and equate their rights and responsibilities. The ordinary law may
give one party advantage over the other but the court of equity,
wherever possible, puts the parties on an equal footing.
9. equity looks to the intent rather than form:
This is the maxim by the means of which an equitable remedy was
established which allows for the terms of a contract to be interpreted
by taking into account the intention of the parties. The common law
was very rigid and could not respond favourably to demand of time,
this meant regarding the form of the contract more important than the
substance. Equity, on the other hand, looks to the spirit and not the
letter of the contract. This principle is enshrined in the provision for
relief against penalty and forfeitures which states that the object of a
contract is to perform it and not the compensation, thus the
compensation must be proportionate to the damage and not benefit
the receiver (Section 74 of the Indian Contract Act provides for
claiming reasonable compensation). In the case of the contract for the
sale of land, if the party fails to complete within a fixed period, equity
allows reasonable time to the party to complete it (Parkin v. Thorold).
10. Clog on Redemption:
When a mortgage takes place, the mortgagor has the right to get back
his property when he pays back the mortgage amount. This is known as
the right of redemption and arises out of equity. Anything which
obstructs the right of the mortgagor to redeem his property is void,
and such obstruction constitutes a clog on the right to redemption.
This is also known as the doctrine of a clog on redemption.
Remedies under law of equity:
There are some remedies available to the plaintiff primarily by the
court of law to compensate for the loss he has suffered, some of them
are: –
1. Injection: – It is a type of remedy in which the court provides a
certain law and order on which the parties are pressured or
restrained to perform a specific act.
2. Specific performance: – In these types of remedies, the court
passes a statement in favor to complete certain functions that are
interlinked or already a part of the contract.
3. Recession: – This remedy alternatively takes the parties back to
their normal position before entering into a contract.
4. Rectification: – In such a measure the court orders correcting or
making some changes to the written document to reflect what is
actually said on the first page.
Conclusion:
The laws related to equity have evolved through precedent and the
intention is to grant equitable rights and remedies to the parties. The
decisions of equity have largely been based on the judge’s discretion
and understanding of the fair and just cause. Equity dates back to the
centuries ago and is still as relevant, so is the case with law. Law and
equity both are important for justice. Where the rigidities of the law
threaten justice, equity prevails, and where equity has no remedy the
letter of law is followed. Justice, thus, depends upon both and thus,
both must be consulted in order to deliver justice.
UNIT –II
Trust
Introduction:
According to the Indian Trusts Act, 1882, a trust is referred to as an
obligation that is annexed to the ownership of property, and it arises
out of a confidence reposed and accepted by the owner for the benefit
of another person and owner. It is an acceptance of an obligation by
someone, but against either some kind of property or funds to use it or
hold it in order to gain benefit for the person, for whom the trust is
created. The rights and liabilities of the beneficiary are also dependent
on the kind of trust, to some extent – as there are many different kinds
of trusts.
Definition of Trust:
According to Section 3 of Indian trust Act,1882, trust is defined as an
obligations annexed to the ownership of the property, arising out of
confidence reposed in, accepted by the owner, or declared and
accepted by him, for the benefits of another or of another and the
owner.
The nature of trusts:
There is no single agreed definition of a trust, but one that has been
accepted by the courts is as follows:
'A trust is an equitable obligation, binding a person (who is called a
trustee) to deal with property over which he has control (which is
called the trust property), for the benefit of persons (who are called
the beneficiaries or, in old cases, cestuis que trust), of whom he may
himself be one, and any one of whom may enforce the obligation.'
Origin and Development of Trust:
In fact, it can be argued that the trust concept did in fact have its
origins in Roman civil law and that the trust-like devices that developed
through the common law of England actually originated in Rome.
The Indian Trusts Act (ITA) 1882 was a code that embraced a
purportedly distinct model of trust, one that was ‘obligational’ in
nature and had no division between legal and equitable ownership.
British India had a rich tapestry of trusts and trust-like devices, the
regulations of which produced a complex body of law. With the
abolition of East India Company’s trade policy in 1813, the influx of
European capitalist increased into India which led to the growth of the
use of private and charitable trusts among them. These took the form
of English trusts and were regulated by the English law. There were
also several ‘trust-like’ devices used by the native population for
different purposes, such as Islamic waqf, benami transactions etc.
These operated in society without interference from the colonial
courts. But in some cases, the disputants chose to litigate in those
courts which made it necessary for Anglo-Indian judges to confront the
native trust-like’ devices.
Parties in a Trust:
• Author/Settlor/Trustor/Donor : The person who wants to
transfer his property and reposes confidence on another for the
creation of the trust.
• Trustee : The person who accepts the confidence for the creation
of the trust
• Beneficiary: The person who will benefit from the trust in the near
future.
Objectives of a Trust in General:
The main objective is that the trust should be created for a lawful
purpose. For example, if Mr X had stolen money from a bank and given
it to Mr Y with the intention of giving the money to poor children then,
in this case the trust itself is void as the very main purpose is unlawful.
So how do we actually understand as to whether the purpose is lawful
or unlawful? The answer to it lies in Section 4 of the Act. As per Section
4, all purposes are said to be lawful unless it:
• Is forbidden by law
• Defeats the provisions of law
• Is fraudulent
• Involves injury to another person or his property
• Immoral or against to public policy
Classification of Trust:
Generally, there are two types of trusts in India:
1. Private trusts and
2. Public trusts.
The Indian Trusts Act, 1882 governs the private trusts.
1. Private Trust:
A trust is called a Private Trust when it is constituted for the benefit of
one or more individuals who are, or within a given time may be,
definitely ascertained. Private Trusts are governed by the Indian Trusts
Act 1882. A Private Trust may be created inter vivos or by will.
Following are essential conditions to bring into being a valid Private
Trust:
• The person who creates a trust (settlor) should make an
unequivocal declaration binding on him.
• The objects of the trust must be defined and specified.
• The beneficiaries are specified.
• He must transfer an identifiable property under irrevocable
arrangement and totally divest himself of the ownership and the
beneficial enjoyment of the income from the property.
Unless all the above requisites are fulfilled, a trust cannot be

said to have come into existence.
2. Public Trust:
A trust is called as Public Trust when it is constituted wholly or mainly
for the benefit of Public at large, in other words beneficiaries in the
Public trust constitute a body which is incapable of ascertainment. The
Public trusts are essentially charitable or religious trusts and are
governed by the general Law. The provisions of Indian Trusts Act do
not apply on Public Trusts. Like the private trusts, public trusts may be
created inter vivos or by will. The Indian Trusts Act does not apply to
public trusts which can be created by general law.
Creation of Trust
WHO CAN FORM A TRUST:
Any person who is competent to hold a property can form a trust. This
may include :
• Company
• Individuals
• Association of persons
• HUF (hindu undivided family)
• Legal guardian on behalf of the minor with permission of the civil
court.
PROCEDURE OF CREATION OF A TRUST DEED:

1. Creation of trust deed: To register a trust, proper deed should be
created on a stamp paper of the expected value of the trust.
2. Submit the trust deed along with the photocopy of the deed to
the local registrar for registration.
3. At the time of registration, the settler and the two witness must
be present along with the original identity proof.
4. The registrar retains the photocopy of the trust deed and returns
the original registered copy of the trust deed.
DOCUMENTS REQUIRED FOR REGISTERING THE TRUST DEED:
1. Aaadhar and Pan card (original with the self attested copies).
2. Water, Electricity bills with their own name if the property is self
occupied .
3. Rent agreement along with NOC from the owner of the property in
case of rented property.
4. Trust deed to be signed and submitted in sub registrar office under
revenue department act of the concerned district court of respective
area or district.
ESSENTIAL RECITALS OF TRUST DEED
• A trust deed may be created using any language sufficient to show

the intention. A trust deed should have
• Name of the trust
• Name of the author/ settler of the trust
• Name of the trustee
• Name of the beneficiary whether individual or public at large
• Objects and purpose of the trust
• Property that shall devolve
• Place of principal or other offices of the trust
• Procedure for appointment, removal or replacement of a trustee,
their rights, duties and powers etc.
• Rights and duties of the beneficiaries
• Mode and methods of dissolution of trusts.
Trustees
Anyone capable of taking physical possession of or legal title of the
property can be a trustee. And there is no limit to the number of
trustees to hold the position in one trust. Generally there are more
than one trustee , the trustees, with respect to each other, are referred
to as co-trustees, and when acting jointly as a collective body are
referred to as the Board of Trustees .The trustee should be at least
someone capable and fit for executing the powers and duties
honorably.
Appointment of the trustee:
Appointment of the trustee should be done formally, expressly in
writing, even though it will always be implied “the individual will use
the trust property, or performs any act to carry out the trust for the
interest of beneficiaries”. Once the acceptance has been tendered then
no court of law can prevent the trustee from holding the office, except
for the breach of trust or good cause dependent upon clear and lawful
necessity.
Removal of trustee:
Discharge of Trustee
• Disclaimer by the trustee- a trustee may within reasonable period

