EQUITY CHAPTER 1

CONCEPT AND DEFINITION OF EOUITY

Introduction-Equity is not a word that can be said to have a precise meaning. The original idea of it, is
synonymous with fairness and justice. Equity is the means whereby the law and its administration are
made to approximate as closely as possible to the ideal of justice. There have been three manifestations
of it. Firstly, there is justice and reasonable interpretation of the law. Secondly, there is the need to
temper the law in its application lo the individual case. A characteristic of law, save in the rarest cases, is
the generality, and yet this may produce in the special case a result which conflicts with man's ideas of
justice which law should endeavour to fulfil Thirdly, there is the need to supplement the shortcomings
of the law. No system of law, early systems in particular, can boast of being able to provide for all
possible situations. Gaps in the law often result in the gravest injustice. Now•a-days one seeks a remedy
in legislation, but it must be remembered that legislation is a comparatively modern instrument of leyal
development. In earlier times it was resorted to very sparingly, and accordingly some other method had
to be found for filling in these gaps. Doctrines so created may bei described as "equitable" in the sense
that they fill in these unjust lacunae Equity, in the classic words of Maine, is "any body of rules existing
by the side of the original civil law, founded on, distinct principles and claiming incidentally to supersede
the civil law by virtue of a superior sanctity inherent in those principles"

The term, equity is used in three different senses. In the first sense, it means morality, honesty and
uprightness. In the second sense, equity refers to the principles of natural justice, which tempts the
fixed rules of law, In the third sense, equity consists of a set of fixed rules. It is well-tormulated set of
rules.

The term "equity" may, however, also be used in a different and more restricted sense. An equitable
decision may be one that is neither based on an existing rule of law nor designed to inaigurate a new
sequence of precedents. Is sole aim may be to do justice to the parties in a case characterized by a
configuration of facts unlikely ever to be repeated in reality in the same or similar way.

In England equity developed distinctly and separately from the comnon law. It had its separate
jurisdiction and was administered by the Chancellor and he was guided by the principles of natural
justice. The governing principle of the early iurisdiction was conscience.

In India there never had been any separate equty court but a number of principles of equity and justice
have been imcorporated in the substantive law of the land.
Sir Henry Maine while interpreting Equity'. has observed, "In progressive societies social necessities and
social opinions are always more or less, in advance of law. The gulf that is thus created between the
social opinions and the existing law is bridged up by three instrumentalities, namely (i Legal Fiction,
(iEquity, and i Legislation. When Law becomes fixed, legal fictions liberalise it, when Ie gal fictions also
become outdated, Equity softens the rigours of law, till finally a point is reached when expansion of
Equity ceases

The term, "Equity' is a derivation from the Roman term 'acquitas' which means equalization or levelling.
Etymologically, therefore, equity is that which levels down any arbitrary preferences or denial of justice.
The term, Equity' is used in various senses, out of many the four main senses in which the term is used
are:

1. Literal sense:

2. General sense;

3. Roman sense, and

4. English sense.

We have to deal only with that 'equity' which was evolved and• developed in England but for the proper
understanding of the subject it would bei better to explain the term in all the senses,

(1) Literal sense.—The literal meaning given to Equity is "right" as founded on the laws of the 'nature',
"fairness' and justice. This is also the most popular notion about this expression.

2j General sense.—In the most general sense, we call that Equity which in human transactions is
founded on 'natural justice', 'honesty' and "right'. In this sense it means that one should do to all men as
he expects to be done to him. In this way, unkindness and ingratitude or other moral wrongs clearly fall
outsidei the scope of equity.

(3) Roman sense.—‘Equity' In the Roman sense means a body of moral principles introduced in the
Roman law by Praetor which constituted Equity acquitas) by the side of "Jus Ciuile'. Ancient Civil Law of
Rome was a system of extreme rigidity and adherence to technicalities illadapted. Praetor softened the
rigour of law. He was Supreme Judicial Magistrate of Roman Republic. He altered the law by modifying
the terms of formula. Maine therefore, says that "Equity means any body of rules existing side by side
thei riginal civil law, founded on distinct principles and claiming incidentally, to supersede the civil law
by virtue of superior sanctity in those principles'. In Rome equity played a great part in the easy
development of Roman Law.

