Law of Contract and Specific Relief
Paper 6 tests the Indian Contract Act, 1872 as the foundation of every commercial transaction, together with the Specific Relief Act, 1963, which decides what a wronged party can actually get. Questions are fact-pattern based, so attach each rule to the facts given.
Formation
- Agreement = offer plus unqualified acceptance; a counter-offer destroys the original offer.
- Consideration under s.2(d) may move from a third party, not only from the promisee.
- Section 25 exceptions: a written and registered promise made out of natural love and affection between near relatives; compensation for past voluntary service; a promise to pay a time-barred debt; a completed gift.
- A minor's agreement is void ab initio and cannot be ratified on attaining majority.
- Consent must be free (ss.14–19). Bilateral mistake of essential fact (s.20) makes the agreement void; unilateral mistake generally does not.
Discharge and breach
Performance, agreement, impossibility (s.56) or breach. Section 73 compensates loss naturally arising in the usual course; section 74 gives reasonable compensation for a stipulated sum, not automatically the full amount.
Specific Relief
After the 2018 amendment, specific performance is the rule (s.10) and refusal the exception, limited by ss.14 and 16. Section 16(c) requires the plaintiff to plead and prove readiness and willingness. Injunctions sit in ss.36–42; declaratory relief in s.34.
Worked example. A contracts to sell a flat to B for ₹50 lakh, takes ₹5 lakh advance, then sells to C. B may sue for specific performance: the property is identified, no s.14 bar applies, and B must show continuing readiness and willingness and deposit the balance. B may alternatively claim damages under s.73.
Traps. Treating void and voidable agreements as synonyms; forgetting that readiness and willingness is a continuing requirement; missing the three-year limitation for specific performance.