TaxTMI 
TaxTMI 
2019 (2) TMI 2091
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....n STM-1 would be done at the MTNL sites/locations in Delhi (Kidwai Bhawan and Nehru Place) and Mumbai (Fountain Head & Prabha Devi) respectively as per the requirement with redundancy in last mile connectivity. For this bandwidth termination purpose, optical/electrical converter, cable and any other hardware/software etc. required, if any, would be arranged by the bidder free of cost." xxx xxx xxx "8. DELIVERY SCHEDULE (i) The physical connectivity for bandwidth should be completed within two months from the date of place of Purchase Order." The TDSAT, on considering this Purchase Order, held: "25. At this stage, it falls for consideration as to what relief the petitioner is entitled to on the basis of strength of its own case. For this purpose, it is useful to note at the outset that the petitioner was required to provide the last mile connectivity as per paragraph 4(iv) of the P.O. within two months. It is also not in dispute that petitioner did not provide the required connectivity not only by December 2008 but even by time when it chose to terminate the contract on 11.01.2011. The defence pleaded and argued on behalf of petitioner is that it was neither given access t....
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..... Instead of adopting this lawful course, the respondents proceeded to unilaterally impose rentals at their own rate of dark fibre. Such action of the respondents amounts to adjudicating a claim in its own favour without any authority for such unilateral act either under Section 70 of the Contract Act or under any of the provisions of the Contract(P.O.). xxx xxx xxx 28. As a result of aforesaid discussion, the claim of the petitioner is allowed but in part only. The principal amount which the respondent must refund or pay back to the petitioner would be Rs.1,10,57,268 - Rs.25,83,181= Rs.84,74,087/-. Petitioner has also claimed an amount of Rs.66,33,414/- by way of interest from the date the amounts became due and upto 15.07.2012. It has calculated this amount by applying a rate of 18%. The calculations are in Annexure P-14 which discloses the dates when the short payments were made after deductions. We are not persuaded to allow interest @ 18% in absence of any such stipulation in the Agreement (P.O.). Hence, while allowing the principal amount of Rs.84,74,087/- in favour of the petitioner, we direct payment of interest at the rate of 9% from the date the amounts became due upt....
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....when there is, in fact, a contract between the parties. Lort- Williams, J. held: "There remains to be decided the question whether the second defendant is liable under section 70 of the Indian Contract Act and to what extent. The remedy provided by this section is not dependent upon the law relating to the liabilities of principal and agent. It is an independent remedy, which is based upon a different cause of action, namely, upon whether a person has lawfully done anything for another or has delivered anything to him not intending to do so gratuitously, and such other person has enjoyed the benefit thereof. If so, he must either make compensation in respect of, or restore the thing so done or delivered." (at page 619) On the other hand, Jack, J. held: "As regards the appeal, it is clear that the second defendant cannot be held liable under section 70 of the Contract Act, in as much as this is a case of contract and, where there is an express contract, section 70 has no application, as shown by the heading of Chapter V of the Act, in which the section finds a place. It is headed "Of Certain Relations Resembling Those Created by Contract", evidently excluding relations actuall....
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....ne or services rendered, when the price thereof is not fixed by a contract. For work done or services rendered pursuant to the terms of a contract, compensation quantum meruit cannot be awarded where the contract provides for the consideration payable in that behalf. Quantum meruit is but reasonable compensation awarded on implication of a contract to remunerate, and an express stipulation governing the relations between the parties under a contract, cannot be displaced by assuming that the stipulation is not reasonable......" (at page 809) 6. In Mulamchand v. State of M.P., (1968) 3 SCR 214, this Court held that the provisions of Section 175(3) of the Government of India Act are mandatory in character and based on public policy. Therefore, the formalities that are stipulated when contracts are entered into on behalf of the Government cannot be waived or dispensed with. In dealing with a claim made under Section 70 of the Contract Act, this Court then went on to hold: "...... In other words, if the conditions imposed by Section 70 of the Indian Contract Act are satisfied then the provisions of that section can be invoked by the aggrieved party to the void contract. The first co....
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....red by the failure to discharge it is entitled to receive the same compensation from the party in default, as if such person had contracted to discharge it and had broken his contract. Explanation.-In estimating the loss or damage arising from a breach of contract, the means which existed of remedying the inconvenience caused by the non-performance of the contract must be taken into account." 9. This Section makes it clear that damages arising out of a breach of contract is treated separately from damages resulting from obligations resembling those created by contract. When a contract has been broken, damages are recoverable under paragraph 1 of Section 73. When, however, a claim for damages arises from obligations resembling those created by contract, this would be covered by paragraph 3 of Section 73. 10. Indeed, the present case is really covered by Section 74 of the Contract Act, which occurs in Chapter VI, which is headed, "of the consequences of breach of contract". Section 74 states: "74. Compensation for breach of contract where penalty stipulated for.- When a contract has been broken, if a sum is named in the contract as the amount to be paid in case of such breach, ....
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....damage or loss caused is a sine qua non for the applicability of the section. 43.4. The section applies whether a person is a plaintiff or a defendant in a suit. 43.5. The sum spoken of may already be paid or be payable in future. 43.6. The expression "whether or not actual damage or loss is proved to have been caused thereby" means that where it is possible to prove actual damage or loss, such proof is not dispensed with. It is only in cases where damage or loss is difficult or impossible to prove that the liquidated amount named in the contract, if a genuine pre-estimate of damage or loss, can be awarded." 12. In the present case, clauses 16.2 to 16.4 are relevant, and are set out as under: "16.2 (a) FOR DELIVERY OF STORES: Should the supplier fail to deliver the store/services or any consignment thereof within the period prescribed for delivery, the purchaser shall be entitled to recover 0.5% of the value of the delayed supply for each week of delay or part thereof for a period up to 10 (TEN) weeks and thereafter at the rate of 0.7% of the value of the delayed supply for each week of delay or part thereof for another TEN weeks of delay. In the case of package supply w....