Prior to the Anglo-Indian law, that is before 1600, Equity
had its place in India in Hindu and Mohamedan law. Hindu legal system or Hindu
jurisprudence is embeded in Dharma as propounded in The Vedas, Puranas, Smritis
and other works on the topic. Dharma is an expression of the widest. import; it
cannot be defined but can be explained. It has wide variety of meanings: it is
used to mean justice (nyaya), what is right. in a given circumstance, moral, religious,
pious or righteous conduct, being helpful to living beings, giving charity or
alms, natural qualities or characteristics or properties of living beings and
things, duty and usage or custom having the force of law and also a valid royal
edict (rajashasana). In short what sustains is dharma and Manu expresses the
necessity of scrupulous practice of Dharma. In Hindu law according to jurists
like 4 (Kautilya) and (Yagnavalkya) where there was a conflict between Dharma
text and reason, the text had to give way and this was on principles of equity
which they named as fanfare (Yukti Vichar),
Yagnavalkya laid down:
Justice strong against memory
Where there is a conflict between two Smritis the principles
of equity as determined by popular usages (4) shall prevail. This rule
indicates, in the cases of conflict between two Smritis, the King was not given
any power or discretion to make a choice but he was required to apply the law
as approved by
custom and usage by the people themselves.
Dharmascha Vyavascha Charitra Rajshasanam. Controversial Quadruped West: Prepositional:
Out of these four, Dharmashastra, Economics, Practice or
Custom and King's fiats, that which appears last, i.c., - (Rajshasanam) is the
most authentic. This is evident from Narad Smriti which explains the method of
solving disputes regarding usufruct of the trees grown on a boundary. The
methods prescribed for settlement of boundary disputes were four. firstly, by
arbitration, secondly, by the residents of the locality, thirdly, by the King
on the basis of evidence and on the failure of all these methods. by the King
according to his best judgment which is equivalent to decisions given according
to Justice, Equity and Good Conscience. Moreover a judge should not rely merely
on the text of the Shashtras, for it may work to the detriment of Dharma. Thus,
Only Shastramashritya na duties vinirnayah. Thoughtless thoughtless people of religion.
Under Muslim law Abu Hanifa expounded such principles known
as Istihsan or juristic equity. This could be observed from the decisions of
the courts,
One has to note at the same time that under the British rule
there never were in India any separate courts administering equity. The Supreme
Court had both Common Law and Equity jurisdictions. As courts of equity they
had power and authority to administer justice as nearly as may be according to
the rules and procedure of the High Court of Chancery in Great Britain. In a
sense these courts combining both common law and equity jurisdictions, brought
about in advance the fusion of law and equity jurisdictions, which was effected
in England by the Judicature Act of 1873. In England the Judicature Act did not
fuse the two system of rules." In India, however, law and equity were
always treated as part of the same system. But the state of affairs before the
Charter Act of 1833 was so sad and perplexing and "widely differing from
each other but co-existing and co-equal" that it led to the enactment of
the Charter Act of 1833. Slowly and silently the principles of English law came
to be administered, particularly in the mofussils as "justice, equity and
good conscience". In effect what was applied in India was the Common Law
as liberalised by Equity. In India Equity worked through and not in opposition
to the Common Law."
Thus every court in India is a court of equity as well as of
law. It possesses as inherent in its very constitution as such. powers as are
necessary to do the right and to undo a wrong in administering justice."
In absence of specific rules of law the court will follow
the practice of the English equity courts with required modifications. Such a
practice however should be to give full, systematic and uniform effect to the
principles of equity and good conscience.15 Besides where the law exists, it is
the law that must prevail and not equitable principles. 16 Section 151 of the
Civil Procedure Code is designed to do real and substantial justice and to
prevent failure of justice. This power is to be exercised by the court-ex
debito justitiae-as of right and the court has no discretion to refuse.!?
In this connection it has to be noted that under Article
372(1) of the Constitution of India the law that was in force in India
immediately before the coming into effect of the Constitution, continues in
force until it is amended, altered or replaced by a competent authority.
The principles of equity have found statutory recognition in
India in:
(a) The Specific Relief Act, 1877 (b) The Indian Trusts Act,
1882
(c) The Indian Succession Act, 1925
(d) The Guardians and Wards Act, 1890 (e) The Indian
Contract Act, 1872
0) The Transfer of Property Act, 1882
(8) The Indian Divorce Act, 1869 (Section 7).