It would be better if this observation of Maine is explained with reference to Roman Jegal system. In the
earliest period of Roman Law the Praetor wasi the Supreme Judicial Magistrate of Roman Republic. Each
"Praetor' on entering upon his judicial functions set out a list. of the rights and remedies which he would
recognize during his tenure of office and gave public notice of the modes in which he intended to give
relief against the rigidity of the established system. Whenever an application of the old "Jus Civile"
would do a moral wrong and produce aresult inequitable, the Praetor's conforming his decision to the
'law of nature' provided a remedy by means of an appropriate action of defence. Gradually the case as
well as the. modes in which the Praetor' thus interfered, became more and more common and thus a
body of moral principles was intrpduced in the Roman Law which constituted Equity (Acquias) by the
side of Civil Law (Jus Civile").

(4) English sense—‘Equity' in English sense means the body of rules

formulated and administered by the Court of Chancery to supplement the rules and procedure of the
Common Law. As a part of the English systerm of Jurisprudence, however, its proper understanding
requires a brief reference to history

Historical Background.-By the middle of the 13th Century the law administered in England, was in part
Customary Law and in part Statutory Law. On account of the narrowness, extreme rigidity and formalism
of the Common Law, it often gave either inadequate remedy or no rermedy at all. The law did not
provide relief for all inconveniences. No provisions were made for matters of natural justice. In such
cases a petition was made to the king-in Council to exercise his extraordinary judicial powers. A custom
developed of referring these petitions that the 'Chancellor, who was the Chief of the King's Secretaries.
It was in dealing with these petitions that the 'Chancellor began his judicial functions and the 'Court of
Chancery' was established besides the Court of Common Law. The Chancellor' acted according to hisi
judicial conscience or the principles of natural justice. The principles and rules thus arising through the
administration of justice in Courts of Chancery were called Equity' in contradistinction to Common Law.
Upta 1873 there remained IWo separate systems of Courts namely, Common Law Court and Chancery
Court, but in 1873 both the Courts were amalgamated by Act of judicature and the new Courts were
assigned with the power of enforcing all the rights and remedies legal as well as equitable.

Equity, therefore, in its technical sense, may be said to bea portion of natural justice which, though of
such a nature as properly to admit of being judicially enforced, was for circumstances hereinbefore
noticed, omitted to be enforced by the Common Law.Courts—and it was an omission which was
supplied by the Court of Chancery."

Equity as a branch of Law--Equity as a branch.of any legal system. may therefore be said to mean the
principles or rules emerging from the administration of justice through a power and duty vested in the
judges in those cases which are not covered or adequately provided for by the existing law of the land.
The system of law prevailing in a State springs upon the basis of past cases or those that may be
anticipated for future. It is impossible to prepare such a comprehensive code as to cover every possible
case. It is, therefore, essential that there must be in the State a machinery which may, by notification or
innovation held the existing body of law in the State. Equity fultills this requirement of the society by
supplementing the law and naking it more liberal and kind. Equity, has in the words of Storey, "the
sanction of ists in ancient as well as in modern terms" and in this sense Equity must have the words of
the same learned writer, a place in every national system of sprudence, if not in name, at least in
substance.

Description of Equity.—Aristotle has given a very comprehensive descniption of Equity as follows: "It is
Equity to pardon human failings and to look to the law•giver and not the law; to the spirit and not to the
letter, to the intention and not to the action; to whole and not to the part; to the character of the actor
in the long run and not to the present moment, to remember good ratheri than evil and the good that
one has received rather than the good that one has done, to bear being injured to settle a matter by
words rather than by deeds; i lastly to prefer arbitration to judgments for the arbitrator sees what is
equitable, but judges only the law and tor this an arbitrator was tirst appointed in order that Equity
might flourish."

