To be Done or Undone? Why not?

(By Biju Menon K., Additional District Judge, Thiruvananthapuram)

Criminal trials have always been tedious and time-consuming for all stakeholders, the accused, lawyers and judges. Unlike in civil cases where lawyers and clients have the advantage of pleadings, a criminal lawyer is faced with the uphill task of analyzing and attacking chief examination of prosecution witnesses aided by their statements to the police, mostly in search of contradictions. Any criminal lawyer will tell you how arduous the task is. For a judge, the tediousness is on the legal duty of recording the entire evidence and putting it to the accused for a routine denial. True that Section 313 of Cr.P.C. provides an opportunity to obtain his stand on facts in evidence against him, otherwise entitled to a stoic silence in the scheme of the Code of Criminal Procedure.

The Section as it stood before Act 5 of 2009 introduced with effect from 31/12/2009:

313. Power to examine the accused

(1)In every inquiry or trial, for the purpose of enabling the accused personally to explain any circumstance appearing in the evidence against him, the Court-

(a)may at any stage, without previously warning the accused,put such questions to him as the Court considers necessary;

(b)shall, after the witnesses for the prosecution have been examined and before he is called on for his defence, question him generally on the case:

     Provided that in a summons-case, where the Court has dispensed with the personal attendance of the accused, it may also dispense with his examination under clause (b).

(2)No oath  shall  be administered to the accused   when   he   is   examined   under   sub­-
section (1).

(3)The accused shall not render himself liable to punishment by refusing to answer such questions, or by giving false answers to them.

(4) The answers given by the accused may be taken into consideration in such inquiry or trial, and put in evidence for or against him in any other inquiry into, or trial for, any other offence which such answers may tend to show he has committed.

With the salutary object of doing away the long standing, at times misunderstood, requirement of putting each and every item of evidence mostly ending up in the entire deposition being put across, Act 5 of 2009 brought in Clause (5) reading thus:

Section 313(5). The Court may take help of Prosecutor and Defence Counsel in preparing relevant questions which are to be put to the accused and the Court may permit filing of written statement by the accused as sufficient compliance of this section.

Suresh Chandra Jana v. State of West Bengal & Ors.(2017)16 SCC 466 ruled against the practice of re-writing and putting each sentence of the prosecution evidence to the accused under Section 313 Cr.P.C. It was held that:

We have also perused the questions put under S.313 of the Code of Criminal Procedure and answers given by the accused which are on the record. We do not find that in the present case spirit of S.313 is forgotten, nor it can be said that the court has not complied with said provision. Sub-section (b) of S.313 requires the court to question the accused generally on the case after the prosecution evidence is over.  It does not require to re-write hundred pages evidence in another hundred pages to record the statement of the accused under the Section. It should be borne in mind that entire evidence has been recorded in the presence of the accused or his counsel, and before he enters into his defence, what is required is that he is generally asked on the case, after the prosecution evidence is over, to explain any circumstances in the evidence against him. It does not require that each and every sentence of the prosecution evidence has to be re-written and read over once again while examining the accused under S. 313 of the Code of Criminal Procedure.

Why then should we go with the old practice? Are we imbibing the true intendment of Act 5/2009? The thoughts of the Law Commission in its 154^th report reveal the object of the amendment:

“The accused in compliance with the provision can file written statements with the permission of the court. In Tilekeshwar Singh v. State of Bihar,in a prosecution for murder u/S.302 read with Section 34 of I.P.C., the Supreme Court found that written statements were filed by the accused under Section 342 of the Code of Criminal Procedure, 1898 and they were found to be very elaborate and furnished answers to all the points raised in the prosecution evidence. Though the examination of the accused was not in the question-answer form, the Supreme Court found that by filing of written statements, no prejudice was caused to him.

Certainly it is time to make innovative compliance of the amendment and endeavour to streamline our criminal justice system. Is it not enough to ask the accused to give a general statement on the core of the prosecution case as adduced in evidence and then obtain a statement in writing elaborating the same? The answer, to me, should be in the affirmative.c

Remembering the Forgotten Right !

(By R.S. Aswini Sankar, Advocate, High Court of Kerala)

“Do not allow me to forget you !”   -- Gabriel Garcia Marquez ¹

Key words : Right to Forgotten/Erasure - privacy and dignity - Data protection Bill - free speech and right to know-the Personal Data Protection Bill, 2019

Is to forget a Right? How can we insist a person to forget someone or something? Even though the term is little bit confusing, one should re-read the same within the digital parameters. Right to forgotten is the right to erase out or remove the personal data from internet searches or any social media platform and other directories. It is otherwise called as right to erase also.

For definition purpose we can say the right to be forgotten as “the ability of individuals to limit, de-link, delete, or correct the disclosure of personal information on the internet that is misleading, embarrassing, irrelevant, or anachronistic.”²

There is an opinion that the term Right to forgotten is a little bit confusing and even misleading. Once a professor at Oxford University, opined that the entire right was “particularly misnamed.” But in actual sense it doesn’t mean to erase the entire past by a single order or to process like censorship. As Shakespeare said what in a name, a rose is always a rose which smell sweet, in whatever name it is called.

For instance, consider a case of rape victim. Her photos are published in an online platform and the details are published in it. She wants to erase all details which help to identify her. What is her option? In the above like situation and those similar to this, there comes the Right to be forgotten as a rescue.

Whether this right can be treated as a human rightor not is still in a debating point. Digital human right activists have a concern about this right to forgotten and they are demanding for the same under the head of right to privacy. My data is my privacy. My data is my property. I have the right to disclose with you, or gave consent to you to share and also I have the authority to withdraw the consent ask you to remove the same from a public platform.

There are multiple views in treating the erasure right as a human right. Advocates of right to erasure drag this right under the privacy right of a man. Likely Article 12 of the Universal Declaration of Human Rights (“UDHR”), magna carta of international human rights, read out that No one shall be subjected to arbitrary interference with his privacy, family, home or correspondence, nor to attacks upon his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks.

If this is so, then then the right to erasure, which stands for delinking the data which effect the dignity and privacy of the individual also come under this article. At the same time there is a view that, this right is against another basic human right, i.e., the freedom of expression and right to information. But there is no internationally recognised treaties, charters or other documents in favour of this forgot right is a challenge. Lack of internationally enforceable machinery is a major drawback for this right because if the de­linking by a search engine in India, will be still available in other countries. Privacy and dignity is against the whole world and not limited to one state’s jurisdiction.

Privacy and dignity are the foundation of erasure right in India and that can be traced out in Article 21³ of the Constitution of India. Right to life has a wide spectrum which includes privacy, dignity, livelihood, speedy trail, environment, legal aid, education etc. etc.

Supreme Court has construed the dignified life as fundamental, along with the right to life in Oliga Tellis v. Bombay Muncipal Corporation & Ors.⁴, Francis Coralie v. Union Territory of Delhi ⁵etc. In many a cases including that in Francis Coraliecase⁶, the Apex Court quoted the observations made by Field, J. in case Munn v. Illinois by the term ‘Life’ something more is meant than mere animal existence.⁷ Further in that case⁸ it is observed by the Apex Court “that right to life includes the right to live with human dignity”.

Privacy is a part of life. In Justice K.S.Puttaswamy (Retd.) v. Union of India⁹the Supreme Court declared the right to privacy as a fundamental right. Observations made by the Supreme Court of South Africa in NM & Ors. v. Smith & Ors. emphasised in above case is relevant in our concerns about the right to forgotten also.

To quote.

“An implicit part of this aspect of privacy is the right to choose what personal information of ours is released into the public space. The more intimate that information, the more important it is in fostering privacy, dignity and autonomy that an individual makes the primary decision whether to release the information or not. That decision should not be made by others.”

These two rights, privacy and dignity constitute the base of right to forgot. Sometimes, information available in the digital platforms need to be regulated, withdrawn for the protection of fundamental right of privacy and dignity. As rape victim has the right to forgotten of reports published in online platforms to safeguard her privacy and dignity, the essentials of the glorified right to Life.

It’s true, Article 21 is the base for the right to forgotten. But the same shall be used without curtailing the freedom of speech, expression and information. Right to freedom of speech and expression is a right available to us directly under the Article 19(1) (a) of the Constitution of India.

The freedom of information was also incorporated in Indian Constitution by the Supreme Court through its powerful decisions. The series of Supreme Court decisions include Romesh Thappar v. State of Madras,¹⁰ Hamdard Dawakhana v. Union of India,¹¹ Bennett Coleman v. Union of India¹², State of U.P. v.Raj Narain¹³, Sheela Barse v. Union of India¹⁴Reliance Petrochemicals Ltd. v. Indian Express Newspapers Bombay (P) Ltd.¹⁵etc.