Macaulay who spoke in Parliament on Codification, reiterated
thi simple principle: "Uniformity when you can have it; Diversity when you
must have it, but in all cases Certainty, and accordingly the Codes and Acts
were formed. In applying the principles of equity the Indian courts in their
prolonged career of judicial legislation have shown remarkable discrimination.
In England an equitable right or estate is recognised as
something different from a legal right or estate. The interest of a beneficiary
in trust property is in England an equitable interest while the legal interest
in the estate is in the trustee. Again in England if a person agrees to sell
land he creates in the buyer an equitable interest in the land. These equitable
interests were the creation of the Court of Chancery. The law in India never
recognised any distinction between legal and equitable interests. As early as
in 1872, the Privy Council said: "The law of India, speaking broadly knows
nothing of the distinction between legal and equitable property in the sense in
which it was understood when equity was administered by the Court of Chancery
in England."
It is not surprising, therefore, that some of the peculiar
equitable doctrines were not found acceptable by the Indian courts, they held
that provisions in favour of children or other persons for their advancement
were unknown among Indians. The general law of Succession in India, the Indian
Succession Act, did not enact the rule of English law by which a child who
received a benefit must account for it on a distribution when a father dies
intestate. The rule has however been held to apply to persons subject to
English law in India.
As observed by the Supreme Court the principle, i.e., the
equity in Walsh v. Lonsdale does not apply to India.
A question whether an agreement to lease requires
registration came up for discussion before court in Tiruvenibai v. Lilabai.
This case was referred in the State of Maharashtra v. Atur India (P) Ltd. case
wherein a reference to Mulla's Transfer of Property Act (7th Edn.), p. 647 was
given which specifies distinction between an agreement to lease and an
agreement of lease. "An agreement to lease may effect an actual demise in
which case it is a lease."*
"On the other hand the agreement to lease may be a
merely executory instrument binding the parties, the one to grant, and the
other, to accept a lease in future."
As to such an executory agreement the law in England differs
from that in
India. An agreement to lease not creating a present demise
is not a lease and
requires neither writing nor registration.
As to an executory agreement to lease it was at one time
supposed that an intending lessee, who had taken possession under an agreement
to lease capable of specific performance, was in the same position as if the
lease had been executed and registered. These cases have, however, been
rendered obsolete by the decision of the Privy Council that the Equity in Walsh
v. Lonsdale does not apply in India.
The equity of part performance which in England mitigated
the rigour of the Statute of Frauds by taking a parole contract out of it when
it had been partly performed, seemed at one time to apply to India to the
extent of taking away the application of the laws requiring registration and
other formalities in such cases. The doctrine has now been in a partial form
incorporated into the statute governing transfer of property.
However, the statute law of India has incorporated in itself
to a extent equitable rules and doctrines. The Indian Trusts Act of 1882
embodies in a concise form the whole structure of trusts built up by the Equity
Courts in England. The Act also deals with "certain obligations in the
nature of trusts".. These are attempts to enumerate broadly circumstances
under which a person may be placed in the position of a trustee in reference to
another. These "obligations in the nature of trusts are no different from
the implied and constructive trusts found in the decisions of the English
equity courts, substantial.
Another instance of an almost bodily transplantation of the
doctrines of the English equity courts is to be found in the Specific Reliefs
Act of 1877. It deals with cases in which a court will order restitution of
specific property and order contracts to be specifically performed. It also
enumerates the circumstances in which the courts will grant the relief of rectification
and cancellation of instruments. The Act is in a sense a blend of common law
and equity in as much as it also makes provision in a qualified manner for the
writ of mandamus in certain cases. This statute powerfully illustrates how
those who were charged with the task of drawing suitable codes for India
discarded the distinction between law and equity in English jurisprudence, not
hesitating to include in the Act dealing mainly with the equitable relief of
specific enforcement, a remedy in the nature of the Crown writ of mandamus.27%
Thus English law and its principles were almost directly
introduced in the presidency towns of Calcutta, Madras and Bombay. In the
greater part of the country it obtained its sway in the guise of the principles
of "equity, justice and good conscience". A prolific source of
incorporation of these principles into Indian jurisprudence were the decisions
of the Indian courts. In the words of Sir Henry Maine the higher courts openly
borrowed the English rules thinking and believing that they were taking them
from some abstract body of legal principles which lay behind all law and the
inferior judges, no doubt honestly, thinking in many cases that they were
following the rule prescribed for them to decide "by equity and good
conscience" wherever no native law or usage was discoverable. The process
continues to this day. In the case of Indira Bai the Supreme Court of India
observed to this effect and said that the courts in this country are primarily
the courts of equity, justice and good conscience and they cannot permit the
respondent to defeat the right of the appellant and invoke a right (in this
case a right of pre-emption) which has been called a weak and inequitable
right.