Maine describes Equity as "any body of rules existing by the side of thei original Civil Law, founded on
distinct principles and claiming incidentally to supesede the Civil Law by virtue of a superior sanctity
inherent in those principles."

Definition of Equity.-There are many definitions of Equity each disin from the other but all agree on the
general nature of Equity, which synonymous with 'natural justice', 'honesty' and 'right."

•‘ Plato said, "Equity is indispensable to any intelligent administration justice•。 According to Aristole,
'justice and cquity are neither absolutely t: same nor gencrally different. His view is that the dillerence
between justic and equity is only that of the degree. He further says that equity possesses high degree
of justice. It embodies a moral ideal and is constant and immutable Aristotle has also said that "Equity is
the correction of the law which is defective on account of its gencrality."

Blackstone defines Equity as the "soul and spirit of all law; positive law is construed and natural law is
made by it. In this way Equity is synonymous with justice in that it is the truc and sound interpretation of
the rule."

West. J says, "Equity is an intellectual energy. It is influenced by the gradual changes in the mental
standpoint taken by successive generation. It thus moulds its deductions from one set of data as the
Common law to another into continued adaptation to the growing needs of society:"

Snell says that "in its technical sense Equity may be defined as a portion of natural justice which,
although of a nature suitable for judicial enforcement was, for historical reasons not eniorced by the
Common Law CCourts, an omission which was supplied by the Court of Chancery."
Story says that, "Equity Jurisprudence may properly be said to be that portion of remedial justice which
was exclusively administered by a Court of Equity as contradistinguished from that portion of remedial
justice which was exclusively administered by a Court of Common Law."

Mailland observes that "Equity now is that body of rules administered by English Courts of justice which
were but for the operation of the Judicature Acts, would be administered by those courts, which would
be known as Courts of Equity".

In re Khandas Narrendas, (1980) 5 Bom. 154, 172.

Sir lenry Maine •has defined equity as any body of rules, the primary source of which was neither
customary nor written law, but the imperative dictates of conscience and which had been set forth and
developed in the Courts of Chancery.

According to Aristole "Equity is the correction of the law where it is defective on account of its
generality." He further elucidates, "It is equity 1o pardon human failings and to look to the law giver and
not the law, to the spirit and not the letter."

No doubt, the definition given by Prof. Maitland is an improvement over the delinition of Story. but it
also suffers from the same defect as the definition ol Story. Thereiore, we have to concede that the
diference between equity and common law is more in form than in substance, the difference is more
histori al than in actual content.

Summary Taking into consideration the above definitions this becomes quite clear that TEquity', now is
that body of rules administered by the English Courts of Justice which, before the operation of the
Judicature Act of 1873, were administered only by those courts which were known as Courts of Equity.
Wei can further describe that

• (i) Equity is founded on principles of natural justice;

i) It is the body of rules and principles which exist side by side of the original Civil Law; and

i) It does not supersede the existing law, but is a supplementary addition to such law.

Nature and Scope of Equity.—To a layman, equity must primarily mean right doing, or justice in the
purely ethical meaning of that word. Nevertheless, to the learned in any legal system equity rarely
retains that i freshness of interpretation because some sort of technical significance tends to attach to it.

In England equity has acquired an entirely specialised meaning. It includes technically only certain rules
which were developed in the Court of Chancery.

The basis for its creation may have been the desire to do right between men• according to the moral
law of the time, but it was always limited and has now i become a fixed body of principles of a like
character to, though different in many respects from, the Common Law. It is no longer possible to claim
redress simply upon moral grounds; it is necessary to show some principles recognised byi the system of
equity before a remedy can be granted, just as some rule of the Common law must be prayed in aid to
support an action at law.

