PART II SPECIFIC RELIEF · CHAPTER IV RESCISSION OF CONTRACTS

Section 27: When rescission may be adjudged or refused

The Specific Relief Act, 1963

(1) Any person interested in a contract may sue to have it rescinded, and such rescission may be adjudged by the court in any of the following cases, namely:—

(a) where the contract is voidable or terminable by the plaintiff;

(b) where the contract is unlawful for causes not apparent on its face and the defendant is more to blame than the plaintiff.

(2) Notwithstanding anything contained in sub-section (1), the court may refuse to rescind the contract—

(a) where the plaintiff has expressly or impliedly ratified the contract; or

(b) where, owing to the change of circumstances which has taken place since the making of the contract (not being due to any act of the defendant himself), the parties cannot be substantially restored to the position in which they stood when the contract was made; or

(c) where third parties have, during the subsistence of the contract, acquired rights in good faith without notice and for value; or

(d) where only a part of the contract is sought to be rescinded and such part is not severable from the rest of the contract.

Explanation.—In this section “contract” in relation to the territories to which the Transfer of Property Act, 1882 (4 of 1882), does not extend, means a contract in writing.

Questions on this section

4 questions in 12 of our papers cite Section 27. Try these from the free papers:

1. Under Section 27(2) of the Specific Relief Act, 1963, the court may refuse to rescind a contract in which of the following cases? 1. The plaintiff has expressly or impliedly ratified the contract. 2. Third parties have, during the subsistence of the contract, acquired rights in good faith without notice and for value. 3. Owing to a change of circumstances caused by the defendant's own act, the parties cannot be substantially restored to their original position. 4. Only a part of the contract is sought to be rescinded and that part is severable from the rest. Select the correct answer using the codes below:
2. B was induced by A's fraudulent misrepresentation to enter into a contract with A, so the contract is voidable at B's option. B has not ratified it, and no third party has acquired rights under it. B sues A to have the contract rescinded. Under Section 27 of the Specific Relief Act, 1963, rescission:

Practise questions on Specific Relief Act