In England great concem 'was projected by Lord Denning30 in
1952, and fortunately in 1966 the House of Lords resolved that it had freedom
to depart from previous decisions where they were thought to be wrong; though
it is a power used most sparingly. The House of Lords has thus proved its
creativeness. The Indian Supreme Court has not lagged behind and has expressed
the same kind of concern in Minerva Mills Ltd. in respect of stare decisis,
Justice Bhagwati, delivering a separate opinion said:
Certainty and continuity are essential ingredients of the
rule of law.. Certainty in applicability of law would be considerably eroded
and suffer a serious setback if the highest court in the land were readily to
overrule the view expressed by it in earlier decisions even though that view
has held the field for a number of years... and since the decision on many of
such questions may depend upon choice between competing values, two views may
be possible depending upon the value judgment or the choice of values made by
the individual judge. Therefore if one view has been taken by the court after
mature deliberation, the fact that another Bench is inclined to take another
view would not justify the court in reconsidering the earlier decision and
overruling it. It would create uncertainty, instability and confusion if the
law propounded by this court on the faith of which numerous cases have been
decided and many transactions have taken place is held to be not the correct
law after a number of years. But the doctrine of stare decisis should not be
regarded as a rigid and inevitable doctrine which must be applied at the cost
of justice. There may be cases where it may be necessary to rid the doctrine of
its petrifying rigidity."
In D.S. Nakara case wherein the Minerva Mills Ltd.
case" and Randhir Singh case were relied on the Supreme Court of India
through Chandrachud, Tulzapurkar, D.A. Desai, O. Chinappa Reddy and Bahrul
Islam, JJ., observed to the same effect in the following words:
"Every new norm of socio-economic justice, every new
measure of social justice is commenced for the first time at some point of
history. If at that time it is rejected as being, without a precedent, the law
as an instrument of social engineering would have long since been dead and no
tears would have been shed. To be pragmatic is not to be unconstitutional. In
its onward march, law as an institution ushers in socio-economic justice. In
fact, social security in old age commenced itself in earlier stages as a moral
concept but in course of time it acquired legal connotation. The rules of natural
justice owed their origin to ethical and moral code. Is there any doubt that
they have become the integral and inseparable parts of rule of law of which any
civilised society is proud? Can anyone be bold enough to assert that ethics and
morality are outside the field of legal formulations? Socio-economic justice
stems from the concept of social morality coupled with abhorrence for economic
exploitation. And the advancing society converts in course of time moral or
ethical code into enforceable legal formulations. Overemphasis on precedent
furnishes an insurmountable road-block to the onward march towards promised
millennium. An overdose of precedents is the bane of our system which is slowly
getting stagnani, stratified and atrophied. Therefore the absence of a
precedent need not deter us at all. We are all the more happy for the chance of
scribbling on a clean slate."
The aim and object of equity is to promote honesty and not
to frustrate the legitimate rights. Equity is always known to defend the law from
crafty evasions and new subtleties invented to evade law,36
In a very recent case?? the court discussed the role of
equity in field of tor In this case the building contractor constructed a
building in violation of municipal regulations which resulted in demolition of
top four floors. The allottee-owners of the demolished flats, having not been
informed by the builder about the illegal construction and not given notice of
caveat emptor, they suffered loss. On grounds of equity considerations the builder
was held liable to pay damages, including the amount paid by the allottees.
In the tort liability arising out of contract, equity steps
in and takes over and imposes liability upon the defendant for unquantified
damages for the breach of duty owed by the defendant to the plaintiff. Equity
steps in and relieves the hardships of the plaintiff in a common law action for
damages suffered by the plaintiff on account of the negligence in the case of
the duties or breach of the obligation undertaken or failure to truthfully
inform the warranty of title and other allied circumstances.
Principles of justice and conscience are the basis of equity
jurisdiction, but it must not be thought that the contrast between law and
equity is one between a system of strict rules and one of broad discretion.
Equity has no monopoly of the pursuit of justice. Equitable principles are
rather too often brandied about in common law. Just as the common law has
escaped from its early formalism, so over the years equity has established strict
rules for the application of its principles. Indeed, at one stage the rules
became so fixed that a "rigor aequitatis" developed: equity itself
displayed the very defect which it was designed to remedy. Today some aspects
of equity are strict and technical, while others leave considerable discretion
to the court.