No Penalty Clause in Contract: What Are the Implications?

2025 0 Supreme(Ker) 2106

The right to withdraw an offer before its acceptance cannot nullify the agreement to suffer any penalty for the withdrawal of the offer against the terms of agreement. ... The above penalty clause was there in Exhibit A2 and hence it is binding on the plaintiff. The plaintiff sent Exhibit A3 letter dated 29.03.2003 accepting the tender after knowing the said conditions and without raising any objection re....

2023 0 Supreme(P&H) 2688

The phrase 'rice short supplied' used in clause 9(i) of the agreement is in context with rejection of rice for not conforming to the specifications laid down. In the case in hand, the claim of PUNSUP was for cost of short supply of milled rice and not of penalty. ... The PUNSUP had made a claim for recovery of the cost of un-milled paddy and there was no claim for penalty under Clause 9(i). Further intere....

2023 0 Supreme(Del) 5561

CWC recovered various amounts on account of penalties imposed on MEFC in terms of Clause 3 of the Agreement. 10. ... The controversy before this Court is now confined to a singular ground - that the levy of penalty under Clause 3 of the Agreement is not permissible without CWC proving loss or damages. 38. ... In terms of Clause 3 of the Agreement, CWC was entitled to le....

2024 0 Supreme(Mad) 890

The forfeiture clause namely, Clause-13 of the agreement reads as follows:- (i) Clause-13:- "13. ... It is therefore, clear to us that the clause relating to forfeiture namely, Clause-13 as found in the agreement is penal in nature and the same cannot be enforced. ... The Hon'ble Supreme Court had time and again reiterated that if the clause stipulatin....

2025 Supreme(Online)(Mad) 70533

agreement and in such a case, the application of pre-payment penalty through the supplemental agreement would only be in respect of other loans barring the GECL loans as by the terms and conditions of the scheme, GECL loans are exempted from pre-payment charges. ... It is the further submission of the learned counsel that there is no clause in the sanction letter, which mandates the levy of pre-payment penalty#HL....

2023 0 Supreme(Chh) 699

24.2 of the NIT and thereby failed to sign an agreement within 28 days of issuance of LOI as per Clause 23.3 of the ITB. ... It is submitted that exercise of power by respondent No.1 in cancellation of contract, recovery of penalty and debarment under Clauses 6.1 and 9.2 of the Contract is arbitrary, illegal unjustified and without jurisdiction on the ground that since no agreement has been entered between the parties, no ....

2023 0 Supreme(Chh) 441

Clause 24 (13) of the agreement speaks about resolution of dispute by reference. ... The time which was agreed upon in between the parties was as per clause 22 of the agreement wherein from 01/04/2021, the agreement was to last till 45 days for lifting of rice. ... Thereafter, on 22/10/2021 (Annexure A/10) the appellant raised the dispute as per clause 24 (13) of the agreement#....

2025 Supreme(Online)(Del) 10881

The contract dated 03.06.2013, as was originally executed between the parties, indicate that the same contains a penalty clause which reads as under:- 7. Subsequent extensions of the aforesaid contract between the parties contained further provisions for levy of penalty. ... It is evident that levy of penalty by way of the impugned penalty order is not in terms of the relevant contractual provisions. Furt....

Liquidated    damages-Penalty-Agreement    to    sell    arrack    at    market     rote less Rs. 25-Breach of agreement. ... If by inserting a clause fixing the damages in the deed the parties intended that that sum should be held out in terrorem against any person committing a breach, then clearly it is a penalty. ... He claims damages on the footing of the words of his agreement....

2023 0 Supreme(Del) 1762

In terms of Clause 19 of the Contract Agreement, NHAI was well within its right to levy penalty (which to my mind are liquidated damages) @ 0.2% per day for initial one month of delay in depositing remittances and 0.5% for further delay beyond one month. ... It was submitted that the appellant's reliance on Clause 9 of the Contract Agreement is misplaced as the respondent had filed its claim solely on the....

2019 0 Supreme(Jhk) 1172

On the above grounds Mr. Pati, learned counsel argued that issue nos. Such a penalty clause merely fixes a maximum for damages which would be difficult to estimate in terms of money and anyhow does not deprive the aggrieved party of his right to damages that can be so estimated. If in making provision for breach of contract, the promisee puts in a stipulation not by way of reasonable compensation to the promisee on the breach of contract hut in order that by reason of its burden-some or oppres....

2018 0 Supreme(Del) 1256

Seen in light of the above understanding of the law, this court holds that the plaintiff has breached the terms of the agreement to sell dated 21.10.2012. Since this conclusion follows from the position of law emerging from section 74 of the Contract Act and the principles laid down in Fateh Chand (supra) and followed by the Hon‘ble High Court of Delhi in Bhuley Singh (supra), the defendant is entitled to retain such token amount even without filing a counter claim or set off. Howeve....

2015 0 Supreme(Del) 724

However, it is urged that this Agreement dated 18.6.2011 was superceded by the second agreement dated 25.8.2011. The second agreement dated 25.8.2011 has no such clause imposing penalty on the defendant. Hence, it is urged that the claim for Rs.6 crores is misplaced. (iv) It is further urged that the contention of the plaintiff seeking a decree jointly and severally against the defendant is a misconceived stand.

2005 0 Supreme(Del) 157

It is also pleaded that plaintiff did not complete the works. Since some chargeable and consumable items other than electrodes were supplied by it to the plaintiff and payments were made to other contractors on behalf of the plaintiff, no amount was payable and on the contrary Rs. 5. 65 lacs was paid in excess. It is pleaded that there is a penalty clause in the agreement.

2000 0 Supreme(P&H) 592

Rather the time of payment of the instalments was not made the essence of the contract. No right has been given to the D.H. that in the event of the default in the payment of any of the instalments, on the stipulated dates, the decree-holder will be able to execute the decree. A reading of the decree would show that there is no clause of penalty. In order to see this we will have to switch over the decree itself because it is a settled principle of law that the executing Cour....