https://www.taxtmi.com/caselaws?id=158093 Section 74 of the Indian Contract Act applies to forfeiture clauses and limits recovery to reasonable compensation not exceeding the stipulated amount. On the facts, the defendant breached the contract, but the plaintiff could retain only the earnest money of Rs. 1,000 and not the additional Rs. 24,000, because that stipulation was treated as a penalty and no further loss was proved. Mesne profits must be assessed on the value of use and occupation of the property, not by an arbitrary percentage of sale value; the trial court's rate of Rs. 140 per month was upheld, with interest payable as the profits accrued month by month, subject to the procedural limit in Order 20 Rule 12(c) CPC. en-us Tue, 15 Jan 1963 00:00:00 +0530 Tue, 26 Aug 2014 11:43:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=158093 Section 74 of the Indian Contract Act applies to forfeiture clauses and limits recovery to reasonable compensation not exceeding the stipulated amount. On the facts, the defendant breached the contract, but the plaintiff could retain only the earnest money of Rs. 1,000 and not the additional Rs. 24,000, because that stipulation was treated as a penalty and no further loss was proved. Mesne profits must be assessed on the value of use and occupation of the property, not by an arbitrary percentage of sale value; the trial court's rate of Rs. 140 per month was upheld, with interest payable as the profits accrued month by month, subject to the procedural limit in Order 20 Rule 12(c) CPC. Case-Laws Companies Law Tue, 15 Jan 1963 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=158093