disclaim the trust i.e. even after his appointment but before acting
in capacity of the trustee.
• Death of the trustee
• Retirement of trustee
• Grounds of Discharge of the trustee under Sec 71-
Sec 71 of Indian Trust Act following are the only grounds of discharge
of trustee
1. By extinction of trust
2. By completion for duties under the trust
3. By such means as may be prescribed by instrument if trust
4. By appointment of a new trustee
5. By consent of himself and the beneficiary (where there are more
than one beneficiaries, by consent of all of those who are
competent to contract)
6. By court to which petition of his discharge is presented.
Removal of the trustee by court:
The court has an inherent power to remove the trustee and appoint
new one in his place whenever in opinion of the court the interest of
the beneficiary so requires. Grounds of removal by court may
include-
a) Moral turpitude
b) Trustee commits breach of trust
c) Trustee becomes bankrupt
d) Trustee shows himself to be unfit for office by want of honesty,
fidelity, capacity etc.
Duties/Liabilities of a Trustee:
The Indian Trusts Act, 1882 provides for certain duties/liabilities of a
Trustee, we shall see each one of them in brief detail.
• Execution of Trust
The trustee is required to actually carry out the purpose of the trust as
laid out in the Trust deed. The trustee is also required to follow the
directions of the Author of the Trust at the time of creation of the
trust.
However, the trustee is not required to follow such directions if they
are impractical or illegal.
• Acquaintance of Trust Property
The trustee is required to know about the details, whereabouts and
current condition of the trust property and also to take appropriate
measures to secure the trust property.
• Protection of Title of Trust Property
The trustee is required to defend all the claims against the title of the
Trust property and to take adequate measures to assert and protect
the title of the property.
• Not to set up Title adverse to the beneficiary
As the trustee is entrusted with the trust property to maintain it for the
benefit of the beneficiaries, it is expected and required of the trustee
to not set up any title adverse to the beneficiary.
A good example explaining this point would be, suppose the trustee is
entrusted with an immovable property and is required to apply the
rents and profits of such property for the benefit of the beneficiaries.
The trustee is also given the rights to sell such property.
It is expected of the trustee that the trustee would not sell such
property to himself or anyone of his relatives or friends or a person of
like nature, as such an action on the Trustee’s part would be adverse to
the beneficiaries, and the trust factor upon which the foundation of
the trust is built, would cease to exist.
• Take care of the Trust Property
The trustee is required to provide adequate safeguard and required to
apply such prudence to the trust property, as that of an ordinary man
would apply to his own property.
However, the Act provides that the Trustee would not be responsible
for any loss caused to the trust property or the benefits arising thereof,
if he had applied such prudence as would an ordinary man would apply
to his own property.
• Convert perishable property
If the trust property is of such nature, that with time, it would keep on
deteriorating and keep losing value, the trustee is required to convert,
i.e. sell and convert such property into cash proceeds and apply such
proceeds for the benefits of the beneficiaries. This duty is especially
required of a trustee when the trust is created for the benefit of
several persons in succession.
• Be impartial among the beneficiaries
When the trust is created for the benefit of several beneficiaries, the
trustee is required to apply the benefits received from the trust
property equally among the beneficiaries, without being partial to
anyone or any group among the beneficiaries.
• Protect the trust property from adverse beneficiary
When there are several beneficiaries of a trust, and one or more of
such beneficiaries commit, or threaten to commit an act, which would
be adverse to the interest of other beneficiaries and the trust in
general, the trustee is required to take measures to stop such act of
such beneficiary/beneficiaries.
• To maintain and keep books and accounts
The trustee is required to keep a clear and accurate account of the
trust property and at all times, provide the same to the beneficiary
upon the request of the beneficiary.
• Investment of Trust money
The Act specifically provides that when the trust property consists of
money, and such money is not required to be immediately applied for
the benefit of the beneficiaries, the trustee is required to invest such
money in such instruments as provided for in the Act. The Act provides
for instruments such as promissory notes and other securities of the
Central Government; in stock or debentures of the Railways or other
government companies; in Units issued by the Unit Trust of India, etc.
Powers/Rights of a Trustee
Certain rights/powers are conferred upon the Trustee under the Indian
Trusts Act, 1882. They are discussed in detail in the following
paragraphs.
• Right to Title deed
The trustee is entitled to possess the trust deed or any other
instrument by which the trust is created, and the title documents of
the trust property.
• Right to reimburse expenses incurred for trust purposes
The trustee has the right to be reimbursed for the expenses incurred
by him for the purpose of the trust, like expenses incurred for the
execution of the trust, for the preservation of the trust property, for
the protection or support of the beneficiary, etc.
• Right to re-collect overpayment
If a trustee has mistakenly made a payment over and above the
required amount to a beneficiary, the trustee has the right to collect
such excess amount from the beneficiary. Such collection might be
made from the interest of the beneficiary in the trust property, and if
not possible, then even from the beneficiary personally.
• Right to indemnity from breach of trust, by a gainer
If a person has committed a breach of trust and has gained from such
breach, the trustee has the right to indemnify himself against such gain
by the person who has committed such a breach.
However, if the trustee himself is also guilty of fraud in committing
such a breach, then he loses the right to indemnify himself in such a
situation.
• Right to seek Court’s opinion in managing trust property
The trustee has the right to apply to the Court, by way of a petition, to
seek the Court’s opinion, advice, opinion or direction with regards to
the management of the trust property.
• Right to Settle accounts
When the duties of a trustee are complete, the trustee is entitled to
have the accounts of the administration of the trust property examined
and settled, and when no benefit is due to any beneficiary under the
trust after the completion of the trustee’s duties, the trustee is also
entitled to receive an acknowledgement to that effect.
• Right to sell trust property, along with power to convey
The trustee has the power to sell the trust property as per the
instructions laid out in the trust deed, and if no such instructions are
laid out, then by way of public auction or private contract, in any way
the trustee deems fit.
• Right to vary or rescind the sale of trust property, and re-sell the
same
The trustee has the power to vary the conditions of the sale of trust
property or even rescind such sale. He also has the power to re-sell the
same property. If in such recession and re-sale, if any loss occurs, the
trustee is not liable for the same.
• Power to manage investments
The Trustee has the power to sell any existing investment of the Trust
property and invest the same into any other instrument, as he deems
fit.
However, if there is a beneficiary who is competent to contract, then
such power cannot be exercised by the trustee without such
beneficiary’s consent in writing.
• Power to apply property of Trust for maintenance of minor
beneficiaries
In case the beneficiary is a minor, the Trustee has the power to apply,
i.e. use the income for the Trust property for the maintenance of the
minor. Maintenance of the minor may include functions such as food
and clothing, Education, Religious worship, marriage, funeral, etc.
• Power to compound
This power may also be called as power to settle disputes. When there
is any dispute related to any of the trust property, the trustees, when
there are two or more trustees appointed, or the sole trustee, may
settle the dispute in the manner they think fit. For example, they may
compromise, compound, abandon the dispute or may even submit the
dispute to arbitration. In the doing of such settlement, the sole trustee
or the trustees may enter into any agreement, or instruments, as they
deem fit.
• Trustees to continue with trust if one of several trustees dies or
disclaims
When there are two or more than two trustees appointed, and one of
them disclaims the trust or dies, the remaining trustees shall have the
power to deal with the trust property, as provided in the Trust deed.
However, such power would not be exercisable, if the Trust deed
specifically requires a specific number or more of trustees to execute
the authority provided for in the trust, and after the death or
disclaimer, such specific number is not satisfied.
Beneficiaries:
Duty to compensate the trustee
It is the duty of the beneficiary to compensate or reimburse the trustee
in case there are any damages caused either to the trustee or to the
trust, due to the beneficiary. It is legally mandatory for the beneficiary
to compensate if there is any injury or damage caused by himself.
Liability in breach of trust
The beneficiary is held liable, if by any chance, in any case, he/she
breaches the trust agreement in any way. He is held fully liable for all
losses/damages if he commits a breach of trust.
Liability not to harm others’ interests
Beneficiary cannot harm another party’s interests in any way in the
trust, as he will be liable for any harm caused to another party within
the trust that is due to him or his behaviour/etc.
Liability not to obtain any advantage without the consent of other
beneficiaries: It is mandatory for the beneficiary to take consent of all
other beneficiaries involved in the trust in case, he/she needs to obtain
any kind of advantage. If not done, it will be considered as a breach of
trust.
Liability to receive his interest(s)
The beneficiary is entitled to get his/her interest from the trust, but the
beneficiary should not claim more than his interest in the trust
property.
Liability to become aware of breach of trust
It is the beneficiary’s liability to become aware of all types of breach of
trust, whether by the author or by the trustee, and it is his liability and
responsibility to become fully aware and proceed against any party, if a
breach of trust is found by the beneficiary.
Liability in case to deceive the trustee
The beneficiary will be held liable if in case, it is found that he has
deceived the trustee in any way or induced him to commit a breach of
trust. Court will proceed against the beneficiary in this matter.
Liability to take reasonable steps
The beneficiary will be held liable in case he fails to take reasonable
steps and actions, as mentioned in the trust deed, within the rights and
duties of other beneficiaries. It is mandatory for the beneficiary to only
take steps within the limitations and boundaries set of all other
beneficiaries.
Remedies for Breach of Trusts:

In line with the appropriate rules of Equity, beneficiaries of a trust will
not be left without remedy in the event of an anticipated or completed
breach of trust. These remedies will be discussed below.
1. Injunction:
An injunction would lie to prevent a breach of trust by a trustee. If the
beneficiary anticipates that it’s likely there’d be unauthorized dealing
with the trust property, he can apply to the court for an injunction to
prevent such dealing or, in appropriate cases, apply for an injunction to
compel the trustee to act in accordance with the terms of the trust.
2. Personal Remedy Against The Trustees:
In deserving situations, a trustee would be personally liable for
breaches of trust occasioned by his action or inaction. In this wise, his
liability may extend to reimbursing the beneficiaries for unauthorized
dealing with the trust property or even to imprisonment for fraud and
indiscretion.
There are many components of this personal remedy though. They
may be examined as follows: Liability
First off, the liability of trustees is personal, not vicarious. This means
that each trustee is individually liable and cannot be held accountable
for the default of others unless in specific instances. The principle is
espoused in s. 24 Trustee Act and s. 21 Trustee Law which provide that
a trustee is only chargeable for money and securities actually received
by him, notwithstanding that he signed any receipt for it and is only
answerable for his own acts, receipts, defaults or neglect, unless same
happens through his willful default.
3. Measure of liability:
There are two heads of liability here: capital liability and interest
liability. Capital liability arises where the breach of trust occasioned
loss to the trust property or estate while interest liability arises where
the trustee has made an unauthorized investment that results in the
trust property being partly or wholly lost.
Thus, as far as capital liability is concerned, if the trustee does anything
to occasion loss to the trust property, he is liable for the loss to the
extent that the trust property is affected.
However, if a profit accrues from any unauthorized dealing, the
beneficiaries may claim it. And if they adopt the transaction that
causes loss, that is the end of trustee’s liability in that respect.
4. Imprisonment:
As was held in IRBY v IRBY (No. 3) (1858) 25 Beav. 632, a trustee may
be imprisoned for not more than a year if he fails to pay any sum in his
possession or under his control as ordered by a court of Equity. In that
case, the trustee was found guilty of misappropriation and sentenced
him to imprisonment. The same will apply to auctioneers and
executors. See CROWTHER v ELGOOD (1887) 34 Ch. D. 691.
Defences of trustee
A trustee is not expected to lie down and die when there are
allegations of breach or misconduct against him. Since his duties are
onerous and his punishment even more so, he is given a number of
defences that he can rely on to show his non-liability.
1. Relief by the court:
The court, by virtue of s. 61 Trustee Act, is empowered to relieve a
trustee, either wholly or partially, from personal liability for a breach of
trust if he acted honestly and reasonably though he omitted to obtain
direction from the court before the breach. This extends to executors
as well. Thus, this defence builds on the principle of ‘willful default’ in
liability.
2. Lapse of time:
The previous position under the Trustee Act was that a claim against an
express trustee for breach of trust could not be barred by mere lapse
of time and even the expression ‘express trustee’ included many
constructive trustees.
However, s. 31(1) Limitation Act now stipulates that, in the absence of
express provisions to the contrary elsewhere, an action by a
beneficiary to recover trust property from a trustee or in respect of any
breach of trust shall not be brought after six years from the date on
which the right of action accrued. This provision protects personal
representatives, express, implied and constructive trustees etc.
However, there would be no period of limitation in respect of an action
by a beneficiary in respect of fraud by the trustee or to recover trust
property or its proceeds in the possession of the trustee and converted
to his use.
Time begins to run against the beneficiary when the breach of trust
was committed, whether he knew of it or not. But if he was under a
disability, time does not begin to run until the disability is removed. If
his interest is reversionary, time only begins to run when his interest
falls into possession.
If one beneficiary is barred, then even if another beneficiary brings
proceedings against the trustee and benefits, the barred beneficiary
cannot also benefit.
3. Discharge in bankruptcy:
If a trustee goes bankrupt and obtains a discharge, he is free from
further liability in respect of a breach of trust except the breach was
fraudulent and he was a party to the fraud.
UNIT-3
Specific Relief Act 1963
Introduction:
As the main objectives of the Act have been vested in the very title of
this statute i.e. Specific Relief, due to which we can have a basic
understanding that the Specific Relief Act is a legal statute dealing with
reliefs or recovery of the damages of the injured person. This Act was
enacted in 1963 following the approach that when a person has
withdrawn himself from the performance of a particular promise or a
contract with respect to another person, the other person so aggrieved
is entitled to a relief under Specific Relief Act, 1963. This Act is
considered to be in one of the branches of the Indian Contracts Act,
1872.
Definitions:
1. Section 2(a) deals with obligations which are duties imposed on a
person by the law or the legal body.
2. Section 2(b) deals with the settlement that means delivery of the
movable or immovable property to their successive interests
when it is agreed to be disposed of.
3. Section 2(c) deals with the word “trust” which has the same
meaning as defined in section 3 of the Indian Trusts Act, 1882.
4. Section 2(d) deals with the word “trustee” which means the
person holding trust in the property.
5. All other definitions which have not been explained herein are the
same as referred to the definitions of the Indian Contracts Act,
1872.
Specific relief:
Section 4 of this act explains that this Act grants special relief for the
enforcement of individual rights and not for imposing penal laws.
The enforcement under this Act only bases itself on the individual
civil right and the substantive nature must be established for that
fact. To be understood in a simpler way specific relief is related to
providing relief for the infringed civil rights of the individual. Its main
objective is to focus on the rights and if there is any penal nature of
the case, it may have to be established for proving the same.
Recovering Possession of Property
The recovery of possession of this Act is provided under two heads:
recovery of the immovable property and recovery of the movable
property. The law of Specific Relief Act,1963 works on a basic principle
that “Possession is itself a prima facie evidence of the ownership”.
Recovery of possession of property is the subject matter of sections 5
to 8 of the Specific Relief Act. The relevant provisions are described in
Chapter 2 of this Act.
Property may be divided on the basis of nature into two.
1. is moveable and
2. is immovable.
Act provides for different provisions for recovery of possession of both
types of property. The provisions related to immovable property must
first be explained.
Recovery of possession of Immovable property:
Section 5 and 6 of the Specific Relief Act, 1963 provide methods for
recovery of possession of the certain specific immovable property.
Section 5 of Specific Relief Act, 1963 provides
that a person entitled to the possession of any specific immovable
property may recover it in the manner prescribed by the Code of Civil
Procedure.
"A person entitled to the possession of the specific immovable
property can recover it in the manner provided by the Code of Civil
Procedure, 1908”.
The essence of this section is "TITLE "i.e. the person who has better
title is a person entitled to the possession. The title may be of
ownership or possession. Thus, if X" enters into peaceful possession of
land claiming his own although he might have no title, still he has the
right to sue another who has ousted him forcibly from possession
because he might have no legal title but at least has a possessory title.
It is a well satteled principle of law that a person, who has been in a
long continuous possession of the immovable property, can protect the
same by seeking an injunction against any person in the world other
than the true owner. It is also a settled principle of law that owner of
the property can get back his possession only by resorting to due
process of law. It states that a suit for possession must be filed having
regard to the provision of the Code of Civil Procedure.(Or.xxi, R.35,36)
For a valuable understanding of this section it becomes quintessential
to glance at the provisions of section 110 of the Indian Evidence Act
which states the burden of proof as to ownership. This section
enunciates that when there emerges a question of ownership of
possession the burden of proving that the person is not the owner lies
on the person who affirms in converse. It is also important to note at
this point that the possession holds good against the whole world
except the true owner.
Jagdeesh vs Nawab Saeed Ahmad the court observed that ... the
plaintiff is suing for ejectment can succeed on the strength of his own
title.
Ejectment suit based on possessory title:
Sec.6 of the Specific Relief Act clearly states that When a person is
deprived of possession of his immovable property, the person may
either sue himself or any other person may also sue to recover
possession of his proprty.
Significant changes have been made by amending section 6 in 2018.
Sec 6 read as:
Suit by person dispossessed of immovable property.—(1) If any
person is dispossessed without his consent of immovable property
otherwise than in due course of law, he or any person through whom
he has been in possession 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-
• After the expiry of six months from the date of dispossession.

