Rescission and Cancellation of Instruments — MCQs

All questions with answers and explanations

Read the full set here, or use the practice card above to test yourself one question at a time.

1. Under Section 27(1), rescission may be adjudged where the contract is:

   • Voidable or terminable by the plaintiff (correct answer)
   • Fully performed by both sides
   • Registered with the sub-registrar
   • Made between family members only

   Explanation. Section 27(1)(a) allows rescission where the contract is voidable or terminable by the plaintiff.

2. Which of the following is NOT a ground on which a court may refuse rescission under Section 27(2)?

   • The plaintiff has ratified the contract
   • Third parties have acquired rights in good faith, without notice and for value
   • The plaintiff is a minor (correct answer)
   • The parties cannot be substantially restored to their original position

   Explanation. Being a minor is not a ground in Section 27(2). The four grounds are ratification, parties not substantially restorable, third-party rights acquired in good faith, without notice and for value, and a part that is not severable.

3. Under Section 28, if a purchaser fails to pay within the time allowed by a specific-performance decree, the vendor may:

   • Only sue for fresh damages
   • Apply, in the same suit, to have the contract rescinded (correct answer)
   • Immediately imprison the purchaser
   • Nothing further can be done

   Explanation. Section 28 lets the vendor apply in the same suit for rescission of a specific-performance decree where the purchaser fails to pay in time.

4. Under Section 29, a plaintiff suing for specific performance may:

   • Never seek rescission in the same suit
   • Pray in the alternative for rescission if specific performance is refused (correct answer)
   • Only seek damages
   • Withdraw the suit without any order

   Explanation. Section 29 allows a plaintiff to plead rescission as an alternative prayer within the same specific-performance suit.

5. Under Section 30, on adjudging rescission the court may require the party granted it to:

   • Keep all benefits received under the contract
   • Restore benefits received and pay any compensation justice requires (correct answer)
   • Pay double the contract value
   • File a fresh suit for restitution separately

   Explanation. Section 30 lets the court require the party to restore, so far as may be, any benefit received and to make any compensation justice requires.

6. Under Section 31, a suit for cancellation of an instrument can be filed by a person who:

   • Has already been sued upon the instrument
   • Has reasonable apprehension that a void/voidable instrument may cause him serious injury if left outstanding (correct answer)
   • Is a stranger to the document entirely
   • Owns the property registered under the document

   Explanation. Section 31(1) allows a proactive suit by a person with reasonable apprehension of serious injury from a void/voidable instrument, even before it is used against him.

7. If the instrument sought to be cancelled has been registered, Section 31(2) requires that:

   • The registration is automatically void
   • The court sends a copy of its decree to the registering officer, who notes the cancellation (correct answer)
   • The instrument must be reprinted
   • No further action is needed

   Explanation. Section 31(2) requires the court to send a copy of its decree to the registering officer to note the cancellation on the record.

8. Under Section 33(2), a DEFENDANT who successfully resists a suit on the ground that the instrument is voidable may be required, if he received a benefit under it, to:

   • Pay the plaintiff's legal costs only
   • Restore that benefit, so far as may be, or make compensation for it (correct answer)
   • Nothing at all, since he won
   • File a counter-suit

   Explanation. Section 33(2)(a): where the instrument is voidable, the court may require the defendant to restore the benefit or compensate for it. Under 33(2)(b), where the agreement is void because he was not competent to contract, he restores it only to the extent he or his estate benefited.