In Reliance Petrochemicals Ltd.¹⁶Case, Justice Mukherji, observed that:

‘Right to know is a basic right which citizens of a free country aspire in the broader horizon of the right to live in this age on our land under Article 21 of our Constitution. That right has reached new dimensions and urgency. That right puts greater responsibility upon those who take upon themselves the responsibility to inform.’’

There is no doubt regarding the fundamental status of right to know along with the freedom of speech and expression expressly provided under the Constitution¹⁷. Precautions must be taken before curtailing these rights. The rights especially fundamental rights shall be balanced while applying the principle of forgotten. The report of Justice Sreekrishna Committee, suggests a balancing test for the right to forgotten and issues that must be taken into consideration. The first one is the difficulty in control of spread of data subsequent to the disclosure of the personal data and the second one is that whether restriction of disclosure immediately affects the right to free speech and expression. The Committee further state that “The appropriateness of a right to be forgotten in these circumstances would require that the right to privacy be balanced with the freedom of speech.”

Consent for disclosure is also relevant in the right to forgotten issue. Where a disclosure has taken place on the basis of the consent of a data principal, it would be appropriate that the unilateral withdrawal of such consent could trigger the right to be forgotten. In other cases, where there is a conflict of assessment as to whether the purpose of the disclosure has been served or whether it is no longer necessary, a balancing test that the interest in discontinuing the disclosure outweighs the interest in continuing with it, must be carried out. The balancing tests are relevant only when there is no consent is there in publication.

Suppose a girl is posting a picture along with her boyfriend, in her Instagram account and the same was shared by many followers of her. The publication of the same is happened here with the consent of the data principal. Suppose, the relationship broken down and they want to erase their memories and also this photograph. They can withdraw the consent given to the social media account and ask them for non-disclosure. Consider it in another angle. The boy, who is also in the picture of the girl does not want to get tagged or want to remove the picture from the searches and the platform he can also request for the same before the data fiduciary, because of the privacy concerns.

Here in the first instance the girl gave the consent so there is no issue of hearing the other side. Unilateral withdrawal is enough. But in the second instance, the boy is the data principal, but the data is published by the girl in the data fiduciary account. Before taking a decision about the privacy violations and infringement of rights of the boy, the girl who is a publisher here must also be heard. Like this, opportunity of hearing must be given to the medias who report and publish personal data of the other.

Let’s look into some land mark cases having some international relevance as they laid foundation for the growth of the right to forgotten. Google Spain v. AEPD¹⁸is the leading case which opened the doors of Right to forgotten, internationally. Here, a Spanish lawyer, Gonzalez’s case is that some articles, which appeared first for the search of his name, hosted on the Internet relating to the repossession and auction of his home following attachment proceedings for the recovery of social security debts, were irrelevant to his reputation and thus not pertinent to public knowledge, since the issue had been resolved for over a decade.

The Court held in this case that:

“If it is found, following a request by the data subject... that the inclusion in the list of results displayed following a search made on the basis of his name of the links to web pages published lawfully by third parties and containing true information relating to him personally is, at this point in time, incompatible with Article 6(1)(c) to (e) of the directive because that information appears, having regard to all the circumstances of the case, to be inadequate, irrelevant or no longer relevant, or excessive in relation to the purposes of the processing at issue carried out.”

No doubt it is a path breaking decision and lead to many cases against search engines at various countries were google and yahoo become a major respondent.

In one of the leading case in Japan is the petitioner approached the court stating that his personal rights are infringed as the report of arrest in child prostitution is appearing first in search of his name even after three years of his arrest and the case is disposed of in a summary order. The court at lower level consider the crime as relatively minor and observed that there is no historic or social significance, and held that the man’s ability to rehabilitate and move on was being inhibited due to the search results connected with his name. But the High Court of Tokyo, in appeal took a different view and held that an arrest involving child prostitution is of high importance to the public and remains important even after the passage of five years. The observation made by the court is relevant today and take into consideration while the application of the erasure right¹⁹. The observation is as follows:

“the right to be forgotten is not a privilege stated in’ law and its prerequisites or effects are not determined.” Thus the right not an absolute one and should be implemented with care and caution.”

In Olivier G v. Le Soir ²⁰, a Belgium case it is ordered that the alteration of the material at source itself than the removal from the search history. The Belgian Court of Cassation ordered the anonymization of a historical news piece about a road traffic accident; it found that continued publication was a violation of the applicant’s Article 8 rights under the ECHR²¹. The applicant, a medical doctor, had been convicted of drunk driving in 1994.

Before discussing the Data Protection Bill, 2019 (herein after referred simply as the Bill) we should take a glance of the General Data Protection Regulations (herein after the regulations). Article 17²² of the Regulations provides the right to erasure. The Indian Bill have a close similarity with the Regulations, as this stand as a base model for the world in data protection legislation. One thing that to be noted is that the Regulations provides some exceptions to the Right to Forgotten.

Clause 3 of the Article 17 of the regulations provide for the exceptions of the right. The right to forgotten does not apply if data is necessary to protect the right of freedom of expression and information, compliance of legal obligation, public interest, public health, scientific or historical research purposes or statistical and for the establishment, exercise or defence of legal claims.

The Regulation paved a foundation stone to the growth of Indian law also. The Bill, now under the consideration of Joint Parliamentary Committee initially was in the same lines with the regulations but after the introduction in 2019 it faces serious lacunas.

The Personal Data Protection Bill, 2019

The Personal Data Protection Bill, 2019 is introduced as Bill No.373 of 2019, introduced in the Lok Sabha is trying to emerge as a code that satisfies the Data Protection needs in India, but there are lot of grey areas in it. Here we are not discussing the merits and details of the Act but about the right to forgotten given under the Act.

The preamble of the Bill says that the right to privacy is a fundamental right and it is necessary to protect personal data as an essential facet of informational privacy. Apart from various judicial decisions, this is the first law (if passed in Parliament) which states privacy as a fundamental right. Among other rights, the new proposed bill tries to introduce the right to erase in its section 20²³. As a data principal one have the right to restrict or prevent the continuing disclosure of his personal data by a third party platform. If the Bill become a law, data principal can approach an adjudicating officer appointed for this purpose and file an application against the continuing disclosure of data on any of the following grounds:

•   data has served the purpose

•   it no longer necessary for the purpose;

•   consent for publication is withdrawn

•   contrary to any law

A proviso attached to this section made it clear that the data principal must show that his right or interest in preventing or restricting the continued disclosure of his personal data overrides the right to freedom of speech and expression and the right to information of any other citizen. But nowhere in the Bill, how this can be done or on what criteria the weightage shall be given to the freedom of expression and freedom of information is mentioned.

Section 20(3)²⁴ make it clear that the order of the Adjudicating Officer shall be in consideration with the sensitivity, the scale of disclosure, degree of accessibility, the role of the data principal in public life, the relevance of the personal data to the public, the nature of the disclosure and of the activities of the data fiduciary etc. These conditions are vague and gave wide powers to the authority for which there are chances of abuse. Power of review was also given to the officer, if any person finds that personal data, the disclosure of which has been restricted or prevented by an order does not satisfy the conditions referred to in that sub-section, he may apply for the review of that order. Along with wide discretionary power, the officer is vested with review power also. A major lacuna is that for the purpose of review application, applicant need not have any locus standi. Any person can approach for review stating that the conditions prescribed under this section is not satisfied. Review is given along with the appeal provision to the appellate tribunal.

Another thing missing in this is the hearing of the second party. Suppose I published a defamatory statement in my Facebook page about you. As the data and the photograph along with that is yours, as a data principal you can approach the data fiduciary i.e., the Facebook for the removal of the defamatory data content. If the fiduciary is satisfied. I am the person who published the data. So I have a right to be heard before the data is removed.

World wide data is available at a person’s fingertip. Digital platforms are widening in an alarming rate. Thus Data based abuses are also increasing. Right to erase unwanted data or to delink a person’s name from unwanted data is a necessity to live in a digital era. But the same shall be handled with care and caution, without infringing the fundamental freedoms. A strict legal frame work shall be there compactable to the fast growing digitalisation. Among this the right to forgotten in the digital space have a prime importance and it should have a statutory back up for the enforcement of that right.

End note: You are compelled to forget, legally!