• 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 the decree under
this section is allowed.
(4) Nothing in this section shall bar any person from suit to establish his
title to such property and to recover possession thereof.
Sec.6 is only applicable if the plaintiff proves:
1. That he is in juridical possession of the immovable property in
dispute.
2. That he had been dispossessed of without his consent and without
due process of law.
3. That dispossession took place within six months from the date of
suit.
Section 6 was introduced to expeditiously resolve matters hence, there
shall lie no appeal against any order or decree in any suit instituted
under this section, nor shall any review of such decree or order be
allowed -Section 6(3). This clearly emphasizes that the order or decree
passed under this section is a case decided and only Revision as under
Section 115 of the Code of Civil Procedure, 1908 shall be allowed.
However, institution of suit under this section does not bar the
aggrieved party to seek relief under Section 5 for the recovery of
property on the basis of title.
Recovery of specific movable property
Recovery of the possession of movable property
Section 7 explains that when a person wants to recover the possession
of the movable property, they can follow the procedure expressed by
the Code of Civil Procedure,1908. section 7 has further two sub-clauses
which further details that a trustee may file suit against the beneficial
interest he was entitled to and the other sub-clause explains that the
ownership of the property can also be expressed with the presence of
a special right given to the person suing; which would be enough as an
essential to file a suit.
Essentials of section 7 are as follows:
1. There must be a presence of movable property which is capable of
being delivered or disposed of.
2. The person suing must have the possession of the property in
question.
3. There may be an existence of a special or temporary right on the
property.
Section 8 of the Specific Relief Act,1963 explains that when a person is
in the possession of the article to which is he is not the owner, shall be
compelled to deliver such article to the person who will have its
immediate possession in following cases:
• When the article is held by the defendant as the trustee of a
person who has the immediate possession.
• When compensation in money is not an adequate relief.
• When it is difficult to ascertain actual damage caused to the
person.
• When the possession of the article has been wrongfully
transferred from the person so entitled.
Specific Performance of contracts
Section 10 includes in what condition-specific performance of the
contract may be enforceable, specific performance usually depends
upon the discretion of the court but there are certain conditions for
performance which are mentioned as follows:
1. When the damages or loss occurred due to the non-performance
of the contract cannot be ascertained.
2. When money as compensation is not an adequate relief due to
the non-performance of the contact.
Until the contrary is proved it is presumed by the court that
(i) that the breach of contract of immovable property cannot be
adequately fulfilled by money
(ii) (ii) the breach of contract of movable property can be
relieved except in the cases of
a) where the property is not an ordinary article of commerce,
b) where the property is kept by the defendant as a trustee for the
property.
No Standard for ascertaining damages
Section 10 providers for specific performance of contract in those
cases where there is no standard for ascertaining damages or where
the money cannot form adequate relief for the non-performance.
Further enforcement of the specific performance is at discretion of the
court and no one claim it as a matter of right.
Pecuniary compensation not adequate relief:
The specific performance will also be granted when compensation in
money is not adequate relief in facts and circumstances of case.
Damages may be considered to be an inadequate remedy if it is
difficult to quantify them.
Conditions for applicability of Section 10:
• The suit must relate to the specific performance of contract.

• The case must fall within any of the Clauses (a) and (b);
• The case must in the discretion of the court, be fit one to warrant
specific performance;
• The case must not fall within any of the Section of Chapter II
which prohibits specific performance.
Explanation to Section 10 carries presumption in favour of plaintiff
and declares that it should be presumed that compensation does not
afford adequate relief in following cases:
• In all cases where the contract is for the transfer of immovable

property.
• In case of movable property where:
➢ The property is not an ordinary article but an article of special
value or of specialinterest to plaintiff.

➢ The article is not easily obtainable in the market.
➢ The property is held by the defendant as an agent or trustee of
the plaintiff.
Section 12 states
“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 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; 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 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 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.”
A court will not, as a general rule, compel specific performance of a
contract unless it can execute the whole contract. This section deals
with classes of cases in which specific performance may be granted
with or subject to special conditions or restrictions. When a part of the
contract is not capable of performance is always whether the contract
can be executed in substance.
This provision can be invoked only where terms of the contract permit
segregation of interests and rights of parties in the property, and if the
intention is to the contrary, the provision cannot be attracted.
Section 14 of the Specific Reliefs Act (S.R.A.), 1963 provides for certain
circumstances wherein a contract cannot be specifically performed.
These have been discussed as follows:-
Contracts not specifically enforceable.-
Where compensation in money is an adequate relief:
Contracts, the non-performance of which can sufficiently be
compensated by the payment of damages cannot be specifically
performed as per S. 14(a) of the Act. For example, a contract for the
supply of commodities is generally not specifically enforceable.
Where specific performance of material terms cannot be enforced:

S. 14(b) states that 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. For example a contract for personal service or employment
cannot be enforced by or against the employer, only damages can be
sought.
A contract which is in its nature determinable:

The term determinable suggests a situation where despite the court’s
enforcement; the parties can immediately revert to their original
position, thereby making such enforcement futile. For example, where
A and B contract for partnership without providing a defined duration,
the partnership cannot be enforced as it could easily be dissolved at
once.
A contract the performance of which involves the performance of a