 It is difficult, to give a specific statement on the scope of Equity but to quote Aristotle, "equity is
the correction of the law where it is defective on account of its generality," and indeed Equity
came to safeguard and promote the interest of justice against the rigidity, defects or
deficiencies of the existing law in thei State and to achieve this end is generally extended its
scope in supplementing i the Common law in the following three respects by enforcing:

i) New right;

ii) New remedies; and

(iii) New procedure.

Firstly, Equity has enforced rights which the Common Lav. Fourts failed to enforce, Secondly, Equity has
developed additional remedies the common law for the enforcement of common law rights. And
thirdly, the procedure in the Common Law Courts was defective, specially in not compelling or even
allowing a defendant to give evidence and in limiting the inquiry to the parties to the action

In short, the maxim, "Equity will not suffer a wrong to be without a remedy" expresses true scope of
Equity.

In a progressive society, the thoughts and ideas of the people go ahead of the law calling for equity to
provide justice in cases of rigidity, defects or deficiencies of the existing law. Equity jurisdiction may be
exercised by the common law courts or the special courts but with the development of the legall
system, equity is gradually assimilated into the statutory law. Although, thei importance and need of
equity diminishes gradually with development of law through incorporation of the rules of equity into
the statutory law, it isi unilikely that the need and importance of equity can ever be dispensed with. It
will continue to remain an important branch and source of law.

CHAPTER 2

EQUITY UNDER ROMAN, ENGLISH AND INDIAN LEGAL SYSTEMS

Equity under the Roman LawThe theory of a set of legal principles entitled by their intrinsic superiority
to supersede the older law, very early obtained currency both in Rome and in England. Such a body of
principles existing in any system, has been denominated. "Equity, a term, which was one of the
designations by which this agent of legal change was known to the Roman /uris consalts.

Early period.—Before the introduction of Equity' in Roman Law, all the religious and temporal powers
were confined in the hands of the Monarchs. They were the absolute judges of right and wrong. In the
earliest period of the Roman Law, there were five actions (lgs actionis) for the enforcement of all civil
rights. The Jus Civile was strictly followed and all other technical requirements were freely examined
before giving the judgments; there was no remedy for the wrongs, if they did not come under any of the
recognized five actions. Thus, the law was rigid, formal and arbitrary

Praetors introduced Equity—The process of introduction of Equity in Roman Law started on the
appointment of Praetors in 366 B.C. who were the Chief Judicial Magistrates of the Roman Republic.
These Praetors were called upon to discharge the duties of the Supreme Judicial head of the State, and
together with these duties to them was transferred the undetined supremacy over law and legislation
which always attached to ancient sovereigns. They having dlothed with extensive powers to modify or
change the laws, began to exercise their jurisdiction by means of ormulas, which means written
statement made after ascertaining the exact points in controversy

The Praetors at the beginning of their year of office published an 'edicr" in which they stated the rules of
procedure which they intended to follow in the coming year. This edict was known as the perpetual
edict (edictum perpetuum) since it was to remain in force during the whole year, by way of contrast with
temporary or occasional edicts. Normally a Praelor would adopt the greater part of his predecessor's
edictum perpetuum, and that part of it which went on from year to year was called edictum Tralatinuum
(the edict "handed on") whilst the new rules were known as the 'edictum nouum'

There frequently arose cases in which strict observance of the Jus Civile would do irreparable loss to the
person and due to which he was victim of some moral wrong which was inequitable and against the law
of nature. In such cases the Praetor could allow an action to the plaintiff who did not have right
according to the Jus Civile. Similarly, the Praetor could deny an action to the person who was entitled to
one by the Jus Cioile. The Praetor who administered both the civil law and equity. The cases in which,
the Praetor had to create

17]

new rules known as 'elictun nouon', grew more and thus a body of moral principles was introluced to
the Roman Law which existed by the side of thei original Civil Law Uus Civile).

