Code: Section 21 Specific Relief Act
21. Power to award compensation in certain cases
(1) In a suit for specific performance of a contract, the plaintiff may also claim compensation for its breach, in addition to such performance.
(2) If, in any such suit, the court decides that specific performance ought not to be granted, but that there is a contract between the parties which has been broken by the defendant, and that the plaintiff is entitled to compensation for that breach, it shall award him such compensation accordingly.
(3) If, in any such suit, the court decides that specific performance ought to be granted, but that it is not sufficient to satisfy the justice of the case, and that some compensation for breach of the contract should also be made to the plaintiff, it shall award him such compensation accordingly.
(4) In determining the amount of any compensation awarded under this section, the court shall be guided by the principles specified in Section 73 of the Indian Contract Act, 1872.
(5) No compensation shall be awarded under this section unless the plaintiff has claimed such compensation in his plaint. Provided that where the plaintiff has not claimed any such compensation in the plaint, the court shall, at any stage of the proceeding, allow him to amend the plaint on such terms as may be just, for including a claim for such compensation.
Explanation: The fact that the contract has become incapable of specific performance does not prevent the court from exercising the jurisdiction conferred by this section.
Explanation of Section 21 Specific Relief Act
Section 21 of the Specific Relief Act empowers the court to grant compensation in addition to, or in place of, specific performance when there is a breach of contract. This provision ensures that a plaintiff is compensated fairly if a contract is not performed as agreed.
Key Provisions:
- Claim for Compensation: The plaintiff can seek compensation for a contract breach alongside seeking specific performance.
- Awarding Compensation When Specific Performance is Denied: If specific performance is not granted but a breach of contract is found, the court must award compensation to the plaintiff.
- Awarding Compensation When Specific Performance is Insufficient: Even if specific performance is granted, the court may award compensation if it is not sufficient to make the plaintiff whole.
- Guidelines for Compensation: Compensation is determined based on the principles outlined in Section 73 of the Indian Contract Act, 1872, which provides for compensation for loss or damage arising from a breach of contract.
- Claim for Compensation Must Be Made in the Plaint: The plaintiff must explicitly claim compensation in the plaint. However, if they have not, the court may allow an amendment to include such a claim.
Illustration
Example 1: Claiming Compensation Alongside Specific Performance
A buyer files a suit for the specific performance of a contract for the sale of land. In addition to seeking performance, the buyer also claims compensation for the delay caused by the seller’s failure to deliver the land on time. The court may award both specific performance and compensation for the breach.
Example 2: Awarding Compensation When Specific Performance is Denied
A party enters into a contract to supply materials but fails to do so. The buyer sues for specific performance but the court finds that specific performance is not feasible. However, the court acknowledges that there is a valid contract and awards compensation to the buyer for the breach.
Example 3: Compensation When Specific Performance is Insufficient
A seller agrees to deliver goods to the buyer, but due to unavoidable circumstances, the seller can only partially fulfill the contract. The court orders specific performance but also awards compensation to the buyer for the remaining undelivered goods.
Common Questions and Answers on Section 21 Specific Relief Act
1. Can I claim compensation if I’m suing for specific performance?
- Answer: Yes, under Section 21, you can claim compensation in addition to specific performance if the contract was breached.
2. What happens if specific performance is not granted by the court?
- Answer: If specific performance is not granted, but the court finds a valid contract, the court will award compensation for the breach.
3. Can I receive compensation even if the contract is impossible to perform?
- Answer: Yes, Section 21 allows the court to grant compensation even if the contract is not specifically enforceable.
4. How is compensation calculated?
- Answer: Compensation is calculated according to the principles laid out in Section 73 of the Indian Contract Act, 1872, which considers the loss or damage caused by the breach.
5. Can I amend my claim to include compensation if I missed it in the original plaint?
- Answer: Yes, the court allows you to amend the plaint at any stage of the proceedings to include a claim for compensation, provided it is just to do so.
Conclusion
Section 21 of the Specific Relief Act ensures that plaintiffs are fairly compensated for a breach of contract, whether or not specific performance is granted. By providing the opportunity to claim both performance and compensation, this section balances the interests of both parties and ensures that justice is served. If you find yourself in a situation involving a contract breach, this section offers a legal avenue to seek both remedy and compensation.
