Rescission Of Contract: An Analysis
Linta S Vijayan, CSI College For Legal Studies, Kanakkary, Kottayam
1. INTRODUCTION
A contract creates legally enforceable obligations between the parties. Ordinarily, once a valid contract has been entered into, each party is expected to perform the promises undertaken by it. A contract is an agreement having specific terms between two or more persons or entitles in which there a promise to do something in return for a valuable benefit is known as consideration. The contract law is at the heart of most commercial or business dealings. So, it is one of the most significant areas of law and can involve significant variations in circumstances and complexities. However, the law recognises circumstances in which a party should be permitted to withdraw from the contractual relationship and restore the parties, as far as possible, to their pre-contractual position. This remedy is known as rescission of contract.
Rescission essentially means setting aside, cancelling, or terminating a contract and releasing the parties from their future contractual obligations. It is particularly relevant where a contract is voidable because consent was obtained through fraud, misrepresentation, coercion or undue influence, or where the contract is otherwise terminable by the aggrieved party. The Indian Contract Act, 1872 and the Specific Relief Act, 1963 together provide the principal statutory framework governing rescission in India. Rescission must be distinguished from ordinary termination for breach. Termination generally brings contractual obligations to an end prospectively, whereas rescission, particularly in the context of a voidable contract, is concerned with undoing the contractual relationship and restoring benefits receives under it. The remedy is based on the principle that a person should not be compelled to remain bound by a contract that the law permits that person to avoid.
