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Contractual Damages: Kailash Nath Associ...

Pathak, Akhileshwa...

Case

Contractual Damages: Kailash Nath Associates v Delhi Development Authority

Pathak, Akhileshwar

IIMA-BP0423 | Published April 2, 2018 | 11 pages Case

Collection: Indian Institute of Management, Ahmedabad

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The Supreme Court judgement, Kailash Nath Associates v. Delhi Development Authority consolidates the law on award of liquidated damages and stipulations on penalties. Contractual damages are to cover losses and not to profit from or penalise the party in breach. Stipulated amounts in damages or penalties are appraised by the courts and only a reasonable compensation is given. Earnest money, and its forfeiture, stood distinct. It could be forfeited without appraisal. The case integrates the different categories and re-states the principles for award of damages.

Award of contractual damages; Award of penalties in contracts; Forfeiture of earnest money