Foot Notes:

1.   A renowned author and a Nobel Laureate in his Of love and other Demons.

2.   Report Submitted by Justice Sreekrishna Committee on the Personal Data Protection.

3.   “No person shall be deprived of his life and personal liberty except according to procedure established by law”.

4.   1985 KLT OnLine 1238 (SC) = AIR 1986 SC 180.

5.   1981 KLT OnLine 1010 (SC) = AIR 1981 SC 746.

6    Ibid.

7.   Munn v. Illinois, 153 (1877) 94 U.S.113.

8.   Supra.

9.   2017 (4) KLT 1 (SC) = 2017 (10) SCALE 1.

10.1950 KLT OnLine 805 (SC) = AIR 1950 SC 594.

11.1960 KLT OnLine 1415 (SC) = AIR 1960 SC 554.

12.1972 KLT OnLine 1104 (SC) = AIR 1973 SC 106.

13.1975 KLT OnLine 920 (SC) = AIR 1975 SC 885.

14  1986 KLT OnLine 1433 (SC) = AIR 1986 SC 1773.

15.1988 (2) KLT OnLine 1106 (SC) = (1988) 4 SCC 592.

16.Ibid.

17.  Article 19 (1)(a).

18.   Google Spain SL, Google Inc. v. Agenda Espanola de Protection de Dates, HUM. RTS. L.REV. 5 (2014). The right to be forgotten emerged in May 2014 from the European Court of Justice’s (“EG”).

19.    Andrew Neville, Is it a Human Right to be Forgotten? Conceptualizing the World View,
15 Santa Clara J. Int’l

         L.157 (2017). Available at: https://difiitalcommons.law.scu.edU/scuiil/voll5/iss2/2

         See also Yahoo Japan Sets Out Procedure for Search Result Removal, JAPAN TIMES
(Mar. 31, 2015), available athttp://www.iapantimes.co.ip/news/2015/03/31/national/vahoo-
iapan-sets-procedure-search-resultremoval/#. Vkehla6rRE5.

20.    29 April 2016, C.15.0052.F. See also Judith (2017) Data protection and the ‘right to be forgotten’ in practice: a UK perspective. International Journal of Legal Information, 45 (1). pp. 28-33. ISSN 0731-1265.

21.    European Convention on Human Rights, 1953

22.    Right to erasure (‘right to be forgotten’)

1.      The data subject shall have the right to obtain from the controller the erasure of personal data concerning him or her without undue delay and the controller shall have the obligation to erase personal data without undue delay where one of the following grounds applies:

(a)    the personal data are no longer necessary in relation to the purposes for which they were collected or otherwise processed;

(b)    the data subject withdraws consent on which the processing is based according to point (a) of Article 6(1), or point (a) of Article 9(2), and where there is no other legal ground for the processing;

(c)    the data subject objects to the processing pursuant to Article 21(1) and there are no overriding legitimate grounds for the processing, or the data subject objects to the processing pursuant to Article 21(2);

(d)    the personal data have been unlawfully processed;

(e)    the personal data have to be erased for compliance with a legal obligation in Union or Member State law to which the controller is subject;

(f)     the personal data have been collected in relation to the offer of information society services referred to in Article 8(1).

2.      Where the controller has made the personal data public and is obliged pursuant to paragraph 1 to erase the personal data, the controller, taking account of available technology and the cost of implementation, shall take reasonable steps, including technical measures, to inform controllers which are processing the personal data that the data subject has requested the erasure by such controllers of any links to, or copy or replication of, those personal data.

3.      Paragraphs 1 and 2 shall not apply to the extent that processing is necessary:

(a)    for exercising the right of freedom of expression and information;

(b)    for compliance with a legal obligation which requires processing by Union or Member State law to which the controller is subject or for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller;

(c)    for reasons of public interest in the area of public health in accordance with points (h) and (i) of Article 9(2) as well as Article 9(3);

(d)    for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes in accordance with Article 89(1) in so far as the right referred to in paragraph 1 is likely to render impossible or seriously impair the achievement of the objectives of that processing; or

(e)          for the establishment, exercise or defence of legal claims.

23.    Section 20. (1) The data principal shall have the right to restrict or prevent the continuing disclosure of his personal data by a data fiduciary where such disclosure-

(a)    has served the purpose for which it was collected or is no longer necessary for the purpose;

(b)    was made with the consent of the data principal under section 11 and such consent has since been withdrawn; or

(c)    was made contrary to the provisions of this Act or any other law for the time being in force.

(2)    The rights under sub-section (1) may be enforced only on an order of the Adjudicating Officer made on an application filed by the data principal, in such form and manner as may be prescribed, on any of the grounds specified under clauses (a), (b) or clause (c) of that sub-section:

         Provided that no order shall be made under this sub-section unless it is shown by the data principal that his right or interest in preventing or restricting the continued disclosure of his personal data overrides the right to freedom of speech and expression and the right to information of any other citizen.

(3)    The Adjudicating Officer shall, while making an order under sub-section (2), having regard to—

(a)    the sensitivity of the personal data;

(b)    the scale of disclosure and the degree of accessibility sought to be restricted or prevented;

(c)    the role of the data principal in public life;

(d)    the relevance of the personal data to the public; and

(e)    the nature of the disclosure and of the activities of the data fiduciary, particularly whether the data fiduciary systematically facilitates access to personal data and whether the activities shall be significantly impeded if disclosures of the relevant nature were to be restricted or prevented.

(4)    Where any person finds that personal data, the disclosure of which has been restricted or prevented by an order of the Adjudicating Officer under sub-section (2), doesnot satisfy the conditions referred to in that sub-section, he may apply for the review of that order to the Adjudicating Officer in such manner as may be prescribed, and the Adjudicating Officer shall review his order.

(5)  Any person aggrieved by an order made under this section by the Adjudicating Officer may prefer an appeal to the Appellate Tribunal

24.    The Personal Data Protection Bill, 2019.

Local Investigation and Local Inspection under Civil Procedure Code

(By P.B.Menon, Advocate, Palakkad)

A reading of the recent judgment reported in 2020(4) KLT 640 prompted me to pen a few lines as shown hereunder.

In my experience at the Bar as a trial court lawyer for the last 70 years (I have completed 70 years at the Bar and is still in active practice) I have not come across a single petition for local inspection, in a civil suit, being filed under a proper provision in the C.P.C., as all such applications quote only Order 26 Rule 9 C.P.C., whereas according to me, it ought to be under Order 39 Rule 7 C.P.C. which specifically provides for local inspection and not local investigation. The two are totally different. When a party requires just the nature of condition of the property involved in the suit relating to which a suit is filed, to be noted and make a report, it is just local inspection and not local investigation. In a local inspection what the commissioner actually finds in the property visually by him/her has to be reported. No investigation is involved. But in other cases like identification or other matters as in a final decree in a partition suit etc as disclosed in Order 26 Rule 9, what is done by the commissioner is local investigation. Legally speaking are they not different.

One ruling which I have come across is reported in 1980 Orissa 98, wherein this difference is pointed out.

Substituted Performance as an Effective Specific Relief: Myth or Reality?

(By P.T. Mohan Kumar, Advocate, High Court of Kerala)

“.........men may exercise at discretion their natural rights to enter into all contractswhatsoever that are in their nature obligatory; and it is the duty and the prerogative of the judiciary alone, to decide upon the obligation of all contracts that come before them for adjudication-and legislatures have no authority to interfere in the matter, further than to prescribe the means to be used for enforcing the obligation of contracts, and the extent to which these means shall be exerted.”                                           -- (Lysander Spooner₁)

§ 1.1  Freedom of contract

Freedom of contract is always recognised in the Law of Contracts. It is the right of an individual to enter into a contract. When we use the term “contract” it can only mean an agreement enforceable by law and not otherwise. It is the prerogative of the parties to prescribe the scope of enforceability of the contract they enter into and to impose mutual rights and obligations. “Generally speaking, among the inalienable rights of the citizen is that of the liberty of contract.”₂ This is the precise nature of the doctrine of ‘freedom of contract’. The freedom of contract is curtailed by the universal rule that it shall not violate the law of the land in moral and legal terms and it shall not be against the public interest. Such a contract entered into between individuals is legally binding on them and has the force of law which the law recognises as enforceable.

