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Showing contexts for: penalty clause can be enforced in Union Of India vs M/S Bansal Industries on 12 November, 2021Matching Fragments
28. In the case of Vishal Engineers & Builders vs Indian Oil Corporation Ltd. (supra), it was inter alia held by Delhi High Court that it was duty of the Court not to enforce penalty clause but only to award a reasonable compensation, which had been held to be statutorily imposed upon Courts by Section 74 of the Contract Act and Court had to adjudge in every case, reasonable compensation for breach of contract having regard to conditions which existed on date of breach.
It was held therein that if there was absence of any loss, whatsoever, an aggrieved party could not claim that it was still entitled to liquidated damages without, at least, proving a semblance of loss.