Site navigation

In a civil suit for breach of contract containing a penalty clause, who determines the reasonable…

Section 74 requires judicial assessment of reasonable compensation when a contract stipulates a penalty. The stipulated amount sets the maximum, while settled principles and…

Choose your answer

In a civil suit for breach of contract containing a penalty clause, who determines the reasonable compensation payable under Section 74 of the Indian Contract Act, 1872?

Select one answer
Answer and explanation

Correct answer C

Section 74 requires judicial assessment of reasonable compensation when a contract stipulates a penalty. The stipulated amount sets the maximum, while settled principles and the circumstances guide the court's assessment; neither party nor a witness fixes the award alone.

Practice for these exams

Related question papers

Related exam syllabi

Related questions in this topic