§ 1.2  Freedom to pursue remedy

Freedom to pursue remedy in case of breach of contract is a necessary corollary of the ‘freedom of contract’. It is the freedom of the party who suffers breach, to pursue the legal remedy in the nature of specific performance or damages. Of course, such remedies are with reasonable restrictions. “It is necessary to recognize the importance of preserving the integrity of agreements and the fundamental rights of parties to deal, trade, bargain, and contract. On the other hand, there is concern for the uneducated and often illiterate individual who is the victim of gross inequality of bargaining power, usually the poorest members of the community”₃. Thus, the legislature and judiciary believe that there exists a duty to distinguish between contractual freedom on the one hand and legality and fairness on the other hand. Unequal bargaining power of parties or unconscionable nature of the contract often influence courts to enforce contractual obligations with utmost caution. This is in other words nothing but the discretionary power of the courts. In India, the Hon’ble Supreme Court in Central Inland Water Corporation v. Brojo Nath Ganguly & Another ₄ held that Article 14 of the Constitution guarantees to all persons equality before law and the equal protection of laws. The Apex Court made it explicitly clear that Courts will not enforce unconscionable contracts and will strike down unfair and unreasonable contracts, or unfair and unreasonable clauses in contracts, entered into between parties who are not equal in bargaining power. The above principle will apply where the inequality of bargaining power is the result of great disparity in the economic strength of the contracting parties. It was held that it will apply to situations in which the weaker party is compelled, out of pressing circumstances to enter into contracts to obtain goods or services or means of livelihood wherein unconscionable terms are imposed by the stronger party. As the weaker party is left with no choice, or rather no meaningful choice, but to give his assent to such contracts or to sign on the dotted line in a prescribed or standard form or to accept a set of rules forming part of the contract, however, unfair, unreasonable or unconscionable it may be. This principle will not apply when the bargaining power of the contracting parties is equal or almost equal. This principle may not apply where both parties are businessmen and the contract is a commercial one. In today’s complex world of giant corporations with their vast infrastructural organisations including the State through its instrumentalities and agencies entering into almost every branch of industry and commerce, there can be myriad situations which result in unfair and unreasonable bargains between parties possessing wholly disproportionate and unequal bargaining power. The Apex Court held in the above case that the courts must judge each case on its own facts and circumstances when called upon to do so by a party and may invoke the discretion contained in Section 31(1) of the Specific Relief Act, 1963, for invalidating such contracts.

§2.1 Specific Performance and Test of Inadequacy

Specific Performance is always treated as an equitable remedy, rather than a legal remedy. It is the settled common law principle that specific performance can be granted only when damages cannot be adequate. “By inadequacy of the remedy at law is here meant, not that it fails to produce the money - that is a very usual result in the use of all remedies — but that in its natureor character it is not fitted or adapted to the end in view ₅. Courts used to grant specific performance only when it was perceived that damages will be inadequate. Specific performance is deemed an extraordinary remedy, awarded at the court’s discretion. “It must be remembered that specific performance is not a matter of right, even when the plaintiffs evidence establishes a contract valid at law and sufficient for the recovery of damages. Ordering specific enforcement of a contract is a matter within the sound judicial discretion of the court... The plaintiff was required to show the good faith and equities of its own position, and the trial Chancellor, in weighing the equities, was entitled to consider whether a decree of specific performance would work an unconscionable advantage to the plaintiff or would result in injustice.“ ₆

Hitherto the traditional common-law rule that “specific performance is available only when damages are inadequate” was being followed in India also. In India, granting remedy or specific performance was purely discretionary until quite recently. Merely because it is lawful, a litigant would never get specific performance as a matter of right and always it was granted as an exception and on proving the inadequacy of damages. If the courts find that it is difficult to quantify damages, specific performance used to be decreed, subject to the satisfaction of equity and good conscience. This was the law followed in India in consonance with the Anglo-American jurisprudence, which is now being frowned upon as a controversial “contract theory” by many modern jurists.

§2.2  Substituted Performance - a substantive relief?

Substituted performance is an alternate method provided for, in a contract in order to fulfil the obligations under the contract, by the party suffering breach through a third party or through his own agency. Substituted performance is a concept recognised under the law of contracts, for mitigating damage consequent to the breach from the promisor, without the intervention of the courts and based on a “principle of self-help”.

§2.3  Statutory recognition of the concept of Substituted Performance in India

In India also the inefficacy of granting specific relief, applying the test of “inadequacy theory” is found to be rather obsolete. The Ministry of Law appointed an Expert Committee₇ to study reforms to be effected on the Specific Relief Act, 1963. Accordingly the Committee submitted a report suggesting amendment of the various sections of the Act. Among them the most notable suggestion was to take away the wide discretion of courts in granting the relief of specific performance, under Section 20. The Committee in its report, dated 26th May, 2016 observed:

“11.5.6: Even if specific performance is a routine remedy, parties would seek specific relief in the same type of cases in which it is available under the present law. This is actually also the strongest justification of relaxing the grant of specific relief. If the promisee has the choice of his remedy, he will choose compensation after obtaining substitutes. He will also ask for compensation where he expects the promisor to be reluctant or hostile, where the performance will require supervision not available from the court, or where he cannot suspend his affairs pending orders from the court. He will choose specific performance only if there is no substitute, either because the subject matter is not available, or is of special value to him, and where he is willing to wait for relief till execution of the decree. Hence there need not be any fear or increase in litigation and administrative costs”. The committee further observed:

“11.5.7: If the inadequacy test is removed, the promisee can choose his own remedy. The promisee is the best judge of his own interest, and whether substitutes satisfy his needs. He has more information than the courts whether compensation is adequate, what it would cost him to get specific performance, and whether his promisor will obey the decree. He is unlikely to sue for specific performance if he finds a substitute or where compensation will be adequate”.

The Parliament accepting the recommendations of the Expert Committee and applying legislative wisdom amended the Specific Relief Act, as per the Specific Relief (Amendment) Act, 2018.

§2.4  Section 20 of the Specific Relief Act, 1963 (amended)

The amended Section 20 of the Specific Relief Act, 1963 reads as follows :-

20. Substituted performance of contract.— (1) Without prejudice to the generality of the provisions contained in the Indian Contract Act, 1872 (9 of 1872), and, except asotherwise 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.

(2) No substituted performance of contract under sub-section (1) shall be undertaken unless the party who suffers such breach has given a notice in writing, of not less than thirty days, to the party in breach calling upon him to perform the contract within such time as specified in the notice, and on his refusal or failure to do so, he may get the same performed by a third party or by his own agency:

Provided that the party who suffers such breach shall notbe entitled to recover the expenses and costs under sub-section (1) unless he has got the contract performed through a third party or by his own agency.

(3) Where the party suffering breach of contract has got the contract performed through a third party or by his own agency after giving notice under sub-section (1), he shall not be entitled to claim relief of spec fie performance against the party in breach.

(4) Nothing in this section shall prevent the party who has suffered breach of contract from claiming compensation from the party in breach.

The Allahabad High Court observed in Mukesh Singh & Ors. v. Saurabh Chaudhary & Ors.₈ about the salient feature of the amended provision in the following words: “The discretionary jurisdiction of Courts to decree specific performance was done away by newly substituted Section 20 by Act 18 of 2018. The newly substituted Section 20 makes specific performance of contract a general rule than exception subject to certain limited grounds. The newly substituted Section provides for substituted performance of contract, where a contract is broken, the parties who suffer would be entitled to get the contract performed by a third party or by his own agency and to recover expenses and cost including compensation from the party who failed to perform his part of the contract. This provision has been provided as an alternative remedy at the option of the party who suffers the broken contract”.

§2.5  Analysis of Section 20

2.5.1. Without prejudice to generality of the Indian Contract Act”.....how to be interpreted?

It is well settled that when this expression is used, it is to indicate that anything contained in the provisions following this expression is not intended to cut down the generality of the meaning of the provisions in the statute referred to therein. This was explained by the Privy Council in King-Emperor v. Sibnath Banerji₉ and followed by the Hon’ble Supreme Court in Shiv Kirpal Singh v Shri V. V.Giri₁₀.

2.5.2. There should be breach of promise: Breach committed by the promisor gives rise to a cause of action for the promisee to invoke this remedy.

2.5.3. Except as otherwise agreed upon by the parties:

Substituted performance should be stipulated in the agreement as a contractual clause to the effect that in the event of breach, it is available as an alternate remedy to the promisee, enforceable against the promisor.

2.5.4. 30 days’ notice: The remedy can be resorted to, by the promisee only after issuing 30 days’ notice to the promisor and on the failure of the latter to respond to it or on his refusal. Issuance of notice is mandatory and an essential pre-requisite for availing of the above remedy.