By the time of Salvitus, Julius in the first century A.D. who occupied thei chair ot Iracior under Imperor
Hadrium. the edicts had acquired great bulk Salvius Jnlianus under the instruction of the Emperor
Hadrium, consolidated and put together all previous edicts and gave it a permanent form known as
thei•aictum Perpetuum" of Saloius Julinauis and this embarrassed the whole body of equity
jurisprudencc.
The extraordinaty jurisdiction continued for a long time side by side the ordinary jurisdiction. In 294 A.l).
by a Constitution of the Emperor Diocletian all causes in the provinces were required to be tried in the
same manner, and finally the same rule was made universal throughout the whole Empire.

Administration of Equity.-The Equity of Rome, it should be noted, was i always administered by the same
tribunals. The Praetor was the chief equity judge as well as the great Common law Magistrate, and as
soon as the edict had evolved as equitable rule the Practor's Court began to apply it in place of or byi the
side of the old rule of the civil law, which was thus directly or indirectly repeated without any express
enactment of the legislature. The result of course, i fell considerably short of a complete fusion of law
and equity, which was not carried out till the reforms of Justinian.

Equity under the English Legal System.-In English Law we may distinguish between two meanings of
"Equity", the distinction having come about as the result of historical development. In the first place the
term may bei taken to represent the general endeavour to make the law and itsi administration as just
and as humane as possible. In its other meaning it denoles the doctrines evolved by the Court of
Chancery in giving effect to the first and more general meaning. This must not be taken to imply that
there never has been in the English system, outside the Court of Chancery, any manifestation of that
general, tampering discretion exercised by the judiciary. Indeed, from the very earliest times down to
the present we find instances of all three manifestations of cquity, the liberal interpretation of the law,
its relaxation in particular cases and the creation of new doctrines. Examples of liberal interpretation,
solicitcd at random, are the presumptions of innocence in favour of the accused, the principles of
natural justice, the rule that the Privy Council will entertain appeals from colonies to prevent injustice
being done, and the statutory rule empovering the judgs to refuse the extradition of fugitive offenders
to other parts of the Commonwealth if it would be unjust or oppressive to do so.

The correction of the Common law by equity has been the subject of some dispute. Mailland insisted
that, apart from a few triling instances, there was no conflict between them. "Equity" had come, not to
destroy the law, but to fulfil it. Every title of the law was to be obeyed, but when all this had been done,
something might yet be needful, something that Equity would require."

Undoubtedly the defects and rigidity of the old Common law gave rise to Equity. The difference between
Common Law and Equity has been very welli summarised by in these words "Equity was originally the
revolt of commonsense

against the pedantry of law and trammels of the feudal system. It became ai highly artificial and refined
body of legal principles and it is at the present day an amendment and modification of the Common
Law."

A different development, which was destined to exert a profound influence on English Equity, had begun
carier. The character of the Chancellor changed. i and le was no longer an ecclesiastic but a trained
lawyer. The result of this was i that the Common law tradition of relying on previous decisions gradually
brought about systematization in the application of conscience and the introduction of the idea of
Equity as a body of set rules and doctrines existing side by side with the Common Law.
To trace the development of Equity under the English law we will have to go back to the 13th century
when Edward I was ruling our lingland. In those i days there were three sreat courts in existence namely

i) the King's Bench:

i) the Court of Common I'leas; and

(iii) the Exchequer.

The law which these Courts administered was in part "traditional law' and in part Statutory Law'. The
'Statute Law' was also called 'Common Law.'

The Chancellor—Of these courts the 'Exchequer' Court was not only a court of law but was also the
Secretariate Department of the Government called the "Chancery." The head of the 'Chancery' was
called Chancellor who was not i originally a judge but was the King's Prime Minister and most important
member of the King's Council. He was the King's Secretary of State for all the i departments and kept the
King's great seal and also all the writs which were to be issued in the King's name were done under his
supervision."