continuous duty which the court cannot supervise:
The difficulty of supervision by the Court is the main reason why due
performance in certain contracts cannot be specifically enforced. Thus
the agreement by a landlord to provide a housekeeper cannot be
specifically enforced.
Contracts that cannot be specifically enforced
Section 14 mentions certain contracts which cannot be specifically
enforced which are as follows:
1. When there is a non-performance for the act, and money is
adequate compensation.
2. .A contract that is full of many details and its nature is personal to
the parties, these can not be specifically enforced.
3. The contract requires continuous work for which the court cannot
supervise.
4. The court whose nature is determinable.
Who May Obtain Specific Performance?
According to section 15 of the Specific Relief Act, 1963, specific
performance of a contract may be obtained by:
1. Any party:
Illustration: In a contract, there are two parties, A and B. Therefore,
either of the parties can obtain specific performance of the contract.
2. The principle or the representative in interest, of any party.
Representative in Interest: It is a broader term that includes an agent,
assignee, or legal representative.
Illustration: A has an interest in B’s property. Then A or his principal (if
A is an agent) will be considered as a representative in interest.
Conditions in which a representative in interest or his principal
cannot obtain specific performance of the contract are-
i. If the knowledge, ability, solvency, or any personal trait of
such party is a material factor in the contract.
ii. If the contract provides that his interest shall not be
assigned.
Illustration: A made a contract with B for painting (skill). Hence A
cannot obtain the specific performance of this contract as it is made on
an individual’s skills.
3. Any beneficiary is entitled to specific performance if the contract
involves a marital settlement or a compromise of disputed rights
between members of the same family.
Illustration 1: A made a contract with B to marry C for a specified
amount, and if B denied paying then, A can obtain specific
performance of the contract.
Illustration 2: A, B, C, D are brothers and have a joint property in the
village. A, B, C made a contract to give whole property to D. D is the
beneficiary entitled here and can claim specific performance of such
contract.
4. If a tenant for life has entered into a contract in the due exercise of
a power, the remainderman;
Tenant for life: A person who is beneficially entitled under a
settlement to possession of settled land to use a property for the rest
of his life. He is entitled to hold the legal estate but only for the
duration of his life.
Illustration: A gave his house to B for his life but had a contract that
after his death, the property will accelerate to C.
Remainderman: A person who inherits or is entitled to inherit property
upon the termination of the estate of the former owner. A
remainderman is a person who has an interest in the remaining
property and will eventually own it at some time in the future.
Illustration: A gave his house to B for lifetime. B is a tenant for life but
had a contract that after B’s death, the property will accelerate to C. C
is remainderman.
5. A reversioner in possession, if an agreement is a covenant entered
into with his predecessor in title and the reversioner is entitled to the
benefit of such covenant;
Reversioner in possession: Any person to whom the property is
reversed back, and he is in possession of that particular property.
When a property owner effectively transfers property to another yet
retains some future rights in the property, it is known as a reversioner
in possession.
Covenant: It is a legal promise or an agreement between two people,
or companies, or even countries.
Illustration: A (grandfather), B (father), and C (son). A does not want to
give his property to B. Instead, he wanted to give his property to C. A
entered into a contract with Z (tenant for life) to enjoy his property till
his life and pay the rent to C, and after Z’s death, the property will be
accelerated to C (reversioner in possession).
Here, the reversioner in possession also has the right to obtain the
specific performance of the contract entered by another person.
6. If an agreement is a covenant and the reversioner suffers material
injury in case of breach of contract, then reversioner in remainder will
be entitled to the benefit.
The reversioner will be responsible for the injury caused by the non-
performance of the contract by the remainder.
Illustration: A gave his house to B and asked to pay the rent to C. If B
does not pay the rent, then C has to bear the injury caused.
7. If a company merges with another company under the terms of a
contract, the new company will form as a result of the merger
(amalgamation).
8. If the promoters of a company entered into a contract before for

the company’s purposes before its incorporation and such contract is
warranted by the terms of the incorporation, the company has to
accepted that contract and communicated such acceptance to the
other party of the contract.
Discretion of court (Sec. 20):
Introduction:- As we all know, the Laws are basically categorized into
substantial laws and procedural laws. The Specific Relief Act, 1963
(herein after called „the Act‟) essentially comes under procedural law
which supplements various substantive laws such as Law of Contracts,
Transfer of Property Act, Sale of Goods Act etc.
The Specific Relief Act deals with certain kinds of specific reliefs as
enunciated in the preamble of the Act itself. As such, the Specific Relief
Act is neither exhaustive nor complete because it deals with only
certain kinds of specific reliefs.
Specific Performance is an equitable relief granted by the court in
favour of the aggrieved party against the party who commits breach of
contract. As we all know that, agreements which are enforceable under
law are contracts. A bear reading of Sections 9 to 25 especially sections
10, 11(i), 14(3) and 20 of the Act provide discretionary power to the
court to grant relief of specific performance.
Section 20 of the Act says that, the 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.
Rectification of contract (Sec. 26):
Rectification of instruments
Section 26 deals with the ways in which instrument can be rectified:
When through fraud or mutual mistake the parties do not show their
real intention then:
• Either party or representative in interest may file a suit for
rectification of the instrument,
• The plaintiff in his plaint may plead for rectification of instrument,
• The defendant in his defence may claim for rectification of
instrument.
The court can direct rectification of instruments in cases where the
party through fraud does not show their real intention to prevent
violation of rights to the third party.
Requirement for rectification
The party who wants to rectify the instrument firstly must give them in
writing and then mention them in their pleading. No relief shall be
granted when the rectification is not specifically mentioned.
Introduction:
Let us first understand the Specific Relief Act,1963. It means an act
which provides remedies for persons whose civil or contractual rights
have been violated. Whenever there is a breach of contract,
compensation or damages are provided for the same, but when the
damages or compensation are not of adequate relief then, in that case,
the specific relief or preventive relief is provided. Now understand
about these terms:
1. Specific relief: – it means when a person does a breach of contract
and when monetary compensation fails to complete contractual
obligation then specific relief is granted.
2. Preventive relief: – it means when a person is prevented to do an
act, which is not validly liable to do.
Legal instrument is a legal term that is used for any legal written
document that is a legally enforceable act, process, obligation,
contractual duty, right or obligation.
So basically in simple terms, an instrument is a document by which any
rights or liabilities are to be created, transferred, limited, or extended.
The term rectification means the correction of an error which here is in
the form of instrument.
‘Rectification of instrument,’ means correcting the errors, here
instrument means contract. Rectification of instruments under specific
relief act is a fair or an impartial remedy that is granted by the Court
when facts are not according to the intention of the parties.
The Specific Relief Act,1963
The Specific Relief Act, means an act which provides relief, that relief is
of two types: –
1. Section 5 to Section 35 deals with the specific relief provisions.
Specific relief provides recovery from immovable property or movable
property or many defences regarding the suit.
Let us take an example to understand it well. ‘X’ is having a property of
‘Y’ and with that property, Y is very much attached because it’s his
grandparent’s property due to which ‘Y’ asked ‘X’ to give his property
at any cost, ‘X’ agrees to do so and Y give him a cheque of rupees 50
lakhs as an advance payment but ‘X’ refuse to give him the property
and he breaches the contract due to which ‘Y’ ask the court to grant
him the specific relief and the court grant him.
2. Section 36 to section 42 deals with the preventive relief provisions.
Preventive relief is granted at the discretion of the court by the
injunction, temporary, or perpetual.
Let us understand with an example, ‘A’ a film actor signs for doing a
film. After shooting half of the movie till 3 months, ‘A’ stopped working
for that film. The film director sues him and said before the court that
damages and compensation are not an adequate relief for him, so the
court gives the preventive relief in which ‘A’ cannot sign another film
till the months he works in the previous film.
Rectification of Instruments:
Section 26 of the Specific Relief Act talks about rectification. Let us
understand in more clear terms. Rectification’ means correction and
here ‘instrument’ means any legal document/contract.
So rectification of instruments means correction or changes in the
contract. Under Section 26 of the Specific Relief Act,1963, it is provided
that when any contract may be rectified:
1. When there is a fraud or when there is a mutual mistake by both the
parties. Now the person who is entitled for the rectification of
instrument are as follows: –
• Either party or his representative can file.
• The plaintiff in any suit can file if any rights arising under the
rectification of instruments.
• Defendants can file in any suit as mentioned in sub-clause (B).
2. If in any case in which a contract or instrument is to be rectified
under clause (1), the court finds that contract is done by fraud or by
mutual mistake of the parties, then the court has discretionary power
to rectify it.
3. If parties claim for rectification and the court thinks fit, then it will be
specifically enforced.
4. No relief shall be granted until the parties specifically claim for
rectification of the instrument.
Modes of Rectification of Instrument
Chapter three of the Specific Relief Act, 1963 deals with the
rectification of instruments and Chapter five of the Specific Relief Act,
1963 deals with the cancellation of instruments. Under section 26 of
the specific relief act, the modes of rectification of instrument are: –
1. Fraud
Whenever someone intentionally misrepresents the other regarding
the contract, there is a way of rectification of the instrument. Fraud
means, when:
• A person suggests a fact which is not true.
• A person hides a fact, which he already knows about.
• A person made a promise without any intention of performing it.
2. Mutual mistake of parties
The term ’mutual mistake’ means the common mistake on the part of
both the parties to contract. A party who wants rectification of the
instrument has to establish that there was a prior complete agreement
that was reduced to writing in accordance with the common intention
of the parties and by reason of mistake the writing did not express the
real intention of the parties. If the mistake is not from both the parties
but from the scribe then it will not be rectified. A mutual mistake can
be established by any parties to a contract. On the basis of unilateral
mistake not amounting to fraud, there cannot be rectification.
3. Real Intention of the Party
The rectification of the instrument always involves the real prior
agreement between the parties and the absence of such facts in the
agreement of the document as a result of fraud or mutual mistake.
The court has also the responsibility to see whether the parties do have
a real intention or they are framing the instrument and further the
court has to ascertain for the same.
Requirements For Rectification of Instrument Under Section 26
There are certain requirements under Section 26 of the specific relief
act.
• Existence of fraud or mutual mistake: – for the rectification of
instrument, one has the proof regarding the fraud and the mutual
mistake. The intention must be truthful which is owing to fraud or
common mistake.
‘Fraud’ means an act done by any party through a contract to
deceive another party to enter into a contract.
‘Common mistake’ means when the mistake in any contract or in any
deed done by both the parties.
‘Real intention of the parties’ means it’s not only the party to prove
fraud or mutual mistake but also the court has to find out and further
the court has to also ascertain the real intention of the parties.
• The burden of proof lies on the person who wants rectification of
the instrument.
Parties To Rectification of Instrument:
Either party to a contract or their legal representative in interest can
take action for the rectification of the instrument under Section 26.
Any other person does not have any right to maintain a suit for its
rectification. Proper parties can apply for the same. ‘Proper parties’ are
those parties when a case is brought for rectification of sale deed at
that time the other parties who are affected by it are called proper
parties.
Effect of rectification of Instrument:
A deed can only be rectified by the court so as to confirm the true
intention of the executing party at the moment of execution. After the
execution the written agreement does not continue to exist with a
parol variation, it is to be read as if it had been originally drawn in its
rectified form. When the court rectifies a deed of transfer it becomes a
conveyance and so no further conveyance is required. The order
should be declared that the deed ought to be rectified, point out the
way in which it should be rectified and direct an endorsement of the
order on the conveyance.
Rescission of Contracts ([Sec. 27-30]:
Recession of Contracts:
Section 27 deals with the recession of the contract, in law, recession
means withdrawing of the contract or in simpler terms: cancellation of
the contract. It brings the party in a situation as if the contract did not
happen i.e status quo ante meaning in its original state.
Recession when cancelled:
A contract can go through the recession by the pleading of any party
except there are some cases in which recession may be cancelled.
Recession can be cancelled in certain ways:
a) where the contract has been terminated or “has been deemed”
voidable by the plaintiff,
b) when the contract is unlawful.
Steps for Recession
Basically, a notice is presented by the aggrieved party, addressed to
the opposite party stating the reasons for recession. In that notice, the
party declares its intention to rescind the contract and also asks that
money be refunded or compensation be paid. The notice results in
unilateral rescission.
Sections 27 to 30 of Specific Relief Act, 1963 deal with the rescission of
a contract. It is a type of legal redressal.
• Section 27 deals with a situation where the rescission may be
adjudged or refused,
• Section 28 deals with rescission in cases of contracts for the sale
or lease of immovable property,
• Section 29 deals with an alternative prayer for rescission and
• Section 30 the court may require the rescinding party to do
equity.
UNIT-4
Introduction:
The legal system in India provides for certain duties and obligations
which are to be performed by each party to a contract. A party found
in breach of any such duty or obligation is punishable under law. Along
with these duties, the laws also provide for certain reliefs to the parties
to a contract, in cases where a contract can be held questionable under
law. One such relief is the Cancellation of Instruments, which has been
mentioned under the Specific Relief Act, 1963. This article would help
the reader understand the different issues associated with the
Cancellation of Instruments under the Specific Relief Act, 1963.
Cancellation of instruments:
In simple language, cancellation of instruments means the nullification
of a written document which is proof of a transaction between the
parties that are part of the transaction. An instrument being every
document by which any right or liability is, or purports to be created,
transferred, limited, extended or extinguished as per the Indian Stamps
Act, 1899.
Cancellation of documents is dealt with under Sections 31, 32 & 33 of
the Specific Relief Act, 1963. If there is an instrument, which is void or
voidable due to some reason and a party to such an instrument has
enough reasons to believe that the said instrument has the potential to
act against him and may even cause serious injury to him, then such a
person can file a suit with regards to the cancellation of such an
Instrument. This is a discretionary relief and the reason behind such is
defined in the later stages of this article.
Cancellation of Instruments can be done in two ways, as follows:
• Complete cancellation where the court decides to cancel the
whole instrument.
• Partial cancellation where only a part of the instrument is
cancelled out. These types of cancellations are mentioned under
Section 32 in the Specific Relief Act and have been further
explained later in this article.
Main requirements for cancellation:
The cancellation of an instrument can be done by the Civil Courts on
request of a party to a transaction only after considering certain
requirements. A suit for cancellation of an instrument filed by a party,
shall be entertained only if any of the following requirements are met:
• If the instrument against which the cancellation suit is filed by the
party is void.
• If the instrument against which a cancellation suit is filed by the
party is voidable.
• If the instrument against which a cancellation suit is filed has the
potential to cause injury/harm to the party filing the suit.
• If the party who has filed a suit for cancellation of an instrument is
under reasonable apprehension of an injury being caused to
him/her due to the performance of the instrument.
• When the instrument whose cancellation is requested by the
party has already caused enough damage/injury to the requesting
party.
• In the view of all the circumstances of the case, the Court must be
satisfied that such cancellation of an instrument is reasonable and
would serve justice to the parties coming to the courts for such
claims.
If any of the above conditions/requirements are satisfied, then a
person may successfully proceed with a suit for the cancellation of an
instrument.
When cancellation is ordered:
The Specific Relief Act, 1963 under Section 31 tells us about when the
cancellation of an instrument may be ordered by a court. To begin
with, this Section under its first clause tells us that any person who is
aggrieved by the performance of a particular instrument and feels that
such an instrument has become void or voidable, or believes that the
instrument has the potential of causing injury/harm to him if such a
transaction is continued may file a suit at a Civil Court to have such an
instrument declared to be void. Once such a suit is filed it is upon the
Court to decide whether such an instrument should be declared void or
not. The Court has complete discretion in such matters. Thus, the Court
can order for the cancellation of such an instrument if the above-
mentioned requisites are fulfilled.
The second clause of Section 31 tells us that if an instrument which has
been put up in front of the Court for cancellation is a document which
has been registered under the Indian Registrations Act, 1908, then a
copy of such a decree containing details about the cancellation of the
instrument is required to be sent to the officer under whom the
instrument/document had been registered. Such a decree is sent for
the convenience of the officer and to keep his register updated. Upon
receiving the instructions/decree from the court, the officer is required
to mark the copy of the documents as “cancelled” in his register.
Partial cancellation of instruments