2.5.5. Performance through a third party or through his own agency: The promisee can get the contract performed though a third party, at his option or by the promisee himself or through his agents.

2.5.6. Promisee entitled to recover the cost and expenses incurred for substituted performance from the promisor: The cost and expenses are the actuals and the same are not in the nature of damages.

2.5.7. Recovery of expenses and costs only if substituted performance is accomplished and not otherwise. In other words, it cannot be claimed in expectation of the expenses and costs that would incur, while availing of the above remedy.

2.5.8. No claim for specific performance allowable: Once the above remedy is availed of no further claim for specific performance of the contract.

2.5.9. The promisee is having an option to claim compensation as well: Even after availing of substituted performance, the promisee is having the right to claim compensation. It is explicit from the opening sentence of S.20 that provisions of the Indian Contract Act, 1872 will apply, even while invoking substituted performance as a specific relief. It is equally clear that the principles of S.73 of the Indian Contract Act, 1872 will apply in the matter of claiming compensation. It would be a natural corollary of the above provision that the quantum of compensation may depend on mitigative factors, natural course of events and attendant circumstances.

§3.1  Substituted Performance - a remedy is ex contractu — How far compensation is claimable?

The right emanating from the contract is ex contractu, as could be seen from Section 20 itself. Reimbursement of actual expenses and costs, that may arise while availing of the above remedy is claimable against the defaulting party. How far a claim ex delicto - arising from or based on a tort or delict (as a breach of duty) be enforced against the other contracting party, as a general rule, is rather doubtful. Substituted Performance is obviously an extra-judicial remedy. Of course, it is subject to S.41 of the Indian Contract Act which lays down a rule of accord and satisfaction in the sense that “when a promisee accepts performance of the promise from a third person, he cannot afterwards enforce it against the promisor”. But, under Section 20, compensation can still be enforced by the party suffering breach. When analysing the above two statutory provisions objectively, the following questions may arise:

1)    Would it be against the prohibition contained in Section 41 of the Indian Contract Act, 1872?

2)    Would there be any congruity or conflict likely to arise between these two statutory provisions?

3)    Is it the intention of the legislature that right to recover expenses and cost from the defaulter is only mitigatory?

4)    If so, can such amounts be set off from compensation claimed?

These questions would depend on the facts of a given case and let’s wait for judicial interpretation on the above conundrum.

§3.2  Substituted performance - in other Jurisdictions - A Comparative Analysis

§3.2.1. In United States

In the United States it is recognised as a Judicial Remedy in appropriate cases. The courts may decree that, without prejudice to other modes, the act required, as far as practicable, be done by the party by whom the order or judgment is obtained or some other person appointed by the court, at the cost of the disobedient party, and upon the act being done the expenses incurred may be ascertained in such manner as the court may direct and execution may issue against the disobedient party for the amount so ascertained and for costs₁₁. Now, the Uniform Commercial Code₁₂ provides that there can be agreement providing remedies in addition to or in substitution of those provided under law, limiting the measure of damages and can recover expenses as an option to be availed of by the party suffering breach in some contracts, viz., sale of goods, lease etc.

§3.2.2.United Kingdom

In English Law, the rigorous approach is still continuing and the archaic common law concepts have not undergone much changes substantially. With regard to the freedom of parties to stipulate the remedy before arising of dispute, the position of English law is not entirely clear₁₃. English Courts are generally reluctant to enforce ‘party agreed specific performance clauses”. Such reluctance is justified by invocation of “paternalistic concerns” and by the argument that parties cannot oust the power of courts through their private agreement₁₄. Only in convincing cases freedom of parties to agree on ‘remedial terms’ is allowed by English Courts₁₅.

§3.2.3.  Australia

A distinction between substitutionary and compensatory contractual awards is usually drawn in Australia and particularly in regard to ‘avoided loss rule of mitigation’, while considering the grant of the remedy in actions for specific performance. In Clark v Macourt₁₆ the Australian High Court, in an unusual factual circumstance that arose, by a majority awarded the buyer the full cost of replacing the defective sperm at the date of breach even though the award left her in a significantly better financial position than she would have been in, had the breach not occurred. This shows that substituted performance is recognised as an alternate form of specific relief, though not made as a statutory provision.

§3.2.4. Russia

Substitute performance has been in vogue in Russia for many years, as a specific relief and after the commencement of the Civil Code, since 1922, it became a statutory provision₁₇.

§3.2.5. France

French law recognises the duty of the promisor mis en demeure (promisee required by the promisor to comply with his duties’) to specifically perform his contractual obligations. The availability of specific performance depends on the character of the obligation that the promisee promised to perform. Substituted performance is not generally allowed as a matter of right₁₈.

63.2.6. Other Countries

German Law requires the promisor to contract for a substitute performance where the obligation to do can be performed by a third party₁₉. Even impracticability or rather inadequacy of specific performance prompted many countries like Denmark, Sweden, Italy, and China to grant relief of “substituted performance” as a substantive relief when contracts are broken. In Poland, “if a debtor is in default in performing an obligation to act, the creditor may demand authorization from the court to perform the act at the debtor’s cost, while retaining a claim for remedy of damage. In emergencies, the creditor may perform an act without the court’s authorization, at the debtor’s cost, or remove all that the debtor has done contrary to the obligation, at the debtor’s cost, while retaining a claim for remedy of damage.₂₀

§ 4.1 Unique experiment in India

Comparative study would indicate that India made a great leap forward in introducing substituted performance as a mode of specific relief. Obviously, it is for promoting the “self-help” theory of availing of legal remedies expeditiously and efficaciously and without incurring substantial litigation costs. Such litigation reforms are to be welcomed in India, especially the court fees and costs in this country are rocketing higher and higher day by day. Coupled with that, the inordinate delay in getting reliefs from courts also would justify such judicial reforms helping a litigant to seek his own legal remedies, extra judicium without spending substantial money, time and effort.

§ 4.2  Legal Implications of Substituted Performance - an analysis

Concept of Substituted performance is an antithesis of the “inadequacy test”. Please refer to the Expert Committee’s report (supra):“Ifthe promisee has the choice of his remedy, he will choose compensation after obtaining substitutes. He will choose specific performance only if there is no substitute, either because the subject matter is not available, or is of special value to him, and where he is willing to wait for relief till execution of the decree. Hence there need not be any fear or increase in litigation and administrative costs. If the inadequacy test is removed, the promisee can choose his own remedy. The promisee is the best judge of his own interest, and whether substitutes satisfy his needs. He has more information than the courts whether compensation is adequate, what it would cost him to get specific performance, and whether his promisor will obey the decree. He is unlikely to sue for specific performance if he finds a substitute or where compensation will be adequate”. Manifestly, the Parliament accepted the above proposition of the Expert Committee and the new Section 20 was introduced. Observations of the Expert Committee would serve as a tool for interpretation of the scope of the above statutory provision.

§ 4.2.1  Principle of substitutio personarum

The underlying principle is substitutio personarum (substitution of legal relationship of persons). It is more or less in the nature of an equitable assignment by a collateral contract letting a third party to perform the unfulfilled obligations. The Apex Court expressed a considered view on assignment of contracts in Kharadah Co.Ltd., v. Raymon and Co. (India)Ltd.₂₁: “The law of the subject is well settled and might be stated in simple terms. An assignment of a contract might result by transfer either of the rights or of the obligations thereunder. But there is a well-recognised distinction between these two classes of assignments. As a rule obligations under a contract cannot be assigned except with the consent of the promisee, and when such consent is given, it is really a novation resulting in substitution of liabilities. On the other hand rights under a contract are assignable unless the contract is personal in its nature the rights are incapable of assignment either under the law or under an agreement between the parties”. The Hon’ble Supreme Court relied on, the principle in The British Waggon Company v. Lea & Co₂₂. In British Waggon Company’s case it was laid down as follows: “Where a person contracts with another to do work or perform service, and it can be inferred that the person employed has been selected with reference to his individual skill, competency, or other personal qualification, the inability or unwillingness of the party so employed to execute the work or perform the service is a sufficient answer to any demand by a stranger to the original contract of the performance of it by the other party, and entitles the latter to treat the contract as at an end, notwithstanding that the person tendered to take the place of the contracting party may be equally well qualified to do the service”.

§ 4.2.2. Contracts on Personal Confidence - not assignable

Thus it is clear that performance of the obligation arising out of contracts solely based on personal confidence or the exercise of individual skill is normally not assignable.
A contract is unassignable where it is based upon an element of personal skill or personal confidence to which, for the purposes of the contract, a stranger or third party cannot make any pretensions. This principle is further explained in Copper v. Micklefield Coal and Lime Co₂₃. Therefore, the law is abundantly clear that for personal contracts of service, no substituted performance is possible.