As has been mentioned above, the Chancellor at that time was not a judge : but had a connection with
the administration of justice. In the first place hei had to preside over the Chancery count whose duty
was to draw up the writs i and in new and difficult cases, the writ had to be drawn under the
Chancellor's direction. Secondly, in another way, the Chancellor came to be more directly connected
with the administration of justice. From the earliest times, the King, i who was considered to be the
fountain of justice, had an unlimited jurisdiction in extraordinary cases. When a person did not expect a
fair and impartial triall from the ordinary tribunals, or where the law courts were incompetent to grant
reliet, the only course to the aggrieved party was to petition the King, who decided the case with the
help of his Council. Afterwards, when from thel pressure of affairs of state, as well as due to increasing
number of such petitions, i it became inconvenient for the King personally to exercise this jurisdiction,
which was called "the prerogatives of grace', the work of disposition of suchI petitions fell upon the
Chancello, who was not only what may be called thei King's Prime Minister, but was also a very learned
Member of the Council. Thel Chancellor decided such cases, not according to the technicalities of thel
Common law, but according to justice, equity and good conscience.

At first the Chancellor professed to exercise this jurisdiction with thei leave of the Crown but in the reign
of Edward III, the legislature empowered

Maitland

him to grant relief in extraordinary cases. From that time he began to exercise his jurisdiction vigorously
with the respect and good will of the public, for he was a Common Law Judge as well as a high
ecclesiastic, versed in both Civil and Common Law, and from his position, eminently suited to introduce
salutary changes without innovations. i
The Chancellor did not consider himself bound by precedents and the rules of Justice. Equity and 'Good
Conscience' were followed by him. The Court of Chancery was a Court of Conscience, it had for its object
the guardianship not of the rights but of the conscience of the parties coming before it. Equity
originated from the King's conscience and operated on his subjects' conscience

The principles and rules thus arising through the administration of justice in the Court of Chancery were
called Equity in contradistinction to common law. i The Judicature Act of 1873 amalgamated the two
separate Courts and a High Court of Justice was established with jurisdiction to recognize all the rights
and to provide all the remedies formerly given either by the Court of Chancery or the Courts of law.
Thus, "Equity now is that body of rules administered by the English Courts of Justice which were if not
for the operation of the Judicature Acts, would be administered only by those Courts which would be
known as a Court of Equity."

Distinction between Roman Equity and English Equity. The Roman Equity, resembles the English Equity
on the following points:

(1) Basic authority similar.—Just as the authority of the English Equity was based on the •royal
prerogative", the authority of the Roman Equity was i based on the imperium, a survival of the royal
power to see justice done to the people which vested in Praetor during his period of office.

(2) Common object.—The object of both was the same, ie., to reduce the rigours and deficiencies of the
old law.

(3) No repealing of old law.—Both left the old law unrepealed, rather supplemented the old law.

(4) Based on analogy.—Both were in certain matters founded on analogy to the old law

(5) Nature.—Both claimed to override the old law by virtue of an inherent superiority of principle.

(6) Development and origin.—Both English and Roman Equity had similar origin and development. In
both places it was evolved as a reaction against the rigidity and formalism of Common Law.

The 'difference' between the two were as follows:

(1) Administration.-English Equity was administered by, a different official and not by one who
administered the common aw. 'The result was that there was constant contflict between the Common
Law Courts and the Court of Equity in England. Roman Equity was administered by the same official viz,
the Praetor, who administered, both the civil law and Equity hence, the conflict at Rome between Equity
and civil law was devoid of practical inconveniences.

(2) Nature.—English Equity was judicial principle and in many cases eruences

exposed facts in nature. Roman Equity was in nature and form statutory law embodying general
principles to meet defects which had become 3) Subject—The subjects covered by the two also present
a distinct apparent in the past. contrast. Originally the main subject of English Equity was thei
development and enforcement of 'trusts'. It devised equitable remedies like injunction and specific
performance in case of breach of contract. i Roman Equity did not at first recognize the binding nature
of trust. On• the other hand, the largest portion of Roman Equity dealt with "wills" and •succession',
English Equity refused to deal with such matters. (4) One more distinction is seen between the two.
Roman Praetors was by virtue of his position more qualified to introduce comprehensive hanges in to
the law than the English Chancellor who confined himself to the concrete facts of the case and could not
go behind them.