The process of partial cancellation of instruments is mentioned under
Section 32 in The Specific Relief Act, 1963.
This section says, that when a particular part of an instrument is up for
a question of cancellation in front of the court or when such an
instrument has several rights and obligations required under it, the
court upon its discretion may cancel only a part of that instrument and
let the rest of it stay as it is. Partial cancellation basically means that a
part of the instrument which is inconsistent, void or voidable shall be
cancelled by the court and such cancellation shall not have any effect
upon the performance of the other rights and obligations associated
with the instrument.
Power to require benefit or compensation:
The provisions with regards to the power of the Court, to require
restoration of benefits received and fair compensation which are
supposed to be made when an instrument is cancelled are provided
under Section 33 in the Specific Relief Act, 1963. The primary aim of
this section lies in serving justice to the participants of a particular
instrument/contract in case such is cancelled by the court.
This Section firstly tells us that when the court decides to cancel an
instrument either completely or partially, then the party towards
whom such relief is granted is required to either restore/claim any
benefits which he/she may have received from the other party or to
make the required amount of compensation for it. Such conditions are
put forth by the act with an intention to deliver justice to the parties,
as a court is a place that is responsible for delivering justice to the
people who approach it.
This Section also provides/states/lays the conditions under which, a
defendant to a suit for the performance of an instrument/contract may
claim for the cancellation of such an instrument/contract. The
conditions mentioned in Section 33 are as follows:
• When a plaintiff files a suit to enforce a contract against a
defendant and the defendant tries to resist the contract by
claiming such a contract to be voidable. In such a case if the court
is also of the opinion that the contract/instrument under
consideration is voidable, then the court may order for the
cancellation of such an instrument/contract.
• When a plaintiff files a suit to enforce a contract against a
defendant and the defendant tries to resist the contract by
claiming such contract to be void because of the defendant not
being competent to participate in a contract under Indian Laws.
Competence to enter into a contract is defined under Section 11
in the Indian Contracts Act, 1872. Competence to enter into a
contract can be judged by conditions such as age, soundness of
mind, etc. In such a case the instrument/contract shall be
cancelled by the court.
With regards to the above-mentioned conditions if an order of
cancellation is passed by the court with regards to an instrument, then
the defendant shall have to restore the benefits he/she has received
from the other party while the performance of such
contract/instrument and the defendant shall also be asked to
compensate the other party i.e. the plaintiff accordingly, to satisfy the
purpose of the court in serving justice.
Declaratory Decree [Sec. 34-35]
Introduction:
If you’ve ever wondered why the Concept of ‘declaratory decree’
emerges and for whom it comes into the picture, here’s everything you
need to know. This whole article deals with the concept of ‘declaratory
decree’ and what are the essentials of filing declaratory suit, whether
the court can exercise its discretion in the case of the declaratory
decree and if yes, under what circumstances. This article also deals
with other aspects of ‘declaratory decree’.
Declaratory decrees:
The declaratory decree is the edict which declares the rights of the
plaintiff. It is a binding declaration under which the court declares
some existing rights in favour of the plaintiff and declaratory decree
exists only when the plaintiff is denied of his right which the plaintiff is
entitled to. After that specific relief is obtained by the plaintiff against
the defendant who denied the plaintiff from his right.
According to Section 34, of the Special Relief Act, 1963, 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.
Declaratory decree provisions bring out to merely perpetuate and
strengthen the Plaintiff in case of an even adverse attack so that the
attack on the Plaintiff can not weaken his case and it is mentioned in
the case of Naganna v. Sivanappa. And by the arguments made in this
case, it encourages the plaintiff to come forward to enjoy the rights
which they are entitled to and if any Defendant denied the Plaintiff
from providing any rights for which the Plaintiff is entitled, then it gives
them the power to file the suit and get special relief.
Discretion of court as to declaration of status :
As in the Section 34 of Special Relief Act, 1963 the condition mentioned
for the declaration of status or right i.e.
(1) the plaintiff at the time of suit was entitled to any legal character or
any right to any Property
(2) the defendant had denied or was planning or interested in denying
the rights of the plaintiff
(3) the declaration asked for should be same as the declaration that
the plaintiff was entitled to a right
(4) the plaintiff was not in a position to claim a further relief than a
mere declaration of his rights which have been denied by the
defendant. But, it is not compulsory that even after the fulfilment of all
the four essential conditions required for declaration, the specific relief
will be provided through a declaration to the plaintiff. It is totally on
the discretion of the court whether to grant the relief or not to the
plaintiff. The relief of Declaration or specific relief cannot be asked as a
matter of right, it is a total discretionary power which is in the hands of
the court.
In the case of Maharaja Benares vs. Ramji khan, it was declared that if
the suit is filed and the necessary party is absent then the court will
dismiss the suit for the declaration. So, it is necessary that both parties
should be available. There is no specific rule to decide whether the
discretionary power of the courts should be granted or not, the
discretionary power of the court is being exercised according to the
case and there are no specific criteria to decide in which cases the
court will exercise its discretionary power.
Essentials of a declaratory suit:
There are a total of four essential elements considered for a
declaratory Suitor for the valid suit for Declaration and all the four
elements are mentioned below.
• The plaintiff at the time of suit was entitled to any legal character
or any right to any Property.
• The defendant had denied or was planning or interested in
denying the rights of the plaintiff.
• The declaration asked for should be the same as the declaration
that the plaintiff was entitled to a right.
• The plaintiff was not in a position to claim a further relief than a
mere declaration of his rights which have been denied by the
defendant.
Requisites:
According to the Section 34 of the Special Relief Act, 1963 it put
forward certain conditions which are to be fulfilled by the plaintiff to
file a valid suit for declaration for the rights which is denied by the
defendant. In the case of the State of M.P. vs. Khan Bahadur
Bhiwandiwala and co., The court observed that in order to obtain the
relief of declaration the Plaintiff had to fulfil the four conditions as
mentioned above.
The object of Section 34 of the Special Relief Act, 1963 to provide a
perpetual bulwark against adverse attack on the title of the Plaintiff
and to prevent further litigation by removing the existing cause of
controversy. If any of the essential elements are missing then the court
will not provide any relief of declaration. The Plaintiff has to prove that
the defendant has denied or is interested in denying to the character
or title of the Plaintiff and the Plaintiff has to establish that there must
be some present danger to his interest. The denial must be
communicated to the Plaintiff in order to give him a cause of action.
The court must exercise their rights while granting declaratory decree
and only in proper cases, this legal remedy should be granted so as to
avoid multiplicity of suits and to remove clouds over legal rights of a
rightful person.
Legal Character:
We have talked about the requisites that a person should be entitled to
the legal character. So, what we mean about the Legal Character. Legal
character is attached to an individual’s legal status which shows the
person’s capacity. Legal character by names itself denotes character
recognized by law. In the case of Hiralal v. Gulab, it was observed that
variety of status among the natural person, can be referred to the
following listed causes i.e. Sex, minority, rank, caste, tribe, profession
any many more list.
Person Entitled to any Right to Property:
The second condition which is to be fulfilled by the Plaintiff for the
successful relief of Declaration or we can just say that for getting
Special relief which should be related to Plaintiff Right to Property. A
person seeking special relief has a condition that they must have a
right to any property, only then they can go for special relief under
Special relief Act, 1963. The Bombay High Court has made a distinction
in ‘Right to Property’ and ‘Right in Property’ and it has been held that
to claim and go for a declaration the Plaintiff need not show the right
in Property. The Plaintiff only has to show that he has Right to Property
from which he has been denied.
Declaration asked should be the same as the declaration that the
plaintiff entitled.
The third condition is to be fulfilled by the Plaintiff for the Declaration
and for Special relief. This is considered as essential because it is very
necessary to look that the Plaintiff asking for the declaration from the
Court should be the same as the declaration to which the Plaintiff is
entitled under the right to any Property.
Plaintiff should claim only for mere Declaration
The fourth and the last one which is to be fulfilled by the Plaintiff is
that the suit filed by the Plaintiff should claim only for mere declaration
and he is not entitled to more than that. Excess relief seeking suits will
not be entertained by the court in any manner and there is no
restriction or any hard and fast rule to entertain such cases where the
suit filed is seeking relief more than just mere declaration.
When suit for declaration is not Maintainable:
• A suit for the declaration will not be maintainable under some