§ 4.3  Doctrine of Privity vis-a-vis Collateral Contracts

Doctrine of Privity of contract implies that no one except the parties to contract are entitled or be bound by it. This doctrine has its exceptions, like collateral contracts as indicated above. A collateral contract is a contract between the third party and one of the parties to the main contract which associates with the main contract and such contract enables the third party to enforce the main contract. A contract between two parties may be accompanied by a collateral contract between one of them and a third person relating to the same subject-matter. This constitutes an equitable assignment. Such assignments are valid and the assignee gets right to enforce the right assigned. (Darlington Borough Council v Wiltshire Northern Ltd.).₂₄ The performance of an obligation under a contract can also be validly assigned. The promise of a third party to perform contractual obligation is also a valid consideration under S.2(d) of the Indian Contract Act, 1872.

§ 4.4  Substituted performance - assignment or novation of Contract involved?

“As a rule obligations under a contract cannot be assigned except with the consent of the promisee, and when such consent is given, it is really a novation resulting in a substitution of liabilities” (British Wagon Co. v. Lea & Co).₂₅  The Supreme Court has observed that, as a rule, obligations under a contract cannot be assigned except with the consent of the promisee. (Kharadah Co.Ltd. v. Ramon and Co. Pvt. Ltd.₂₆). As per the Transfer of Property Act, 1882, assignment of contractual rights or benefits has been couched under the term ‘actionable claim’ and is dealt with extensively under Section 130 of the Act. For assignment Notice S.131 is necessary. In Kharadah Co. Ltd. v. Raymon & Co (India) Private Ltd. (supra),the Apex Court has laid out the principle as follows: An assignment of a contract might result by transfer either of the rights or of the obligations thereunder. But there is a well-recognized distinction between these two classes of assignments. As a rule obligations under a contract cannot be assigned except with the consent of the promisee, and when such consent is given, it is really a novation resulting in substitution of liabilities. On the other hand, rights under a contract are assignable unless the contract is personal in its nature or the rights are incapable of assignment either under the law or under an agreement between the parties. The Apex Court reiterated the above principle in a recent ruling in Kapilaben & Ors. v. Ashok Kumar Jayantilal Sheth & Ors.₂₇

§ 4.4.1  Performance - an obligation, capable of assignment with consent.

With the above principles in mind if Section 20 is analysed, it can be seen that the legislative intention is that the duties, liabilities or burden, as a rule are transferable with the consent of the other contracting party. An exception to the rule of privity is carved out in Section 20 of the Specific Relief Act, 1963, by using the expression “.......except asotherwise agreed upon by the parties......”, indicating that an agreed stipulation is essential in the contract for availing of this benefit, obviously by way of equitable assignment, which the other contracting party agrees at the very inception of forming the contract.

§ 4.5  Substituted Performance - an extrajudicial remedy?

If the promisee suffering breach issues 30 days’ notice to the promisor, signifying his intention to invoke this remedy and there is failure or refusal from the side of the other party, performance can be sought for, from a third party or on his own agency. The party suffering breach need not approach a court to get the relief of substituted performance. Intervention of the court is necessitated only for recovery of the amount due and payable by the defaulter.

§ 4.6  After substituted performance, to what extent jural relationship of parties changes?

After getting substituted performance, the jural relationship of the contracting parties is modified as that of a debtor and creditor. The defaulter becomes a debtor and the party suffering breach becomes the creditor, in as much as there remains only an enforceable money claim towards reimbursement of the expenses and costs, in the nature of an actionable claim.

§ 4.7  Effect of Section 20 on contracts for sale of immoveable property

Section 55(6)(b) of the Transfer of Property Act, 1882 enables a buyer to enforce a lien on the property agreed to be purchased, subject to the conditions laid down therein.

Section 55(b): Unless he has improperly declined to accept delivery of the property,to a charge on the property, against the seller and all persons claiming under him, to the extent of the seller’s interest in the property, for the amount of any purchase-money properly paid by the buyer in anticipation of the delivery and for interest on such amount; and, when he properly declines to accept the delivery, also for the earnest (if any) and for the costs (if any) awarded to him of a suit to compel specific performance of the contract or to obtain a decree for its rescission. An omission to make such disclosures as are mentioned in this section, paragraph (1), clause (a), and paragraph (5), clause (a), is fraudulent.

The effect of Section 20 may interfere with the exercise of statutory lien/charge over the property forming the subject matter of the contract, by the buyer who is alleged to have defaulted in complying with his contractual obligations. The moment a notice as contemplated under the above provision, is issued by the seller, alleging default against the buyer and signifying his intention to invoke substituted performance, the law is set in motion. If the buyer fails to comply with the requirements made of, in the notice or does not respond, the seller gets an option to sell the property to a third party. Will the buyer lose his statutory lien? If the legislative intention is given effect to, in its letter and spirit, the answer is in the affirmative. Of course, it may be a question of fact to be proved in a given case. If the alleged defaulter proves that he never defaulted his part of the contract alleging breach of a reciprocal promise by the seller and a court is called upon to decide upon a question of fact as to who has committed breach, the sustainability of substituted performance depends on a judicial decision. Cases may arise, wherein the sufficiency and adequacy of notice is challenged. In such cases, questions may arise as to sustainability of substituted performance, even though it is already availed of by the seller, and whether a defective notice may go to the root of the matter to invalidate the remedy exercised, would be mooted with force. But, once substituted performance is accomplished and a third party acquires right over the subject matter and court finds default on the part of the seller, the remedy of the buyer lies on in damages only. Would Section 53 of the Transfer of Property Act, 1882 also apply, if a fraudulent element is proved, is also another question. Would a third party who rightfully undertook the obligation of substituted performance be protected is yet another question.

§ 4.8  Effect of Section 20 on contracts for sale of goods.

Conflict would also arise, if the buyer opts in substituted performance under the followingcircumstances, especially in cases to which the Sale of Goods Act, 1930 applies. Instances where conflict would arise are (i) if the goods are unique or (ii) if the goods obtainable under the substituted performance, are of a different quality or price apart from that specified in the contract. The obligation under the main contract must be assigned by way of a clause of collateral contract with a third party without “novation, alteration or modification” - that would be the legislative intent though not explicit in Section 20. If the substitute goods are of high value and of a different quality, the same would never be accepted as substituted performance, unless the other contracting party agrees. The Australian precedent in Clark v. Macourt (supra) is a unique case, where the court accepted substituted performance with variation of the original contract. How far that principle can be imported into the India law is debatable.

§ 4.9  Promptness, earnestness and timely action - a pre-requisite.

“Specific performance is a relief which this Court will not give, unless in cases where the parties seeking it come promptly, and as soon as the nature of the case will permit. (Per Lord Cranworth, Eads v. Williams)₂₈. This is a principle of equity, which the Indian courts also follow zealously. If the party suffering breach invokes the remedy of substituted performance without delay, he can get the remedy and avail of the benefit of Section 20.

§ 4.9.1  Law favours the vigilant

The principle covered by the Latin maxim that vigilantibus, non dormientibus, jura subveniunt (the laws give help to those who are watchful and not to those who sleep) would certainly apply with much force in a case, where a defaulter fails to respond to a notice issued by the party suffering breach, prior to invoking the substituted performance clause. Laches, which form the basis of in the above maxim was examined by the Hon’ble Supreme Court, in Bharat Barrel & Drum Mfg.Co.Ltd. & Anr. v. Employees State Insurance Corporation₂₉. Further in State Of M.P. & Anr. v. Pradeep Kumar & Anr.₃₀, the Apex Court observed: “...but even a vigilant litigant is prone to commit mistakes. As the aphorism to err is human is more a practical notion of human behaviour than an abstract philosophy, the unintentional lapse on the part of a litigant should not normally cause the doors of the judicature permanently closed before him. The effort of the court should not be one of finding means to pull down the shutters of adjudicatory jurisdiction before a party who seeks justice, on account of any mistake committed by him, but to see whether it is possible to entertain his grievance fit is genuine”. Also cases would arise, wherein both parties are at fault by committing breach of reciprocal promises. If both parties are at fault, the maxim in pari delicto would apply. But, this maxim is not of much universal application as explained by the Apex Court in Mohd. Salimuddin v. Misri Lal & Anr.₃₁, in the following words:” The doctrine of pari-delicto is not designed to reward the ‘wrong-doer’, or to penalize the ‘wronged’, by denying to the victim of exploitation access to justice. The doctrine is attracted only when none of the parties is a victim of such exploitation and both parties have voluntarily and by their free will joined hands to flout the law for their mutual gain. Thus, it is obvious that judicial review of substituted performance would be done based on the sound principles of law, even if the remedy of substituted performance is already obtained by a litigant.