EQUITY UNDER THE INDIAN LEGAL SYSTEM

Equity in India not an independent branch of Law.-In India, there was i never any separate Court for the
administration of Equity. The greater part of the law to be applied by the Court, has been codified. But in
the absence of specific law or usage in any matter, the Court has to act according to principles of Equity',
Justice' and 'Good Conscience' interpreted to mean only those rules of English Equity which are
applicable to Indian society and circumstances.

Origin of Equity—Hindu and Mohammedan law.-In India, the origin of Equity can be traced back to the
Hindu period when jurists explained the old laws and gave new rules of interpretation and equitable
solutions in case of conflict between the rules of various laws. Hindu Law had never been static and has
consequently introduced equitable principles to meet the exigencies of the

It has been laid down that in case of a conflict between the rules of times. "Smritis" either may be
followed, as reasoning on the principles of equity. Yuktivichar shall decide the solutions. Jayaswal has
also collected authorities to the same effect. He says:

"We may recall Kautilya's provision that in the dharma text is found opposed to judicial reason the
dhama text fails and there the authority of reason prevails. Yajnavalkya .says, "where there is a conflict
between two smritis texts, reason (Equity) is there stronger. He limits the superiority of Reason or Equity
to a conflict between the Sastras

In Mohammedan Law also the principles of Equity are clearly noticeable. themselves." Abu Hanja, the
founder of the Hanafi Sect of Sunnis, expounded the principle that the rule of law based on analogy
could be set aside at the option of the judge on a liberal construction or judicial preference to meet the
requirements of a particular case. These principles of Mohammedan Law, are known as stihsan' or
'juristic Equity'. With regard to the Mohammedan Law. Their Lordships of the Privy Council in Hamina
Bibi v. Zubaida Bibi observed as follows: •The chapter on the duties (Adab) of the Qazi in thei principal
Works on Mussalman Law clearly shows that the rules of Equity and equitable considcrations commonly
recognized in the Courts of Chancery in Engand, are not foreign to the Mussalman System, but are in
fact often referred to and invoked in the adjudication of cases."2 It may be noted that all the rules of
Einglish Lquity are not applicable in India.

Courts under the East India Company—Regulation of 1827 required the East India Company Courts to
act according to justice, equity and good consciencein the absence of.a specific law and usage. Under
Clause 36 of the Supreme Court Charter of 1823. the Supreme Court of Bombay was expressly made a
Court of Equity, and given an equitable jurisdiction corresponding to that of the Court of Chancery. The
provision of the rule of 'justice', eeuity' and 'good conscience' as expressly laid down nearly in all
subsequent Acts for the guidance of judges. i

Thus, in India, the Courts are vested with the equitable jurisdiction also and would decide those cases
for which there is a provision under the existing body of law according to the principles of 'justice',
equity' and 'good conscience'.

Statutory recognition of Equity.—The Supreme Court observed in O/ficial Trustee, WV.B. v. Sachindre,'
that •in fact in this country we have codified thei very principles that were exercised by the Chancery
Courts in England under their equitable jurisdiction. " Statutory recognition of the principles of Equity is
found in the Specific Relief Act, 1877,' the Indian Trusts Act, 1882, Indian Succession Act, 1925, Cuardian
and Wards Act, 1890, Indian Contract Act, 1872 and in the Transfer of Property Act, 1882.

Specijic Reliey Act.—The provisions of the Specific Relief Act regarding injunction, specific performance,
cancellation, rectification, and recession, etc recognize, the principles of Equity to a large extent.
Banerjee in his Tagore Law Lectures observes that "the Specific Relief Act is admittedly based on
doctrines of equity jurisprudence which were originally developed in England. The guidance afforded by
the decisions of the foreign Courts in interpreting and applying the provisions of the Indian Acts is
therefore of peculiarly valuable character."