circumstances which are to be mentioned below.
• In the case of a declaration that the Plaintiff did not infringe the
defendant’s trademark.
• For a declaration that during the lifetime of the testator, the will is
invalid.
• No one can ask for a declaration of a non-existent right of
succession.
• A suit by a student against a university for a declaration that he
has passed an examination.
Effect of declaration:
Before going into an in-depth analysis of what is the effect of the
Declaration, first, we should look at what it is according to Section 35
of the Special Relief Act, 1963. According to this Section, a declaration
made under this section is binding on both the parties to the suit and
the 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 declaration, such parties would be trustees.
Lets understand how the effect of the declaration is being in process
with the help of an illustration i.e. Ram, a Hindu, in a suit to which
Komal, his alleged wife, and her mother, are defendants, seeks a
declaration that his marriage was duly commemorated and an order
for the restitution of his conjugal rights. The court makes the
declaration and order. Shumbham claims that Komal is his wife, then
sues Ram for the recovery of Komal. The declaration made in the
former suit is not binding upon shubham.
Conclusion:
Declaratory decree is a provision which focuses on the rights of the
Plaintiff and gives immense power to the Plaintiff to deal effectively
against the defendant. How the court uses their discretionary power
under what circumstances and other aspects analysis helps the reader
also to analyse and understand the Declaratory decree concept in the
simplest way. According to my opinion and analysis, Declaratory decree
is a concept which is to be wider and covers more aspects than it
currently does and the main thing according to my opinion should be
amended in a long-term is that there should be a limitation on the use
of discretionary power by the different courts and fixation should be
done in which cases or in which type of cases, the discretion of court
can be used.
Injunctions:
What is Injunction?
Injunction litigation is a crazy ride consisting of low points, high points,
twists, turns, and challenges. An injunction by its very name means a
preventive relief. The grant of an injunction is an equitable remedy that
prevents a defendant party from doing certain demonstrations or
certain acts so that they are not bothersome or do not cause any
nuisance to the plaintiff.
When a court comes with a judgment in such a suit, the parties must
abide by and adhere to the ruling, in the absence of which there can be
severe monetary penalties or even imprisonment in a few cases.
Explanation of important terms
• Prima facie– The word “prima facie” means either on first sight or
on the first presence or on the face of it. Prima facie case means
that recorded evidence should fairly enable the complainant’s
search for the inference.
• Irreparable injury– “Irreparable harm” means any injury that
cannot be fixed by damages adequately. The remedy in the form
of damages would be insufficient if any is payable to the plaintiff
in the case of victory in the litigation. It will not put him in the
place where he was before the injunction was denied.
• Balance of Convenience– The question of balance of convenience
arises where there is uncertainty as to the satisfactorily of the
respective remedies in damages available to either party or both.
The parties must strike a proper balance and the balance can not
be a one-sided affair.
Kinds of injunction:
The Specific Relief Act, 1963 discusses the various types of injunctions.
To prevent possible future injury to the plaintiff, the plaintiff would
have to bear if the relief is refused, there are certain kinds of
injunctions provided as mentioned below:
• Temporary Injunction
• Perpetual Injunction
• Mandatory Injunction
What is Temporary injunction?
Under the Specific Relief Act, 1963, Section 37 deals with a temporary
injunction. Temporary injunctions continue for a specified period of
time or until the further order of the court. They may be allowed at any
stage in a suit and are managed by the Code of Civil Procedure (1908).
The essential purpose for granting this injunction is to secure the
interests of an individual or the property of the suit until the final
judgment is passed. The factors looked into while providing such an
injunction are:
I. If a party has a case of prima facie?
II. If the balance of convenience is in favor of the complainant.
III. Whether the plaintiff would suffer irreparable damages before the
judgment is passed?
The time period of such an injunction is dependent on the discretion of
the court. This kind of injunction was also provided as under the case
Union of India v. Bhuneshwar Prasad.
Some examples of cases stated in the CPC where temporary
injunction can be granted are:
• Where any property in dispute in a suit, which is probable of

