Economic Reasoning in Adjudication of Commercial Contractual Disputes in India

Niti Bhutani; Ram Singh

doi:10.1515/ajle-2025-2006

Article

Economic Reasoning in Adjudication of Commercial Contractual Disputes in India

Niti Bhutani and Ram Singh

Published/Copyright: May 23, 2025

Published by

Become an author with De Gruyter Brill

Submit Manuscript Author Information

From the journal Asian Journal of Law and Economics Volume 16 Issue 1

Abstract

This paper examines the key provisions of Indian contract law with special reference to commercial contracts. We evaluate how the Indian Contract Act and the Specific Relief Act fare on the efficiency criterion in the economic analysis of the law. Further, we discuss whether the Indian courts use economic reasoning while filling up gaps in commercial contracts and choosing a breach remedy. We argue that the law governing commercial contracts has several inbuilt features that are desirable from an efficiency point of view. However, several factors constrain the efficient adjudication of commercial contracts.

Keywords: contract law; commercial disputes; litigation; adjudication; Supreme Court; India

Corresponding author: Ram Singh, Delhi School of Economics, University of Delhi, Delhi, India, E-mail: ramsingh@econdse.org

Funding source: Anusandhan National Research Foundation (ANRF) India

Award Identifier / Grant number: CRG/2021/007007

Acknowledgements

We have benefitted from the comments received from the participants at the conference on The Past, Present, and Future of Law and Economics in East Asia at Cornell University Law School. We thank the editors and referees for valuable inputs.

Research funding: This work was supported by the Anusandhan National Research Foundation (ANRF) India (CRG/2021/007007).

References

CUTS. 2018. Economic Impact Of Select Decisions of the Supreme Court and National Green Tribunal of India. Jaipur, India.Search in Google Scholar

Miceli, Thomas J. 1997. Economics of the Law: Torts, Contracts, Property, Litigation. New York: Oxford University Press.10.1093/oso/9780195103908.001.0001Search in Google Scholar

Posner, Richard. 2004. “Law and Economics of Contract Interpretation.” Texas Law Review 83: 1596–608.10.2139/ssrn.610983Search in Google Scholar

Rab, Ajar. 2021. “Comparing Specific Performance Under the Specific Relief (Amendment) Act 2018 with the CISG and the UNIDROIT Principles: The Problems of the “Un-common Law” in India.” National Law School Business Law Review 7 (1): Article 5.Search in Google Scholar

Saha, Kaustav. 2024. “Rights, Remedies and Retrospectivity: The Curious Case of the Specific Relief (Amendment) Act, 2018.” NUJS Law Review 17 (3).Search in Google Scholar

Singh, Ram. 2004a. “Economics of Judicial Decision Making, Indian Tort Law: Motor Accident Cases.” Economic & Political Weekly 39 (25): 2613–6.Search in Google Scholar

Singh, Ram. 2004b. “‘Full’ Compensation Criteria: An Enquiry into Relative Merits.” European Journal of Law and Economics 18: 223–37. https://doi.org/10.1023/b:ejle.0000045083.39477.bc.10.1023/B:EJLE.0000045083.39477.bcSearch in Google Scholar

Singh, Ram. 2021. “The Law and Economics of Force Majeure Litigation.” GNLU Journal of Law and Economics III (1): 7–27.10.69893/gjle.2020.000033Search in Google Scholar

Singh, Ram, and Utkarsh Leo. 2021. “Covid-19 and Contractual Disputes in India: A Law and Economics Perspective.” Economic and Political Weekly 56 (16): 37–43.Search in Google Scholar

Srinivasan, Badrinath. 2019. “Hardship & Substituted Performance as Defences against Specific Performance: Critique of the Recent Developments.” National Law School of India Review 31 (1): Article 3.Search in Google Scholar

Published Online: 2025-05-23

You are currently not able to access this content.

Articles in the same Issue

https://doi.org/10.1515/ajle-2025-2006

Keywords for this article

contract law; commercial disputes; litigation; adjudication; Supreme Court; India