Indian Trusts Act.—The rules contained in the Indian Trusts Act, 1882 are substantially the same which
were administered at that time by Englisih Courts of Equity under the name of justice', 'equity' and
'good conscience.'

Indian Conract Act.—There are certain equitable doctrines which havei been imported in the Indian
Contract Act, and some of the important doctrines i relating generally to the law of contract are the
doctrines of penalties and forfeitures, stipulation as to time in a contract, equitable relief on ground of
misrepresentation, fraud and undue influence. Sections 64 and 65 of the Indian Contract Act is nothing
but the codified form of the maxim, "He who seeks equity must do equity."

Transfer of Property Act.—The Transfer of Property Act has also included many doctrines of Equity
originated in the Court of Chancery in England. Apart from such doctrines Sections 48 and 51 of the
present Transfer of Property Act are based on the principles of Equity. The English equitable doctrine of
part

2( 1916) 43 IA. 294.

3AIR 1969 SC 823

4. Now Specific Relief Act, 1963.

performance has also been drawn in Section 53-A of the Transfer of Property Act. Conclusion.—Thus we
have seen that in enacting many statutes, the Indian
Legislature has substantially adopted the English rules of equity, but it must also be noted that all the
rules of English Equity are not applicable in India. i There are many rules of English Equity which have
either not been followed in India or imported only in a modified form in view of the special
circumstances of this country. For example, while the English rule is that a Court of Equity will not
compel speific performance of a continuous duty extending over many years, Section 21 (g) of the
Specific Relief Act puts a definite time limit in this respect, tz., that contract requiring performance of a
continuous duty extending over more than 3 years will not be specifically enforced. The rule embodied
in the second part of Section 15 also differs from the English Rule. Where the deficiency is so serious
that the Court will not allow the vendor to claim specific performance, the purchaser will not be entitled
to specific performance in respect of the property as is capable of being conveyed, unless he gives up his
claim to compensation for the deficiency.

The conception of a trust in English law involves that of a double ownership, the trustee is said to be
legal while the cestui que trust as the equitable ownership. In India there is no such thing as equitable
ownership and according to the law of India there can be o. ly one owner of a property. When property
is vested in a trustee, the owner of the property is the trustee and the Indian beneficiary cannot be said
to have an equitable ownership.

The equitable presumptions of satis/action' and 'ademption' are not applicable to ndia, and under
Sections 177-179 of the Indian Succession Act. 1925 the gits are construed according to the express
words used in thei will.

The distinction between penalty and liquidated damages has not been adopted in the Indian Contract
Act. Under Section 74, the party complaining of a breach of contract will always be entitled to not more
than what is reasonable compensation, in the particular circumstances of the case, notwithstanding any
stipulations in the contract itself.

The distinction between legal and equitable rights and interests does noti exist since the passing of the
Transfer of Property Act, 1882. Thus, the right of redemption of a mortgagor is not an equitable right in
India, but a legal right conterred by a statute. Similarly, the doctrine of 'advancement has been held to
be inapplicable as the nature of benami transactions is quite dilferent from conditions obtaining in
England. Again in India there is no room for thei application of the English equitable doctrine that "a
contract for sale of real l property makes the purchaser the owner in equity of the estate." Section 54 of
the Transfer of Property Act expressly enacts that a contract for the sale of immovable property does
not by itself create any interest in or charge on thei property.

It is worth noting that

1. The principles ot natural justice, equity and good conscience are not i binding upon the Indian Courts
but are provided to cover the points not covered by the statute or general law.

2. The English equity does not apply to Indian adjudication:

3
(a) where it is of local character and not suitable to the Indian Society and circumstances; (b) where it
lacks certainty. (c) where it is not universally acceptable on account of poor merit.

Though the Indian Courts have power to discover new principles of equity they ought not to do so if
English Equity on the point is clear and satisfactory, nor can an express statutory law be overridden by
the principles of equity.

003