India: The Specific Relief (Amendment) Act, 2018

November 19, 2018

The business transactions have been an important mode of interaction between different strata of people. The parties involved therein are often confronted with the challenges posed by changing circumstances resulting in clash of view-points. Difference may result in delayed performance, termination of agreement, etc. Remedies available for the losses incurred due to improper discharge of an agreement include equitable remedy of law for the breach committed, injunction, compensation in the form of damages or requiring specific reliefs applicable.

The Specific Relief Act, 1963

In order to ensure the specific relief to the individuals or entities in furtherance to the enforcement of their civil rights, the Specific Relief Act, 1968 (hereinafter referred to as the “Act”) was introduced. In certain cases where no amount of compensation or any other legal remedy can mitigate losses of the suffering party, such party may seek relief requiring performance of the specific obligations undertaken in the original agreement between the parties.

Amendment to Specific Relief Act

The Government brought forth modifications in the provisions of the Specific Relief Act for the effective management of the same on August 1, 2018 vide the Specific Relief (Amendment) Act, 2018 (hereinafter referred to as the “Amendment Act”). Some of the features of the said Amendment Act are listed below:

  • Section 10 of the Act – The specific performance of a contract shall be enforced by the court of law subject to the contracts which cannot be specifically enforced as provided in Sections 11(2), 14 and 16 of the Act.
  • Section 14 of the Act – The following contracts cannot be specifically enforced, namely:
    • where a party to the contract has obtained substituted performance of contract as per Section 20 of the Act;
    • a contract, the performance of which involves the performance of a continuous duty which the court cannot supervise;
    • a contract which is so dependent on the personal qualifications of the parties that the court cannot enforce specific performance of its material terms; and
    • a contract which is in its nature determinable.
  • Section 14A of the Act – Where the court considers it necessary to get expert opinion to assist it on any specific issue involved in the suit, it may engage one or more experts for providing evidence, including production of documents on the issue which shall be based on relevant information and form a part of the record.
  • Section 15(fa), Section 19(ca) of the Act – Specific performance of a contract may also be obtained when a limited liability partnership has entered into a contract and subsequently becomes amalgamated with another limited liability partnership, the new limited liability partnership which arises out of the amalgamation.
  • Section 20 of the Act – Substituted performance of contract may be allowed without prejudice to the generality of the provisions contained in the Indian Contract Act, 1872, and, except as otherwise agreed upon by the parties, where the contract is broken due to non-performance of promise by any party, the party who suffers by such breach shall have the option of substituted performance through a third party or by his own agency, and, recover the expenses and other costs actually incurred, spent or suffered by him, from the party committing such breach after the party who suffers such breach has given a notice in writing, of not less than thirty days.
  • Section 20A of the Act – Special provisions for contract relating to infrastructure project stating that no injunction shall be granted by a court in a suit in this regard which would cause impediment or delay in the progress or completion of such infrastructure project.
  • Section 41(ha) of the Act – An injunction cannot be granted if it would impede or delay the progress or completion of any infrastructure project or interfere with the continued provision of relevant facility related thereto or services being the subject matter of such project.

The changes brought about by the Amendment Act are in furtherance to objectives of the Act to prevent the obligator from refraining to fulfil the promises made by him which may be detrimental to the interests of the other party.

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