§ 5.1  Conclusion

“Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest in his own way, and to bring both his industry and capital into competition with those of any other man, or order of men₃₂.” These words of Adam Smith are golden. It is not the rigorous letters of law that justify a remedy. It must stand the test of the “laws of justice”, which is nothing but a codification of equity and good conscience. Even if the power of discretion is taken away from courts, by the amendment to Specific Relief Act, 1963, it may not be having the effect of stripping of such a power from courts, especially when discretion is not taken away from courts in exercising the power under Section 31(1) of the Specific Relief Act, 1963. The Apex Court in Central Inland Water Corporation v. Brojo Nath Ganguly & Anr. (supra)held that the courts must judge each case on its own facts and circumstances when called upon to do so by a party and may invoke the discretion contained in Section 31(1) of the Specific Relief Act, 1963, for invalidating contracts, which are shown to be unconscionable and executed between parties not having equal bargaining power. Discretionary power is inherent in every court, as a necessary corollary for rendering justice in accordance with law, to do what is “right’ and undo what is “wrong’, that is, to do all things necessary to secure the ends of justice and prevent abuse of its process. Accepting this principle, in Vinod Seth v. Devinder Bajaj₃₃ the Apex Court also observed that “Courts will do well to keep in mind the warning given by Benjamin N. Cardozo in The Nature of the Judicial Process₃₄ : “The Judge even when he is free, is still not wholly free. He is not to innovate at pleasure. He is not a knight-errant roaming at will in pursuit of his own ideal of beauty or of goodness. He is to draw his inspiration from consecrated principles. He is not to yield to spasmodic sentiment, to vague and unregulated benevolence. He is to exercise a discretion informed by tradition, methodized by analogy, disciplined by system, and subordinated to “the primordial necessity of order in social life”.

Foot Notes

1. The Unconstitutionality of Slavery - Lysander Spooner.

2. Frisbie v. United States, 157 U.S.160 (1895), per David Brewer, J.

3. Jones v. Star Credit Corporation 298 N.Y.S.2d 264, 265 (NY.Sup.Ct.1969).

4.   AIR 1986 SC 1571.

5.   Thompson v. Allen County (1885) 115 U.S 550, 6 Sup.Ct.140, 29 L Ed.472.

6.   Public Water Supply Dist. v. Fowlkes, 407 S W.2d 642, 647 (Mo.App.1966).

7.  Government of India, Ministry of Law & Justice, Legislative Department (Legislative III Section) (F.No.11 (2)/2015-Leg.III] vide Office Order dated 28th January, 2016.

8.   MANU/UP/1893/2019.

9.   AIR 1945 PC 156.

10.AIR 1970 SC 2097.

11.  Kronman, Specific Performance, 45, U. CHI. L.REV. 351(1978).

12.  U.C.C. - ARTICLE 2 - SALES (2002).

13.  [Lawrence Collins et al. (eds), Dicey, Morris, Collins: The Conflict of Laws (13th Edn., Sweet & Maxwell 2006), 1st Vol. 576].

14.  [Anthony Ogus, English Report on Remedies’, in Donald Harris and Denis Tallon (eds), Contract Law Today: Anglo-French Comparisons (OUP1989) 247)].

15.  Solene Rowan, ‘For the Recognition of Remedial Terms Agreed Inter Partes’ (2010) 126 LQR 448.

16. (2013) HCA 56- KWM.

17. Russian Commercial Law; Second Edition By Hiroshi Oda, 2007.

18. Comparative Reflections on the French Law of Remedies for Breach of Contract’, in Cohen and McKendrick (eds.), Comparative Remedies for Breach of Contract (n 18) 113

19. § 887 of the Civil Procedure Code - Germany.

20. Article  480, Polish Civil Code.

21.  AIR 1962 SC1810.

22.  (1880) 5 Q.B.D. 149.

23.  (1912) 107 L.T.457.

24.   [1995] 1 WLR 68, 79.

25.  (1880) 1 QBD 149.

26.  [1963) 3 SCR 183: AIR 1962 SC1810].

27.  2019 (16) SCALE 723 : 2019 (10) SCJ 269.

28.  (1854), 4D.M. & G.691.

29.  AIR 1972 SC1935.

30.  (2000) 7 SCC 372.

31. AIR 1986 SC1019.

32. Adam Smith - An Inquiry into the Nature and Causes of the Wealth of Nations.

33. 2010 (3) KLT SN 45 (C.No.52) SC = (2010) 8 SCC 1.

34. Yale University Press -1921 Edition Page 114.

The Doctrine of Merger and Its Effects

(By Abraham Vakkanal, Senior Advocate & Vineetha Susan Thomas, Advocate)

1. Can a review petition or a petition for incidental relief be filed in a case, where judgment pronounced, after having invoked the jurisdiction of SLP, appeal or revision against it? The answer is that in cases where an appeal or revision is provided against an order passed by a Court or Tribunal or any other authority before a superior forum and such superior forum modifies, reverses or affirms the decision put in issue before it, you can file a Review Petition or a petition for incidental relief, if so warranted, before the subordinate forum, only if the decision by the subordinate forum has not merged in the decision of the superior forum.

2. So, it is of interest to ponder on what is a “merger” and its effect in legal parlance.

3. An earlier authoritative pronouncement of our Supreme Court on this point is inShankar Ramachandra Abbhyankar v. Krishnaji Dattatraya Bapat(1969 KLT OnLine 1036 (SC). In this case, the Hon’ble Apex Court has emphasized three pre-conditions attracting applicability of doctrine of merger. They are:

i)   The jurisdiction exercised should be appellate or revisional jurisdiction,

ii)  The jurisdiction should have been exercised after the issue of notice, and

iii)   After a full hearing in the presence of both the parties.

     Then the appellate or revisional order would replace the judgement of the lower court and constitute the only final judgement.

4. This was cited in later decisions, with approval, i.e., in (i) Kunhayammed & Ors.v. State of Kerala & Anr.(2000 (3) KLT 354 (SC) and (ii)MRF Ltd. v. Manohar Parrikar and Ors.(2010 (2) KLT Suppl.112 (SC).

5. InKunhayammed, inter alia,the effect of Shankar Ramachandra Abbhyankarhas been considered as follows in para 28:

“28. Incidentally we may notice two other decisions of this Court which though not directly in point, the law laid down wherein would be of some assistance to us. In Shankar Ramchandra Abhyankar v. Krishnaji Dattatraya Bapat (AIR 1970 SC 1), this Court vide para 7 has emphasized three pre conditions attracting applicability of doctrine of merger. They are: i) the jurisdiction exercised should be appellate or revisional jurisdiction; ii) the jurisdiction should have been exercised after issue of notice; and, iii) after a full hearing in presence of both the parties. Then the appellate or revisional order would replace the judgement of the lower court and constitute the only final judgement. xxx xxxx

                            xxx                                xxx                        xx

The distinction is clear. Entertaining an application for review does not vacate the decree sought to be reviewed.

                             xxx                                xxx                        xx

The principle or logic flowing from the above-said decisions can usefully be utilised for resolving the issue at hand. Mere pendency of an application seeking leave to appeal does not put in jeopardy the finality of the decree or order sought to be subjected to exercise of appellate jurisdiction by the Supreme Court. It is only if the application is allowed and leave to appeal granted then the finality of the decree or order under challenge is jeopardised, as the pendency of appeal reopens the issues decided and this court is then scrutinizing the correctness of the decision in exercise of its appellate jurisdiction.”(emphasis supplied)

6. In Kunhayammed, the Hon’ble Supreme Court has stated,inter alia, as follows:

- Where an appeal or revision is provided against an order passed by a court, tribunal or any other authority before superior forum and such superior forum modifies, reverses or affirms the decision put in issue before it, the decision by the subordinate forum merges in the decision by the superior forum and it is the latter which subsists, remains operative and is capable of enforcement in the eye of law.