getting wasted, destroyed or estranged by any party to the suit, or
illegally sold in execution of a decree; or
• Where the defendant threatens to remove or dispose of his
property in order to defraud his creditors; or
• Where the defendant threatens to deprive the plaintiff of his
property or threatens to cause injury to the plaintiff in connection
with the property in dispute in the suit; or
• In any case to prevent the defendant from committing a breach of
a contract or any other injury;
• Where pursuant to sections 38 and 41 of the Specific Relief Act,
no perpetual injunction or mandatory injunction could be granted;
Provided that, where it is proposed to grant an injunction without
notice to the other party, the Court records the reasons for its view
that the purpose of granting the injunction would be defeated by
delay and requires the applicant to:
(a) deliver to or send to the other party by registered post, immediately
after the order of granting the injunction,
(i) a copy of the request for the injunction together with a copy of the
affidavit filed in support of the request;
(ii) a copy of the complaint; and
(iii) a copy of the documents on which the applicant relies;
(b) to file, on the day on which such injunction is granted or on the day
immediately following that day, an affidavit stating that the copies
aforesaid have been so delivered or sent.
What is Perpetual Injunction?
When perpetual injunction is granted by the judgment it ultimately
disposes of the injunction suit. It is ordered at the time when final
judgment is given. It is a final relief injunction and is not given on an
interim basis. The granting of a perpetual injunction is defined
under Section 37 (2) of the Specific Relief Act, 1963. The section says
that only by the decree issued after an inquiry and on hearing the
merits of the case can a perpetual injunction be granted; the defendant
is thus perpetually enjoined to exercise his right or to forever pervade
his conduct which would be in conflict with the rights of the plaintiff.
According to Section 38 of the aforesaid Act, the perpetual injunction
can be granted to the plaintiff when:
(1) In order to avoid a breach of duty in his favor, either specifically or
by consequences, subject to the other requirements contained or as
provided for in this Section; and
(2) If such obligations occur out of the contract, the court shall be
directed by the provisions and rules contained in Chapter II of the
Specific Relief Act, 1963; and
(3) When the defendant invades or attempts 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 the plaintiff’s property custodian;
(b) where there is no standard for the determination of the actual
damage caused, or where the invasion can reasonably be caused;
(c) where the invasion is such that adequate aid and help cannot be
provided by compensation in money;
(d) where the injunction is required to avoid the ever-rising increase in
the no.of multiplicity of judicial proceedings. Thus, there are different
reasons for the existence of a perpetual injunction.
The plaintiff must prove the breach of the obligation by showing the
infringement of a legal right, thus the burden of proof lies with the
plaintiff. The plaintiff must also lawfully possess the item and must
prove that the defendant had no legal possession over the item.
Injunction cannot be sustained on the basis of wrongful possession
against the lawful owner.
The continuance of possession by the lessee (a person who holds the
lease of a property; a tenant) without the consent of the lessor (a
person who leases or lets a property to another; a landlord) may not be
“lawful possession” but it is “juridical possession” and the juridical
possession is protected by law and injunction can be granted in such
cases.
Ownership and lawful possession are two different things, a person can
be evicted by the process of law and such a person can resist any kind
of invasion by the real owner and may be granted injunction. The
contract for litigation fund is not per se illegal and the court can grant
an injunction to protect the rights of the plaintiff arising out of the
obligation. In the case of Nuthaki Venkataswami v. Katta Nagi
Reddy, the court held that the champertous agreement in itself is not
void and if the recovery is not against public policy, they can’t be called
illegal and thus injunction may be granted.
In the case of Walter Louis Franklin v. George Singh, where the plaintiff
filed a pleading before the court to grant perpetual injunction to
restrain the defendant from unlawfully using his land where the
defendant claimed that he was the real owner, the court, however,
held that the perpetual injunction shall be granted as the land was in
the possession of the plaintiff.
What is Mandatory Injunction?
Section 39 of the Special Relief Act, 1963 deals with the Mandatory
Injunction. The section doesn’t clearly define mandatory injunction but
deals with the grant of a mandatory injunction. The section says that in
order to prevent the breach of an obligation the court can compel the
performance of certain actions at its discretion which it is capable of
enforcing and can issue injunctions for the infringement complained
of. The principle of mandatory injunction is used to grant final relief
and not the interim reliefs like in exceptional or exemplary cases like
saving life, etc. There are essentially two conditions requested for
mandatory injunctions:
(a) the defendant must be obliged to perform an act and any such
breach of the obliged act must be claimed by the plaintiff;
(b) the reliefs, as asked for must be enforceable by the court. The
principle says that the defendant must do a positive act in order to
restore the wrongful act committed by him.
In Dorab Cawasji Warden v. Coomi Sarab Warden, the Supreme Court
held that:
1. The complainant must present a strong case in the court and it
should be of a level higher than that of the prima facie case;
2. the plaintiff must make it clear that the grant of a mandatory
injunction is obligatory to prevent irreparable damage or serious
injury which cannot be compensated in terms of money; and,
(c) the balance of convenience should also be in favor of the
complainant as against the defendant.
Prohibitory Injunction:
Prohibitory Injunctions are explained under Section 38 of the Specific
Relief Act, 1963. As the name suggests, a prohibitory injunction
prohibits or forbids the commission of some act. Such an injunction
may be granted to the plaintiff to prevent the breach of obligation,
existing in his favour. The ‘obligation’ may be of any kind i.e. it could be
contractual, tortuous, under a trust etc.
Illustration A, B and C are members of a Hindu undivided family. A cuts
Timber growing on the family property and threatens to destroy a part
of the family house to sell some of the utensils of the family. Now, B
and C can sue for injunction to restrain a from doing search threatened
act.

Law Relating To Equity

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BY-YOGESH BHADANA MOB-8684864304

LAW RELATING TO EQUITY, TRUST AND SPECIFIC RELIEF

Unless all the above requisites are fulfilled, a trust cannot be

PROCEDURE OF CREATION OF A TRUST DEED:

• A trust deed may be created using any language sufficient to show

• Disclaimer by the trustee- a trustee may within reasonable period

Remedies for Breach of Trusts:

• After the expiry of six months from the date of dispossession.

• The suit must relate to the specific performance of contract.

• In all cases where the contract is for the transfer of immovable

value or of specialinterest to plaintiff.

➢ The property is held by the defendant as an agent or trustee of

(2) Where a party to a contract is unable to perform the whole of his

Where specific performance of material terms cannot be enforced:

A contract which is in its nature determinable:

A contract the performance of which involves the performance of a

8. If the promoters of a company entered into a contract before for

Partial cancellation of instruments

• A suit for the declaration will not be maintainable under some

• Where any property in dispute in a suit, which is probable of

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