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Reliance on the Emden Formula cannot be said to be against the law prevailing in India as Sections 55 and 73 of the Indian Contract Act provided only for entitlement to compensation and not the mode and manner in which such compensation is to be quantified.
Clause 37 of the Main Contract between ONGC and BSCL has no application as MII's claim is not for any consequential damage but for the direct losses occasioned by BSCL's breach of contractual duty to honour its time bound commitments. The said clause cannot be extended to the obligations towards MII under the sub-contract as ONGC has no role to play in respect of the breach of its obligations towards it by BSCL under the sub- contract.