- The jurisdiction conferred by Article 136 of the Constitution is divisible into two stages. First stage is upto the disposal of prayer for special leave to file an appeal. The second stage commences if and when the leave to appeal is granted and Special Leave Petition is converted into an appeal.   (emphasis added)

7. The Supreme Court has also cautioned that the doctrine of merger is not a doctrine of universal or unlimited application. It is ruled in Kunhayammed as follows:

- Doctrine of merger is not a doctrine of universal or unlimited application.It will depend on the nature of jurisdiction exercised by the superior forum and the content or subject-matter of challenge laid or capable of being laid shall be determinative of the applicability of merger. The superior jurisdiction should be capable of reversing, modifying or affirming the order put in issue before it. Under Article 136 of the Constitution the Supreme Court may reverse, modify or affirm the judgement-decree or order appealed againstwhile exercising its appellate jurisdiction and not while exercising the discretionary jurisdiction disposing of petition for special leave to appeal. The doctrine of merger can therefore be applied to the former and not to the latter. (stress supplied)

8. The effect of speaking or non-speaking order while dismissing an SLP or appeal or revision vis-à-visthe doctrine of merger has also been explained in Kunhayammedas follows:

- An order refusing special leave to appeal may be a non- speaking order or a speaking one. In either case it does not attract the doctrine of merger. An order refusing special leave to appeal does not stand substituted in place of the order under challenge. All that it means is that the Court was not inclined to exercise its discretion so as to allow the appeal being filed.

- If the order refusing leave to appeal is a speaking order, i.e., gives reasons for refusing the grant of leave, then the order has two implications. Firstly, the statement of law contained in the order is a declaration of law by the Supreme Court within the meaning of Article 141 of the Constitution. Secondly, other than the declaration of law, whatever is stated in the order are the findings recorded by the Supreme Court which would bind the parties thereto and also the court, tribunal or authority in any proceedings subsequent thereto by way of judicial discipline, the Supreme Court being the Apex Court of the country. But, this does not amount to saying that the order of the court, tribunal or authority below has stood merged in the order of the Supreme Court rejecting special leave petition or that the order of the Supreme Court is the only order binding as res judicata in subsequent proceedings between the parties.                                                             (emphasis given)

9. It has also been made clear by the Hon’ble Supreme Court that once the leave to appeal has been granted, thereby converting it as an appeal, then the order passed in this appeal would attract the doctrine of merger and then a review petition before the High Court would not be maintained. It is stated in Kunhayammed:

- Once leave to appeal has been granted and appellate jurisdiction of Supreme Court has been invoked the order passed in appeal would attract the doctrine of merger; the order may be of reversal, modification or merely affirmation.

- On an appeal having been preferred or a petition seeking leave to appeal having been converted into an appeal before Supreme Court the jurisdiction of High Court to entertain a review petition is lost thereafter as provided by sub-rule (1) of Rule 1 of Order 47
of the C.P.C.  (emphasis supplied)

10. As far as the Writ Jurisdiction of the High Court is concerned, as we all know, there is no practice of filing SLP before invoking the Appellate Jurisdiction against the judgement of the Single Judge. If a Writ Appeal is filed, it will be posted for admission to decide on its admissibility. And if admitted, and if the respondents take notice or if the respondents appear based on the notice issued, the same will be heard and decided on merits, after hearing the respondents also. The jurisdiction under Art.136, as observed in Kunhayammmed, has two stages: (i) up to the disposal of prayer for special leave to file appeal and (ii) 2^nd stage commences if and when the leave to appeal is granted and thereby converting SLP into an appeal. Applying the same principle, it can safely be said that when you file a Writ Appeal, there are two stages: (i) upto the stage of granting admission i.e., taking decision whether it is to be admitted or not and (ii) second stage commences if and when the appeal is admitted and notice taken by respondents or issued to respondents. Therefore, the crux of Kunhayammmed is that the merger will apply only if the conditions mentioned in the 2^nd stage are met and the same applies in the case of a Writ Appeal too.

11. As stated above, the principles enunciated in Shankar Ramachandra Abbhyankar, (1969 KLT OnLine 1036 (SC)  have also been quoted with approval inMRF Ltdv. Manohar Parrikar and Ors.(2010 (2) KLT Suppl.112 (SC).

12. In MRF Ltd, it has been clearly held that the judgement of the lower court will replace the judgement of Appellate Forum, only if such judgement of the superior court is pronounced after issue of notice and a full hearing in the presence of both parties.

13. In para 38 of the judgement, it has been held:

“38. In our view, the principle of merger essentially refers to the merging of the orders passed by the superior courts with that of the orders passed by a subordinate court. This Court in the case of Shankar Ramachandra Abhyankar v. Krishnaji Dattatreya Bapat (1969 KLT OnLine 1036 (SC))has laid down the condition as to when there can be a merger of the orders of the superior court with that of the orders passed by the lower court. This Court stated, that, if any judgement pronounced by the superior court in the exercise of its appellate or revisional jurisdiction after issue of a notice and a full hearing in the presence of both the parties, then it would replace the judgement of the lower court. Thus, constituting the judgement of the superior court the only final judgement to be executed in accordance with law by the Court below. The merger is essentially of the operative part of the order and the principle of merger of the order of the subordinate Court with the order of the superior Court cannot be applied when there is no order made by the superior Court on merits and the controversy between the parties has not been looked into by the superior Court.”

14. Kunhayammedwherein other decisions were also quoted, has recently been upheld as the correct law inKhoday Distilleries ltd & others v. Sri.Mahadeshwara Sahakara Sakkare Karkhane Ltd. represented by its Liquidator(2019 (1) KLT OnLine 3301 (SC). Here, the Apex Court, applying the principles in Kunhayammed, held that since special leave petition was dismissed in limine, the review petition filed by the appellant in the High Court would be maintainableand should have been decided on merits.

15. The concluding paragraph (para 28) in Khoday Distilleries reads as follows:

“28) Applying the aforesaid principles, the outcome of these appeals would be as under:

Civil Appeal arising out of Special Leave Petition (Civil) No. 490 of 2012: In the instant case, since special leave petition was dismissed in limine without giving any reasons, the review petition filed by the appellant in the High Court would be maintainable and should have been decided on merits. Order dated November 12, 2008 passed by the High Court is accordingly set aside and matter is remanded back to the High Court for deciding the review petition on merits. Civil Appeal disposed of accordingly. Civil Appeal arising out of Special Leave Petition (Civil) No. 13792 of 2013: In this case, we find that the special leave petition was dismissed with the following order passed on January 05, 2012:

“We find no ground to interfere with the impugned order. The special leave petition is dismissed.” Here also, special leave petition was dismissed in limine and without any speaking order. After the dismissal of the special leave petition, the respondent in this appeal had approached the High Court with review petition. Said review petition is allowed by passing order dated December 12, 2012 on the ground of suppression of material facts by the appellant herein and commission of fraud on the Court. Such a review petition was maintainable. Therefore, the High Court was empowered to entertain the same on merits. Insofar as appeal of the appellant challenging the order dated December 12, 2012 on merits is concerned, the matter shall be placed before the regular Board to decide the same.”  (emphasis supplied)

16.‘Khoday Distilleries’and ‘Kunhyammed’were also followed in P. Singaravelan & Ors.v. District Collector, Tiruppur & Ors.(2019 (4) KLT OnLine 3118 (SC).

17. In Shanthi v. T.D.Vishwanathan & Anr.((2019) 11 SCC 419) it has been held recently,
in para 7 as follows :

“………………….When an appeal is prescribed under a statute and the appellate forum is invoked and entertained, for all intents and purposes, the suit continues. When a higher forum entertains an appeal and passes an order on merit, the doctrine of merger would apply. The doctrine of merger is based on the principles of the propriety in the hierarchy of the justice delivery system. The doctrine of merger does not make a distinction between an order of reversal, modification or an order of confirmation passed by the appellate authority. The said doctrine postulates that there cannot be more than one operative decree governing the same subject matter at a given point of time.”

What is emphasized here is that when a higher forum entertains an appeal and passes an order on merit, the doctrine of merger would apply.

18. The word “entertain” has been explained in the Law Dictionary as “admit a thing for consideration” and when a suit or proceedings is not thrown about in limine, but the court receives it for consideration and disposal, according to law, it must be regarded as entertaining the suit or proceedings, no matter what the “ultimate decision might be”. So, it is clear thatonly if the W A is admitted and a full hearing is given after issuing notice to the respondents, will the question of “merger” arise whatever be the final result.

19. Hence, it can safely be concluded that the doctrine of merger will apply (by which a party can be disabled from approaching the subordinate forum for filing review petition or for any other relief), if and only if, the decision by the higher forum was taken after admitting the appeal/revision, issuing notice to respondents, and after full hearing in their presence.