(1) Any person interested in a contract may sue to have it rescinded, and such rescission may be adjudged by the court in any of the following cases, namely:—
(a) where the contract is voidable or terminable by the plaintiff;
(b) where the contract is unlawful for causes not apparent on its face and the defendant is more to blame than the plaintiff.
(2) Notwithstanding anything contained in sub-section (1), the court may refuse to rescind the contract—
(a) where the plaintiff has expressly or impliedly ratified the contract; or
(b) where, owing to the change of circumstances which has taken place since the making of the contract (not being due to any act of the defendant himself), the parties cannot be substantially restored to the position in which they stood when the contract was made; or
(c) where third parties have, during the subsistence of the contract, acquired rights in good faith without notice and for value; or
(d) where only a part of the contract is sought to be rescinded and such part is not severable from the rest of the contract.
Explanation.— In this section "contract" in relation to the territories to which the Transfer of Property Act, 1882 (4 of 1882), does not extend, means a contract in writing.
Legal Commentary & Landmark Judgments: Section 27
Section 27 of the Specific Relief Act, 1963 provides for the judicial rescission of contracts where a contract is voidable or terminable by the plaintiff, or where the contract is unlawful for causes not apparent on its face.
This statutory framework establishes clear operational guidelines, balancing legal compliance with procedural safeguards.
Rescission under Section 27 is an equitable remedy available when consent was induced by coercion, fraud, or misrepresentation under the Indian Contract Act. The plaintiff must act promptly upon discovering the fraud; any subsequent acceptance of contractual benefits amounts to ratification under Section 27(2)(a), forfeiting the right to rescind.