Specific Performance of a contract a General Rule

The law of specific performance, as enshrined in the Specific Relief Act of 1963 (“the Act”), is a crucial aspect of civil law. The Act, among other things, addresses most areas of contract performance as well as injunctive remedies that can be given and demanded. This project will familiarize and guide us through the basic principles and crucial considerations to keep in mind while seeking the particular performance of contracts involving immovable property and associated concerns.

In the case of moveable property, the usual practice is that a particular remedy is denied because there is a presumption that the failure to comply may be compensated in monetary terms under Section 10 of the Act as it is. Even though Section 10 of the Act has been changed, this does not imply that a particular performance for moveables will be given in most cases. The law will continue to provide and suppose that a violation of a contract involving moveables can be reimbursed, and hence deny performance. The exception will be made, among other things, if the moveable property is not a common commodity of trade, is of unique worth or interest to the plaintiff, or comprises products that are not readily available in the market.

Specific Performance: Mandatory

Section 10 now reads as follows: The court shall enforce the particular fulfillment of a contract under the terms of paragraph (2) of sections 11, 14, and 16.

The new text of Section 10 of the Specific Relief Act represents a significant divergence from the previous system in terms of allowing specific execution of contracts. This intent is reflected in the Statement of Objects and Reasons for Presenting the 2018 Amendment, which states that the amendment was introduced to eliminate the broader discretion vested in Indian courts to grant specific performance and to make specific performance of contract “a general rule rather than an exception subject to certain limited grounds.”

 This clause, which had previously been left to the Court’s discretion, was made mandatory, establishing a power for the Courts to execute when the ingredients were met. This was a key step forward in the development of business law since it enhanced the sanctity of contracts by requiring parties to comply with contracts, decreasing efficient violations. One of the key reasons for granting particular performance under the amended Particular Relief Act was the sufficiency of damages under Section 14(1)(a). This factor, however, has recently been eliminated to give greater recompense to the injured party in the form of specified performance.

Case Law

In the case of Global Music Junction Pvt. Ltd. v. Shatrughan Kumar aka Khesari Lal Yadav & Ors., the Delhi High Court held that the Specific Relief (Amendment) Act of 2018 transformed the nature of specific relief from an equitable, discretionary remedy to a statutory remedy, making contract execution a general rule rather than an exception.

The Appellant has filed a suit seeking permanent injunction, rendition of accounts, and damages for alleged infringement of the Appellant’s copyright in certain literary works, musical works, cinematographic films, and sound recordings by the Respondents.

This Court stated that as a result of the modifications brought about by the Amendment Act, 2018, the Courts will henceforth grant particular performance unless the claim for relief is prohibited under the statute’s limited grounds. This amendment is intended to provide more contractual protection by assuring that a non-defaulting party can achieve the performance it bargained for. The Amendment Act, 2018, seeks to deter errant parties who may believe it is more profitable to break a contract than to fulfill it, because the cost of damages may still be less than the cost of performance.

The Amendment Act of 2018 also brought the Indian Specific Performance Act in conformity with the UNIDROIT Principles of International Commercial transactions, to achieve harmonization in international law regulating commercial transactions.

As a result, the Amendment Act of 2018 transformed particular relief from an equitable, discretionary remedy to a statutory remedy. It has made specified contract performance a general rule rather than an exception.

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